Is this enough compensation? Priceline refunds me $1 for overpriced hotel

Sometimes a best-price guarantee just isn’t worth the trouble. That’s what Lynne Fukumoto thought after trying to make a claim on a Priceline “Name Your Own Price” hotel room recently.

“I ended up with a room at the Ala Moana Hotel for $120 a night,” she says.

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That’s the Ala Moana Hotel – Honolulu, a nice little property in Waikiki, and part of the terrific Outrigger Hotel chain, for your reference.

“I had never heard of this hotel and went to its website where rooms were advertised for $119 per night,” she says.

Indeed, when I visited the Ala Moana website, it prominently mentioned its $119 per night room rate.

Fortunately, Priceline has a best price guarantee. Fukumoto decided to make a claim.

When I called Priceline immediately to notify them of this problem I was given the runaround and ultimately credited the
difference of $1.

However, I have learned that there is a policy in place where if you find a better rate in 24 hours you can either cancel the reservation (which I asked repeatedly to do) or be refunded the difference. I have tried unsuccessfully to contact Priceline to complain and have gone so far as to file a Better Business Bureau complaint against Priceline.

All I want at this point is to have my reservation cancelled and my money back. Can you help?

Fukumoto’s claim is actually covered by two guarantees. The first is the best price guarantee, which I’ve already mentioned. The second is Priceline’s Big Deal Guarantee.

I’m not going to try to decipher both guarantees here. Like all other corporate guarantees, they’re written by lawyers and polished by marketers to make you think you’re protected if you find a lower price. But many consumers know better. Most don’t even bother with a claim, because they suspect they’ll get snagged on the fine print, like Fukumoto.

Of course, Fukumoto could have done more research before naming her price on a Waikiki hotel. Had she checked a few of the other sites, she might have come in with a lower bid and saved lots of money. I suspect she could have found a hotel in the area that would have gladly accepted a bid at 30 to 40 percent below what she paid. That kind of deal would make even The Negotiator smile.

Still, I thought this was an excellent opportunity for Priceline to honor the spirit in which the guarantees had been made. So I reached out to the company.

“That’s not what the guarantee says,” a representative replied. “It says WE (the caps are mine) will either refund the difference or work to cancel the reservation. This claim was handled correctly.”

He’s right. The claim appears to have been handled correctly. But did Priceline do the right thing? Is a $1 refund really worth it?

Interestingly, another online travel agency — not Priceline — is making a big deal about its automated refund system. It’s running commercials featuring customers who received refund checks.

While this is admirable, it’s also kind of sad. If a best-price guarantee worked, you’d have customers taking it up online, telling their friends how great it is. You wouldn’t have to work hard to find people who have taken advantage of the guarantee, nor would you need to create an ad campaign around them.

This case had a happy ending, though.

Fukumoto took the matter up with Outrigger. She explains:

Based on Outrigger’s intervention on my behalf I was able to cancel the reservation due to “extenuating circumstances.” Ironically, I received another message from Priceline’s corporate headquarters, stating that my reservation could not be canceled, after it had already been canceled.

(Photo: celestria/Flickr)

47 thoughts on “Is this enough compensation? Priceline refunds me $1 for overpriced hotel

  1. She named her price. They accepted it. Sounds like everybody got what they wanted.

    Except after naming her price, she decided she wanted an even lower one.

    Still, the letter, like many similar letters, illustrate that Priceline and its ilk are a lot more murky and problematic than just contacting the hotel directly.

    1. Well, yeah…I’d want a lower price too if I found out that Priceline had given me a room that cost *more* than the deal I could’ve gotten directly through the hotel. Especially when they brag about their best price guarantee.

      The only murky part of this is whether or not she was really entitled to a refund. I don’t know what their guarantee says, but it sounds clear that at a minimum she’s due a refund of the price difference.

  2. If you are stupid enough to use a website like Priceline and accept their ridiculous terms and conditions, you should be stuck with what you bought.

    I’m not sure how her situation constitutes “extenuating circumstances” but…whatever.

  3. Well its a non-issue now, since Priceline cancelled her reservation.  I didn’t vote. 

    I’ve heard way too many horror stories with Priceline and would never use them for my travel reservations anyway.

