
Orbitz shows costlier hotel options to Mac users - Kenan
http://online.wsj.com/article/SB10001424052702304458604577488822667325882.html
======
suprgeek
It is important to read the article carefully:

WRONG - Mac users see higher prices for same hotels than Windows users

RIGHT - Mac users are sometimes also shown hotels that are costlier than their
windows users

"...so the online travel agency is starting to show them different, and
sometimes costlier, travel options than Windows visitors see."

~~~
starship
Regardless, it never ceases to amaze me how controversial pricing
discrimination is. Especially since most people have taken Econ 101: pricing
discrimination eliminates dead-weight loss, which should be a good thing
right? Nope, instant controversy.

~~~
gjm11
> _most people have taken Econ 101_

Er. Um. No, most people have not taken Econ 101. Most graduates have not taken
Econ 101. Most graduates in quantitative disciplines have not taken Econ 101.

Most people with economics degrees have taken Econ 101. A modest number of
other people have. Some more have learned the basic concepts by means other
than taking Econ 101. These are probably not the people complaining about
price discrimination.

In any case, being surprised when people are upset because they think they're
getting inferior treatment and saying "oh, but they should think of the gain
in overall economic efficiency" seems like a sign of, well, not having taken
Psych 101.

~~~
pavel_lishin
I took Econ 101 - but the only reason I did so was because it was one of the
only two classes available in high school that offered college credit.

If it didn't give me three hours of credit, I probably would have ended up
with Texas History, or something similar.

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mratzloff
It wouldn't surprise me. I've suspected for years that they do differential
pricing, but I got confirmation a few days ago.

I just bought tickets to Las Vegas on Friday. I got through the checkout
process (choosing a flight and a hotel) and then they said there was a
"problem" and kicked me back to the beginning of the process. I went through
it again, choosing the exact same flights (with the same number of seats
available) and the prices were 20-30% higher. The available seats were
identical (I was buying for a same-day flight so there were only a handful
remaining and it was easy to see that they were the same). I went ahead and
bought since it at was the last minute, but I made a mental note not to ever
bother coming back.

It's happened so frequently to me on this and other aggregators like
Travelocity that it may even be intentional.

Perhaps they display competitive prices so they will be chosen by people who
are comparison shopping (either manually or through a site like kayak.com).
Then once you've asserted your willingness to buy by moving through the flight
selection process they randomly restart you with higher prices on the
(probably likely) belief that you have already mentally committed to Orbitz.

~~~
derda
It is also possible, that they show you a cached price first and one step
before the confirmation they check back with the airline if they price really
is the same. In your case the airline might have increased the fare, for
whatever reason, shortly before you started your booking process.

~~~
mratzloff
That's definitely possible. I just have a hard time giving any company
involved (airline or aggregator) the benefit of the doubt...

------
aresant
Another interesting one is when Capital One showed different rates by browser
types by using a demographic study of wealth based on browser via
[http://www.conversionvoodoo.com/blog/2010/11/do-different-
we...](http://www.conversionvoodoo.com/blog/2010/11/do-different-web-browsers-
bring-different-demographics)

~~~
unfasten
The Capital One example actually turned out to just be normal split testing,
not based on the visitor's browser.

HN discussion thread about it: <https://news.ycombinator.com/item?id=1861037>

------
unreal37
I also find this fascinating.

As someone involved in creating recommendation systems for web sites based on
various user behavior signals, I can see adding a "what type of browser do
they use" and "what type of OS do they use" intelligence in the future to
further segment users.

Mac ownership must be a proxy for "household income". Brilliant.

~~~
mitchty
Would be easy enough to compare prices on windows/linux in a vm on my mac
though. And take note of the companies that do it. Something else to add to
comparison services as well, aka does site xyz.com discriminate based on
os/browser?

~~~
unreal37
Important note: the prices are not different. Just that more 5-star hotels are
shown in the search results to Mac users. If they were charging more for the
same hotel, it would be evil not brilliant. :)

~~~
bigiain
We were doing this back in early 2001 on this site:

[http://web.archive.org/web/20010722191804/http://travelmall....](http://web.archive.org/web/20010722191804/http://travelmall.com/)

We tried both adjusting individual prices for Mac users (and didn't see any
statistical difference from the price sensitivity for non-mac users, same as
we didn't see statistically significant differences between older and newer
Windows version users), and skewing the search result price range for Mac
users compared to non-Mac users (and we certainly saw statistically
significant improvements there in terms of average dollars per room-night). In
the long run though, although we proved to ourselves it worked, the Mac
userbase back then was so small that the overall bottom line effect wasn't big
enough compared to the engineering and marketing effort to keep it working - I
think it all vanished in the big 2004 rewrite of the site's back end.

------
abruzzi
Inevitably, this will make people like me (Mac user that considers $50 a night
overpriced) book through other sites. Does orbitz think I only price through
them? Most people I know price at least a half dozen locations before
deciding, so as long as everyone doesn't jack prices for Mac users, Mac user's
business will naturally migrate to whomever doesn't try to screw us.

