In the previous articles, we have mentioned the SWOT Analysis of Suzuki, one of the world’s largest mass car manufacturers. This time, we will take an avenue on SWOT Analysis of Priceline.
Priceline is a world leader in travel deals. The Company provides a unique system to travelers known as “Name Your Own Price” where travelers would name their price for airline tickets, hotel rooms, car rental, and vacation packages. They offer more than a million services like lodging properties and helping travelers to find the right accommodation. Priceline helps millions of travelers to make their every trip a big deal.
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In this blog, we will look at the SWOT analysis of Priceline, but before that let’s have a look at the company overview.
Priceline.com is a travel agency for finding discounted rates for travel-related purchases such as airline tickets and hotel stays. Priceline was founded in 1997 on the back of the original idea. unique system to travelers known as “Name Your Price”. The company promotes the provision of travel services from its supplier to its clients. In April 2014, Priceline.com changed its name to “The Priceline Group Inc.”
The company name change was intended to create a clear picture between the global Priceline business Now, Priceline.com is one of six brands of Booking Holdings.
Priceline’s belief is to help everyone experience the moments that matter.
|Founder||Scott Case & Jay S. Walker|
|Origin||Norwalk, Connecticut, United State|
|No. of Employees||15,500|
|Market Cap||2384.18 USD (2021)|
|Annual Revenue||679 billion USD (2020)|
|Net Income/ Profit||59 million USD (2020)|
Product & Services offered by Priceline:
- Car Rental
Competitors of Priceline:
Swot Analysis of Priceline
SWOT analysis is a planning technique to help an organization identify its strengths, weaknesses, opportunities, and threats. SWOT Analysis of Priceline will help the company to assess the results to decide if they can use their strength as an advantage to increase the growth of the company. The weakness and threats of the company also need to be addressed before making any changes to their existing services.
1. Strength of Priceline
Priceline is a world leader in travel deals. let us look at the strengths given below:
- Expansion – Priceline has a strong user base in the international market and it has the seeds to continue to grow rapidly Priceline has invested heavily in the future market by its acquisitions of a stake in Ctrip and Agoda.com to move into the Chinese market.
- Profitability – Priceline can operate in a very profitable way relative to competitors it has a high margin including a gross margin of 88.90%, an operating margin of 36% and a profit margin of 27.40% allow Priceline to produce higher income from sales.
- Brand Identity – Priceline’s brand identity is a huge competitive advantage for the business. Priceline has invested significantly to promote its brand and capture a user base that has remained loyal to its six brands.
- Economic Growth – The growth level of Priceline has out-spaced the average growth of the S&P 500 and Priceline competitors in the space. The net income over this period has grown from 500 million to 2.4 billion.
2. Weakness of Priceline
Expedia controls the US market with a 40 % market share whereas Priceline has a much smaller 16%. Let us read about the weakness given below:
- Disruption in the Travel Industry – Financial prospects significantly depend upon the sales of travel services sales of travel tend to decline during general economic downturns and recessions when consumers engage in less discretionary spending because many consider traveling luxury goods when there are an economic downturn prices top and bottom lines will be hurt more severely than the average company
- Depend upon Provider Accommodation – Priceline relies on the provider of accommodation to make their service available to the consumer through us. Arrangement with the travel services provider generally does not require them to make available any specific quantity of accommodation reservation, rental car for any particular routine, or any particular price.
- High Market – Despite being headquartered in the United States and being the biggest travel services agency in the world. Priceline leads in the US market; Expedia controls the US market with a 40 % market share whereas Priceline has a much smaller 16%. Priceline we brand i.e pricelin.com and kayak.com are strong but they have failed to compete very strangely with Expedia.
3. Opportunity for Priceline
Priceline is the leader in an industry with very few players and has the opportunity to innovate solutions for its customers. Let us read about the opportunity given below:
- Online Advertising – There are various channels to enhance brand awareness and to generate a significant amount of traffic to price websites by executing a successful advertising campaign. The Priceline brand can grow and capture additional market share.
- Investing in Profitable & Sustainable – Priceline can grow in many different ways including strategic acquisition partnership joint venture or investments expanding into complementary business areas expanding current business and acquiring innovation technology for example in 2013 Priceline entered the metasearch business when they acquired KAYAK.
- Changing Structure in the Travel Industry – There has been considerable consolidation of the travel industry with mergers and acquisitions the dynamic in the industry is changing and there is an opportunity to gain market share in the net few years through strategic purchase additionally since Priceline is the leader in an industry with a very few players it has the opportunity to innovate solution for it customer.
4. Threat to Priceline
Expedia recently purchased Travelocity for $280 million, let us read about the threat given below:
- Intense Competition – Priceline competes with both online and traditional travel reservation services the market for the travel reservation service prices offers is intensely competitive and current and new competitors can get new services at an extremely low cost.
- Acquisition of Other Brands – If KAYAK is unsuccessful in profitability growing its global online brand or it experiences a remarkable reduction in advertising revenue due to factors such as loss of continued access to travel service information provided by other OTAs and travel service providers or a reduction in advertising on its websites. Priceline may incur an impairment charge associated with this goodwill.
- Increased Competition – Expedia recently purchased Travelocity for $280 million creating a fiercer competitor in the market this deal increases the user base for Expedia and allows them to scale their business and become greater competitors in the already competitive online travel service market.
SWOT analysis is a great way to learn the company’s strengths, weaknesses, opportunities, and threats to break down their complex existence into simple to understand marketing skills and strategies.
Priceline is performing well above and beyond the ten years. It has developed its business astounding as far as its top time and main concerns are concerned. it has indicated diminishing
Priceline battles an unusually set web-based travel administration industry that addresses around 40% of the absolute travel industry. It is the greatest travel service on the planet and has a large serious advantage with the scale and organization of clients. To proceed and flourish as it has previously, Priceline is more likely than not based upon its business.
As we learn just with opinions, the SWOT Analysis of Priceline is a top to bottom glance at the principal highlights and their objective. Priceline benchmarks its business and execution when opposed to its rivals. What’s more, it’s a simple fact that SWOT Analysis has assumed a significant part in its prosperity. Priceline helps a huge number of travelers to make all their trips successful.
Priceline should improve in on getting a portion of the overall industry locally by growing its business and putting resources into the client encounters center around coordinating its item and spotlight on incorporating its brands with better strategically pitching it item and putting resources into creating business sector to catch exceptional yields later on and to showcase their technique to assemble more crowd.
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