  4. Wow, what a whiner. She named a price and it was accepted. I fail to see the problem. Even if the terms and conditions are a bunch of legalese she received exactly what she asked for. Didn’t she even do any research before going to priceline? She certainly went to an awful lot of trouble for the difference of a $1. 

  5. My experience has been that hotels intentionally give me poorer service when I use sites like Priceline and Expedia, so I don’t use them any longer.  I once complained to a manager about by room not being cleaned and was told, “Why would we service your room at the price you paid?”  It makes sense, as sad as that is, in that case I paid $55 a night at a 4 star hotel that normally cost $199, it was an incredible deal.  I wonder if Mrs. Fukumoto would have also received inferior service since she used Priceline, even if she paid more than the hotels rate?

      1. They don’t “list” with Priceline – they sell blocks of unsold rooms to Priceline. Priceline resells them to the public. Although she paid $120/night to Priceline, the hotel probably got closer to $25 per night from Priceline.

        A great forum site to check out what others have gotten – in terms of both bids and room type and service is

        1. Really? I was always under the impression they did not purchase blocks, but acted as a broker by negotiating private rates and with access to the hotel’s inventory…but not necessarily last room availability. It seems the business model would not work if they were committed to purchasing upfront and then reselling a block of rooms.

    1. It only makes sense if the manager has zero business sense. Having somebody getting an incredible deal to avoid the room going empty is smart business–they have opportunities to collect money on restaurant bills and other amenities at full price, and they may well get return business unless they’re stupid and piss the guest off like the idiot did in your case. In this era of social networks, does anybody believe it’s a smart idea to say something like that to a guest?  And the best part is that since the hotels volunteer to be part of those sites, the manager was essentially griping about his own hotel’s policy. 

    2. I have to agree. I think some hoteliers tend to look down on those who use third party sites. I booked a room at the Aroa through Orbitz. When I had a problem with my room, I could never get it fixed, even though I called maintenance twice.

      1. You are correct in that the less desireable rooms are given to these online companies.  An agent friend who had a tour company, which he recently sold as he was retiring, asked many of his contacts at major hotels about this and that is what they all told him. 

  6. I don’t understand why she wanted to cancel.  Was it because she was mad at Priceline for charging her more than the hotel would even though they did refund the difference?  Did she find an even lower rate for a package deal somewhere else? Did she have to cancel her travel plans completely?  If she would have booked the $119 room directly with Outrigger she could have cancelled up to 3 days before her stay was to start with no penalty which is much better than the Priceline policy.  Nothing is really clear other than the story makes me glad I never deal with these discounter websites.  

    Because of the remaining questions, I had to vote that the dollar was enough.  But how many hours of effort were wasted for that dollar?  

  7. What is her problem?  The hotel web site states rooms FROM (caps mine) $119.00 – not all rooms are that price.  She put in her amount of $120.00 and got a room for that price.  If I worked at Priceline I’d give her the runaround too for being a pain then give her a dollar back and hope in the future she stays away from Priceline.   

    1. Yes we’ve had people call up with similar whiny complaints.  We have to take time out oif our day for the stupidest, most meaningless adjustments.  You’d think the call wouldn’t be worth a couple of dollars.  We absolutely make sure they have to invest a great deal of theirs for wasting ours. 

      Let’s just say they get REAL familiar with the hold music loop……

        1. People usually get exactly what they deserve.  Why is customer service so bad today?  Because 80% of the people calling are asking really stupid questions.  Questions like “I bid the same price on a hotel room on Priceline because I was too damn lazy to check the hotel web sites in the area” or “You owe me $5 because I was too stupid to read the terms before I booked and didn’t notice the extra charge.”  And they call like it’s YOUR fault that they’re an idiot.  It just detracts from helping people who really need it.

          1. So, since Priceline advertises itself as a discount booking site, but yet they sold a room at higher than the hotel offers on its own website, that OP is stupid and deserves to be treated poorly?  Not everyone is Priceline savy.  Like Steve R said, get out of customer service.

  8. Sounds like the OP had buyers remorse when she looked up the hotel and saw that she didn’t get a “deal” that she couldn’t have gotten on her own.  Unfortunately, that’s not a viable reason for backing out of an opaque bid.