~~~
citricsquid
If they believe Mac users are happy to pay higher prices they most likely also
believe Mac users are less prone to shopping around.

~~~
GoodIntentions
I bet they are right too.

I think mac users have demonstrated they are for the most part willing to pay
more for something they perceive as offering a better experience. You can't
make that choice if you're some broke dude surfing from a 400 dollar *nix box,
so I think it is given that average mac users are less price sensitive - the
more cash you have, the more your time is valued imho.

FWIW, posting this from a slackware box with my mac cooling in the next room.
So by all means, show me the cheap stuff first :)

------
eridius
Are they simply showing pricier offers, or are they showing the exact same
offers but with the prices raised? The former is annoying but not inherently
evil, but the latter would be terrible.

~~~
dmfdmf
In Econ, the latter is called differential pricing and there is nothing evil
about it at all.

[http://www.pricingforprofit.com/pricing-
explained/differenti...](http://www.pricingforprofit.com/pricing-
explained/differential-pricing.php)

~~~
InclinedPlane
That depends on your moral code, of course.

~~~
bigiain
We knew that _downward_ differential pricing worked (in terms of increasing
conversions) - a popup saying "Hi, you're a return visitor to our website, we
can discount this room rate 10% if you book today) _always_ increased
conversions.

We sure as hell _experimented_ to see if the decrease in conversions by
bumping margins (and hence prices) up was worthwhile in terms of total profit.

I'd happily make an argument that if the first is morally "OK" then so is the
second…

~~~
rwolf
Your phrasing here suggests that you work for orbitz or a similar company. Is
that accurate?

~~~
bigiain
Same field, but not since 2008. I was doing this in early 2001.

------
vishaldpatel
Does this means that Linux users get the best deals? Or maybe it's Windows
users with cracked copies of Windows.

~~~
dave1010uk
When the Humble Indie Bundles are on sale (where consumers can pay what they
want), the stats showed the average Linux user paid more than Mac or Windows
users.

~~~
jasonlotito
I don't think that necessarily carries over. For the most part, all the Linux
users I know contribute more simply because they want to encourage other
developers to create games for Linux. It's a point of price, they can point
at, and say "Hey, Linux users spent more then Windows or Mac users."

------
benmanns
Another curious statistic: according to the sales numbers on
<http://www.humblebundle.com/>, Linux users on average pay more ($12.50) for
the choose-your-price bundle than Mac ($9.99) or Windows ($7.98) users.

~~~
jlcx
I would guess that this is either related to user enthusiasm for more
professionally developed games (explaining why Windows users aren't as
excited), or a desire to support the creation of cool stuff and be part of a
community around it.

~~~
dave1010uk
Additionally (ceteris parabus) a Linux user would be richer as they have not
spent money on an OS (except the odd RHEL user). However I doubt this makes a
statistical difference.

------
kintamanimatt
I wonder how Linux users are profiled.

~~~
jbigelow76
Redirected to Airbnb of course.

~~~
kintamanimatt
I assume only Ubuntu users are so redirected.

Arch --> Ikea.

LFS --> a forest.

~~~
zalew
Debian --> a commune

------
ajays
It's not like someone at Orbitz sat down, rubbed his/her hands with glee and
said with an evil laugh, "ha! I will rip those Mac users off!"

In all likelihood, someone used the browser type as a feature in their model.
It so happens that Mac users are (or were) younger, slightly more financially
successful and like to splurge a little (e.g., the Mac itself, when comparable
Windows laptops are significantly cheaper). Hence the model learned that it
can show more expensive hotels to users with that specific browser type.

------
hnalien
Full Article -

[http://online.wsj.com/article/SB1000142405270230445860457748...](http://online.wsj.com/article/SB10001424052702304458604577488822667325882.html)

------
ghaff
Not that familiar with most of the hotel examples shown but, for Las Vegas at
least, both the hotel examples shown are pretty low-end Strip Casinos. (i.e.,
at least this example isn't about significantly different classes of
properties)

------
brackin
As a Mac user I hate this but I do think you should (on applications at least)
use different models for each platform. Angry Birds monetizes differently on
Android and iOS. This isn't a justification for Orbitz' behaviour though.

------
doh
"I don't understand the Orbitz debacle.

First, they're not charging Mac users more than Windows users for the same
hotels / services. All users, regardless of OS, have access to the same set of
options at the same prices. This is ad targeting, not price manipulation;
they're (essentially) showing Mac users different advertisements -- for
higher-priced options. You're free to not click on the ad; if Orbitz chose
wrong, they're losing money (by wasting ad space on their page)."

Rest here: <https://www.facebook.com/tudorb/posts/10100307597913113>

------
joshmlewis
I'm cofounding a startup in the travel space and our cofounder has a lot of
domain expertise and according to him it's illegal to show a rate lower on
Expedia than say Marriott.com. There are exceptions as always, but for the
most part this is true. Now I don't know if this applies to the opposite..I
guess you could just add to a price but I still would think that's fishy.
Anyway, just a little tid bit of knowledge.

Edit: Turns out they prices weren't different, just showing pricier results
first.

