What is the meaning / definition of Auction Site in the hospitality industry?
A auction site is a website, where the price of a product or service is determined by the winning bid. The auction site allows the user to name their own price for any posted products or services within a certain time frame. The price rises depending on the bidding people. The person who bid with the highest price within the set time frame will be the winner.
This tool is often used by Hotel Revenue Managers to sell unsold inventory at a lower price, in an opaque way.
Examples for an auction site are: Ebay, Name Your Own Price (Priceline), Hotwire, eBid, Webstore.
Auction sites like Priceline are able to get the clients a significant discount while not advertising directly the price of any particular hotel. Instead, they let the customer bid on a star-rated range of hotels in a specific area. Hotels which want to fill up their property are willing to let rooms sell at a much lower rate.
- Opaque Fences
- Auction Site