    Technically, the $1 is not quite enough compensation though.  Priceline ought to match the final price including taxes and fees.  The $119/$120 rates are pre-tax.  The hotel in question charges $135.61 after tax (that’s 14%).  Therefore Priceline probably charged the OP an additional 14 cents in tax on the additional $1, plus their $5 reservation fee.  So the compensation ought to be around $6.14 by my calculation.  But it doesn’t sound like the OP would have been satisfied with that.

    1. My calculation assumed a 1 night reservation.  If it was multiple nights, I would expect around $5 + ~$1.14/night in compensation.

  9. Wait – is this about the $1 difference guarantee or her changing her mind and cancelling the trip?  It seems extremely fishy.  She really cancelled the trip for a $1 difference?!?!?

    1.  No this is about an uninformed consumer who made a purchase without doing any research and now has buyers remorse. She wants out because she realized she could save way more than the $120 she bid on priceline had she tried. That’s the point.

  10. So how much time did she spend booking this, requesting the difference and writing to Chris for that $1? As mentioned, did this person have buyers remorse after seeing the location of this hotel?

  11. I was trying to rent a car in Portland.  Priceline’s ad said they had cars in Portland for $19.99 a day.  I asked for a $19.99 car and the site said there was no such thing, but they could get me a car for $35.99.  Huh?

  12. I agree that doing some research beforehand is necessary before you bid on Priceline. Of course, hotel rates on Priceline are supposed to be discounted, and this one wasn’t. Also, the “refund or cancel” clause is vague – what determines which one they do? Still, $119 is a great price for Hawaii, and she might not find anything better. Canceling might not be the best option.

  13. Just to be fair, I am not a fan of Priceline but really don’t see any problem here. Everything work as the deal and the contract stipulated. It’s a lesson (not costly) for the OP so next time the OP make the right move.

  14. Persistence pays off.  I too booked a Priceline Name Your Own Price (in Paris) and discovered a cheaper price on the hotel’s website.  What’s not being said in the article is that in places with literally hundreds of hotels, like Paris or Hawaii, the consumer will probably not check all of them and will only go to the website after the “successful” bid. That’s when the price issue first surfaces.  In other words Priceline leads you to the hotel and you then discover that you could have booked it directly for less money.  In my case I contacted Priceline immediately and continued to press them until all the excess payment was refunded.  That included the overcharge and their fees.  But, to be fair, almost always we have been thrilled with Priceline’s prices and we use them for booking most of our hotel stays.

    Rosanne Skopp

  15. I just took a quick 3 minute look at winning bids for this area. Most hotels near Honolulu with a higher star rating are going for the $80-100 range for this fall.

    The OP was happy enough with $120 to begin with, but NOW realizes she didn’t put any due diligence into it for herself and it trying to place the blame elsewhere.

    1. YOU know to use BiddingForTravel or BetterBidding, but they don’t advertise on TV like Priceline does. The casual tourist doesn’t know those sites exist. If Priceline advertises they’ll be saving someone money over a direct hotel booking, then the customer expects to save. 

      Here’s my speculation. It’s been a while since I tried Priceline, but I remember that after your first lowball bid is rejected, they suggest bids for you. So perhaps the OP wanted a certain star level in Hawaii and Priceline suggested she bid $120. She did, her bid was accepted, then she sees the price is less on the hotel’s own website. I’d be mad about that. 

      1. Google “how to bid on Priceline” and better comes up. (bidding for travel is not as good as it used to be) THAT is how I got started. A simple act of doing homework would have saved the OP.

        IF the scenario you mentioned happened occured, she would have been savvy enough to NOT get duped had she done the prep work.

  16. I use priceline for most of my hotel bookings and don’t pay more than $100/night for 4-5 star properties. I have booked in the past $60-$70/night rooms at Hyatt, Marriott, Westin, W etc in prime locations in San Francisco, San Diego, Washington DC, Chicago, LA. If I have a few weeks before the travel dates I start really low and may increase a bit every day by a little untill it is accepted. I think priceline gives you an opportunity for some serious savings if you are  patient. Also always start bidding with the highest star properties and work its way down if needed. And of course do your research before you palce a bid. 

  17. “Name your own price” only works when you can’t find anything lower than you anticipated.  Before going to Priceline, do a search on sites that give you the price upfront such as Expedia, Travelocity, Kayak, even the airlines travel pages.  These are the sites that search the hotel’s web pages for you.

