Orbitz website now steering Apple users towards more expensive hotels
posted at 10:17 pm on June 26, 2012 by Allahpundit
Alternate headline: “Chump Apple fanboy blogger apparently paying chump Apple fanboy premium.”
When I heard about this story earlier, it sounded as if Orbitz was pushing different rates for the same hotel rooms keyed to your OS in the knowledge that Apple users on average earn more than PC users do. Not so. All they’re doing is tweaking the order of search results. If you’re a Mac user, you see ritzier hotels first. You can always re-order the results by searching by price.
Apple is practically creating its own demographic, and researchers are trying to define it. Their goal: to see if higher income levels translate into higher spending…
Orbitz found Mac users on average spend $20 to $30 more a night on hotels than their PC counterparts, a significant margin given the site’s average nightly hotel booking is around $100, chief scientist Wai Gen Yee said. Mac users are 40% more likely to book a four- or five-star hotel than PC users, Mr. Yee said, and when Mac and PC users book the same hotel, Mac users tend to stay in more expensive rooms…
Neil Sazant, president of Sagamore, reacted with a mix of admiration and concern to the algorithm. “That’s incredible, but I wouldn’t want to miss out on PC users,” he said. Mr. Sazant says about 15% of rooms at the 93-room hotel are booked through a mix of online sites like Orbitz and that appearing on the first page of results is important in those searches…
Apple users already stand out as big spenders. Nearly half of retailers in a recent study by Forrester Research and Shop.org said users of tablets—a large majority of which are iPads—tend to place bigger online orders than users of laptops or desktops. Shoppers on Apple devices like iPhones also outspend shoppers using Android or BlackBerry devices, accounting for half of all mobile purchases, according to International Business Machines, which tracks data from retailers.
Apple users make roughly $25,000 more on average than PC users. Jonathan Last wonders: Would there be anything illegal about using elastic pricing keyed to what make of computer a customer has? (That’s not what Orbitz is doing here, to be clear, but what if they were?) Any lawyers out there know? My hunch is no, but of course if lots of people started getting charged different prices online simply because of the particular on-ramp they’re using to access the information superhighway, the outcry would presumably force legislatures to spring into action. In fact, I assume this problem is to some extent self-correcting. Apple obviously has a profound commercial interest in its users not getting locked out of competitive prices online. If elastic pricing by OS became widespread, they’d either notify their users of which sites were doing it or actually build something into Safari to deter users from accessing those sites. (Needless to say, they’d also lobby the hell out of Congress to act.) That said, though, I wonder how long the income disparity between Apple and PC users will last. As mobile technology becomes more ubiquitous, the number of middle-class consumers snapping up iPhones and iPads will bring Apple’s income average down. At some point, the disparity will be small enough not to warrant elastic pricing. I wonder how long we are from that.
Exit question: What other computer data could a website use to gauge the average user’s income? Geography, obviously. What else?
Update: Actually, am I wrong about Apple going hard after websites that engage in elastic pricing? They’re not exactly a luxury brand now but they’re certainly a prestige brand. Maybe elastic pricing would nudge them towards embracing their status symbol potential and marketing to the rich. “Apple consumers: Paying 20 percent more online — and proud of it!”
Breaking on Hot Air