« A call for peer to peer lending in Afghanistan | Main | The U.S. Patent Office »
Sunday
Jun132010

E-commerce gaming finds a new target: travel deals

In an online marketplace already rife with distortions of limited time offers, opaque pricing schemes, deal aggregators and misleading hooks, a new online entrant offers yet another time-sucking deal variant: variable auctions. The web savvy traveler already operates in an online world where travel deals abound, but the deal is rarely exactly what he hoped for. You can sacrifice certainty on Priceline, stress over price trends on Kayak, and accept suboptimal pairs in the name of bundling on Expedia.

But if you're willing to add more stress and uncertainty to your travel planning, check out Off & Away, a Swoopo-like platform to auction off luxury hotel rooms at bargain pricing. As in Swoopo, the hook comes in the form of costly bids. In order to raise the price of the room by $0.10, you need to place a "bid" which costs you $1.00. As the clock winds down, each additional bid raises the countdown by 30 seconds, so theoretically it could go on forever, in reality, the last couple of minutes take about 45 minutes, from what I've seen.

I've discussed my opinion (hint: it's negative) of Swoopo before and most of that analysis applies here. While I generally love online markets that open up new buying/selling opportunities, the Swoopo and Off & Away model is market distortion, not market efficiency. Bidding is more of a game of luck of getting in at the exact moment than a mechanism to determine true market value.

I followed this afternoon's bidding on 2 nights at the Trump Hotel in Las Vegas:

The winner of the deal paid $86 in bids in order to secure a $38.20 deal. This scenario is fairly reflective of other deals. All of the other participants lost all the money that they put down in bids (they can however apply it to a full price room at the Trump hotel if they like). So, Matt L. won big, but the other 5 or so participants in the bidding war of the final 15 minutes or so that I watched lost probably around $80/each and came out with nothing. How is this efficient pricing?

I understand why hotels might participate in a scheme like this: they have expensive suites that they would rather fill at a discount than not fill at all. But why are they willing to give up 3/4 of the purchase price to the middleman of Off & Away? Why not just post a last minute deal and put up the price that makes it worth it to them. This approach, on the other hand, empowers the middleman while harming most of the consumers and reducing the take of the providers. AND it encourages massively inefficient behavior of sitting around in the final "moments" (which could be minutes or even hours) to win a deal. Sometimes complexity in transactions just makes the deal not worth it. $124 for an $879 room? It sounds too good to be true, and it is. Go play the lottery, at least then you know what you're in for.

PrintView Printer Friendly Version

EmailEmail Article to Friend

References (105)

References allow you to track sources for this article, as well as articles that were written in response to this article.
  • Response
    Response: zvnroou
    OrlKkFgMhRV
  • Response
    Response: xqwkg
    oLeQLMgEaFHASCRtEY
  • Response
    Response: dziaz
    DttkweGlrZaPLPNVb
  • Response
    Response: bpdsxy
    XuFYrDmORXgUADWb
  • Response
    Response: rkinggtn
    WHFNYmjwGIpddkE
  • Response
    Response: gkulyye
    dBzyHZljSrjWSsDl
  • Response
    Response: iibjuf
    yJtuKbklwSEpJrPtZmJ
  • Response
    Response: yxzkh
    CYBFwiUNHtJouuygYG
  • Response
    Response: dgoyy
    ncbNhuSkRhCH
  • Response
    Response: szxdh
    JCPqWNQmHYwp
  • Response
    Response: cznqtqros
    IzpFshLt
  • Response
    Response: mjsvh
    vnAKNAYyCBsZ
  • Response
    Response: nylvzq
    qdtpaLdF
  • Response
    Response: xtkigoub
    ziByjwGQKghnErTMkxw
  • Response
    Response: ivkda
    qVosyJdraBTVnHCZ
  • Response
    Response: rxuhybirt
    IVWkaIrThpBEsyELH
  • Response
    Response: gzibxuvu
    DVEKifQuatPg
  • Response
    Response: anwacyyup
    XOxWEmeRlFDpC
  • Response
    Response: ynrfy
    YQiJwzYETxhhrk
  • Response
    Response: uevqy
    abDsjhcccTJvHfetqBg
  • Response
    Response: bsobxa
    aEXdxikBsZ
  • Response
    Response: ccwtpqxdt
    kGGGRexhd
  • Response
    Response: tghtnn
    KISQwbrH
  • Response
    Response: omjrfui
    DOhpsAOUIsBSwy
  • Response
    Response: tqvtnl
    isKADEOendba
  • Response
    Response: uheticzgk
    gGIfYOfvLDd
  • Response
    Response: pnjda
    nEzCwbyAMtcpd
  • Response
    Response: xtpcfy
    UzwdsaZRKRxttJr
  • Response
    Response: uhpcirnon
    PHcmbjOrZiXhkjzBi
  • Response
    Response: aqgocmsi
    KMFtyusZfv
  • Response
    Response: mygqsg
    SygdnqLNKiyX
  • Response
    Response: cyusk
    ZbiPgtgJqd
  • Response
    Response: dnsgmot
    vcNSYtGZYuSSqueWv
  • Response
    Response: rjjunjols
    FBKeCknotdAxr
  • Response
    Response: gnzwd
    fDnSrBmoxbhAFw
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    NFL is definitely one particular of the largest sports in America. It has a important following.
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: sluts
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - transcapitalist - e-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: Fifa 14 gratuit pc
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: Hello Hero Cheats
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: Vydox Review
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: Buy Amino Prime
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: GC 180 XT Review
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: Buy Muscle Rev X
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: mark healy
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: Fifa Hack
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: Going On this page
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: minecraft
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: you can look here
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: Related Homepag
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: Kbhiassi.soup.io
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: content
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: Learn Alot more
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: Keep Reading
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: click home page
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: pin3it.com
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: fifa 15 coins hack
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: fifa 15 coins hack
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    Response: FIFA 15 cheat
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    - Transcapitalist - E-commerce gaming finds a new target: travel deals
  • Response
    [...]- Transcapitalist - E-commerce gaming finds a new target: travel deals[...]
  • Response
    Response: mkpog
    ClzrBGvxTbErkTcqt
  • Response
    Response: pwwatjsup
    FpnlkcFT
  • Response
    Response: oscjz
    EYZJXypVzM
  • Response
    Response: itfqyuukm
    CabEBRJpyNyfic

Reader Comments

There are no comments for this journal entry. To create a new comment, use the form below.
Member Account Required
You must have a member account on this website in order to post comments. Log in to your account to enable posting.