    Don’t go to Priceline first, go there last.  This was a hard lesson learned for the OP – thankfully it wasn’t an expensive one.

  18. I’ve used Priceline a lot in the past year, and have never been ill-treated by any hotel staff simply because I paid a Priceline price.  Anything I asked for, I got, even switching rooms when I needed to (they were all awesome too), and this is spanning hotels from Portland, Maine to Dallas.  I mean seriously, even if I had been, I’m still staying at a 4 star for the price I’d be paying to stay at a Super 8, so you wanna abuse me, then abuse me.  Hurt me BAD, baby!  I’d happily put up with it to ensconce myself in the velvety luxury of a four star.

    And then I’ll just as happily lampoon the hotel on my blog.  >:-)  And Tripadvisor too, but of course.  And all my social networks.  And maybe take out a billboard ad bashing the hotel for being the work of Satan (with a break out pitchfork just for extra fun.)

    But seriously, I love this service, you just have to learn how to utilize it properly.  Fukumoto sounds like a novice in this regard, but if they had a guarantee, they shouldn’t have hid behind the legalese to worm out of refunding her.  That’s just sleazy.

    I use Priceline to stay at 4 stars for budget prices in major cities for a short time.  I do that fully expecting that if something goes wrong, I ain’t gonna see that money again.  But I can eat the potential loss of say, $50 to $100 for booking on Priceline.  BUT… would I use it to stay at a hotel for a week or more?  Oh HELL no.  Way too many things can happen the longer you stay somewhere, which is why the longer the stay, the more I’m likely to go full budget and only book where there’s a GOOD refund policy.

    I think you see an awful lot of complaints about Priceline because people don’t really understand the nature of this beast, but I’m sure once they did, they’d learn how to wield it more expertly as a money saving tool.

    Finally, even though I’d say I’d put up with ill-treatment, don’t let any hotel staff mistreat you because you paid a Priceline price.  The fact is, YOU ARE STILL HELPING THEM MAKE MONEY.  It’s not at all about what you paid but about an elitist attitude that’s a form of class racism (class-ism?)  You paid to use their hotel, you dang well should expect the same treatment as any other paying customer.  They give you a crappy room, you ask for a different room.  They still give you an attitude, you ask for their names and write it down.  And so on and etc, etc.  😀

  19. Why, for the love of God, does anyone use an opaque site? I can always make a better deal through simple research and phone negotiating.

    1. I have saved thousands of dollars over the years bidding on PL. I do my homework, bid and then stay. Unlike this poster, I bid a considerably lower figure than what I can get from the hotel. I know what i am getting into and can accept those terms.

  20. Call me cold, but the OP named the price, the price got accepted. Why should Priceline be responsible for the OP bidding “too high” of a price? When notified, they “matched” the price. Using Priceline doesn’t entitle you to a better deal, you have to do some research, and you don’t always win!

  21. Online services and guarantees are becoming the rip off of the internet. “I guarantee” the lowest fare. O prices cannot be “BEAT”. The work to correct a situation is not worth the “possible” savings. Use an ASTA travel agent that you can talk directly to, or sit face to face with and travel happier.

    1. It’s like a car dealership claiming to “match any price or you get the car free!”. Can someone PLEASE tell me when it is in the best interest of the dealer to give the car away free rather than match a price? (Yes..I know they will always find the slightest difference on a car and claim it’s not identical, but you get the point!)

  22. As others have mentioned, she “named her own price” and her offer was accepted.  I’m befuddled why she offered a price HIGHER than was published on the web.  She should have performed more online research.  She certainly is not an intelligent consumer.

  23. Price guarantees are gimmicks.  They are counting on most people not bothering to claim them.  After reading about all of the problems with these “cheapo” websites, I think most of us can do better with a little web surfing and diligence. 

  24. Let me try to understand this.

    She paid $120/night.
    She went on the website and found $119/night.
    She contacted Priceline.
    They refunded her $1/night.
    So now, she has effectively paid $119/night to be the same as the website.

    WHY does she want to cancel her reservation? If she goes directly with the hotel, it will cost the same. Or did she just not want that hotel once its name was revealed?

    1. I think she thought she should be getter an even cheaper price…which begs the question…”Why not bid lower to begin with?”

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