~~~
bigiain
"Illegal" is not _quite_ the right word.

When I got out of the online hotel booking game (back in '08) - all of the
major chains were starting to include terms like that in their contracts (or
had been for a few years), and were leaning on all the wholesalers
(Pegasus/Sabre/Gullivers/Octopus) to push and enforce those decisions on small
players (like us) who booked through them. Our lawyers said there was a
_strong_ chance that these contract provisions wouldn't stand up in court
(here in Australia), but it was obvious to everyone that it wasn't worth
getting into expensive legal fights with the suppliers of the "product" our
business relied on…

------
gurkendoktor
Amazon also shows costlier suggestions to customers who have bought costlier
products before. Orbitz is doing what they can with their comparatively
limited knowledge.

The ironic thing about this is that many airfare websites have a German
version with curiously higher prices than the US version, and that Apple's
computers themselves are more expensive in Europe. (Sadly I'm never sure how
much of this can be explained with taxes.)

------
w1ntermute
Screenshots for those of us stuck behind the paywall:
<http://imgur.com/a/VtNRf>

~~~
bmunro
Paste the article title ("On Orbitz, Mac Users Steered to Pricier Hotels")
into Google.

The Wall Street Journal article should be the first result. Click on it.

You should be able to see the whole article. The WSJ appear to give you the
full text when the referrer is google.

------
yo-mf
One interesting insight that was edited from the final article; Linux users
tend to not book hotels, but prefer building campgrounds from scratch.

------
yo-mf
You know which Mac users are NOT seeing those higher cost travel options?
Apple Store employees...

------
kika
The real question is who paid for this article - Parallels or VmWare :-)
Kidding.

------
badhairday
Paywall. :(

~~~
ctrl_freak
Protip: many paywalls, including this one can be circumvented by using
Google's URL redirection service:
[http://www.google.com/url?q=http://online.wsj.com/article/SB...](http://www.google.com/url?q=http://online.wsj.com/article/SB10001424052702304458604577488822667325882.html)

Simply use 'www.google.com/url?q=' and paste in the address of the article
which has a paywall.

~~~
damian2000
That's awesome, thanks .. how does it work? I mean why does it allow google to
bypass their paywall.

~~~
hristov
Because google does not like to index pay-walled articles. They are either not
indexed at all, or given a low score. This makes complete sense because Google
wants their users to be happy and users are usually not very happy when they
hit a pay-wall.

Online publications, on the other hand, really want their paywalled articles
to be indexed by Google. You may remember Murdoch did a lot of complaining
about this a couple of years ago. So now publications do a little trick where
they make the whole article available to people coming from Google but offer a
paywall to anyone else. This means that you can usually access the entire
article if you are redirected from google.

~~~
damian2000
Interesting, thanks. It seems counter-intuitive that they would allow all
users from google to see the full article, since that's where you'd imagine a
lot of traffic would come from.

------
wilhow
Does linux users get a lower price?

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jermaink
OS discrimination

------
rsanchez1
Well, Orbitz certainly understands its audience. If you're willing to overpay
on laptops, hopefully you're also willing to overpay on hotel stays.

------
uptown
Dear Orbitz - I'm done using you.

-Love Your Ex-customer

------
Kelliot
Good business model. Exploiting the higher disposable income / lower
intelligence of mac users for profit is awesome =)

~~~
jewbacca
I see you're a new user: this type of comment is, by consensus and executive
decree, not welcome on Hacker News. If you don't have something genuinely
novel to contribute to the conversation, please do your part to keep the noise
low.

~~~
RegEx
> by consensus and executive decree

Man, some people around here _really_ love the 'sound' of their own text.

~~~
adbge
Hell, _I_ love the sound of his text.

~~~
RegEx
And there's always someone there to appreciate the pretentiousness.

