“On Orbitz, Mac Users Steered to Pricier Hotels,” proclaimed the bold Wall Street Journal headline, which ignited a firestorm of negative publicity. Turns out Apple users “spend as much as 30% more a night on hotels” than PC users. They are 40% more likely than PC users to book 4- or 5-star hotels.
Based on this research, Orbitz started featuring more expensive hotels in its recommendations to Mac-based customers.
Apparently, many people read the Wall Street Journal as if Orbitz was charging Apple customers more for the same hotels, which the company quickly denied. There were price differences but these may have been due to different room categories being available when hotels were compared.
So, has Orbitz acted smartly in recommending pricier hotels to people like me who prefer Macs?
“Smart” says highly respected travel industry analyst Henry Harteveldt, cofounder of Atmosphere Research Group and chair of the Association of Travel Marketing Executives.
I see Henry’s point. After all, adult Mac users are significantly wealthier on average than PC users. Knowing that a majority of Apple customers choose more deluxe hotels, Orbitz gives them the hotel choices they need, while saving them time sorting through irrelevant ones. With more and more customers using mobiles, transactions must move quickly.
On the other hand, I say not so fast. That criterion, customers who use Apple, includes far too many people who must not behave as the majority. As Orbitz found, there’s a serious public relations danger involved in this type of large group sorting.
Please understand that I want sellers on the web to make my Internet experience more relevant. I want them to
In other words, I want Internet displays based on my behavior and that of people truly like me.
I like using Orbitz, whose site performs in a wonderfully user friendly way. I even had a very minor and now inactive business relationship with the company.
What this Apple customer does not like is to be included within a group so varied that my purchase behavior may not be typical of the majority, especially if this may lead to spending more than I would have.
Make no mistake, featuring more expensive hotel recommendations on its pages in my opinion will cause some Apple customers to spend more on Orbitz if they are not careful, even when they would have preferred not to.
What if a supermarket featured all of its name brand, more expensive products near its front door and its generic, less expensive items at the other end of the store? Not surprisingly, many people would make their selections before reaching the less expensive part of the store, even if they wanted more value. Moreover, others might feel manipulated and decide to shop elsewhere.
Of course, if the market had let in only people who prefered name brands through that door, there would be no problem.
When the Wall Street Journal article came out, Orbitz responded quickly and decisively that it does not charge Apple customers more for the same hotels.
I happened to be at an annual meeting of the Association of Travel Marketing Executives, when company CEO Barney Harford forcefully drove home this point. As Tnooz.com said, Barney had gone “on the warpath against the Wall Street Journal.”
Nevertheless, a first impression often becomes the most lasting impression. I wonder how many people a year from now will be telling their Apple friends not to use Orbitz because “it charges more.”
This situation becomes even more serious because some people already believe that third party sellers like Orbitz are more expensive than buying directly from hotels, even though in my experience this often proves to be spectacularly not true.
It’s hard to predict the lasting impact of this controversy. Unlike a Wal-Mart, Orbitz does not have strong enemies who will use every perceived misstep to their advantage. Its Apple customers may understand its good intentions.
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