Among all the entrepreneurs in the e-commerce industries, standing firmly in the middle of the post-September 11th commercial fray is one Richard S. Braddock.
As chairman of name-your-own-price Web site Priceline.com (Nasdaq: PCLN), Braddock continues to show the acumen necessary for longevity in Internet retailing.
If anyone really needed proof of that resolve, they need look no further than just after the September 11th terrorist attacks, when Braddock took the bold step of nixing his plans to sell off his Priceline stock, opting to buy 750,000 shares instead.
If corporate confidence works from the top down, Braddock’s move must have sent a warm glow throughout Priceline.
No False Pride
So how will Braddock answer the inevitable critics who will say he has allied himself with AOL simply because Priceline could not do it without someone bigger and tougher? Most likely he will ignore them.
The truth is that the early days of e-commerce will likely be remembered as a time when too many inexperienced company owners believed the only way to find success was to go it alone. The quest to prove their companies’ viability in the marketplace often took precedence over what could have been smart co-marketing agreements and strategic alliances.
False pride often got in their way, and today most of them are history.
Walking The Walk
As for Braddock, when he bought the above-mentioned stock, he said he did it because he was “confident that Priceline.com is ready and able to weather the current slowdown in travel, and will emerge a winner in the e-commerce space over the long run.”
That would have been just so much rhetoric, had Braddock not backed it up by putting his money where his mouth was.
Was it a realistic expectation that online travel could show itself to be as resilient as Braddock hoped?
That remains to be seen, but having surpassed its own estimates for the third quarter of this year, the company expects to break even on a pro-forma basis in Q4.
Priceline’s Wild Ride
These results are somewhat amazing, especially considering that just last fall the company was considered by many industry insiders to be ripe for acquisition.
Cendant Corporation had just acquired Cheap Tickets, and USA Networks had aggressively moved in on Expedia.
Priceline was a company that two years ago was trading as high as US$162 a share. By the fall of 2000, that figure had plummeted to a single digit. If an acquisition was not imminent, then a merger of some sort surely seemed inevitable.
The Power of Diversification
Braddock had other ideas. Even after the terrorist attacks that nearly crippled the travel industry, Priceline’s boss not only kept the company on course — he cautiously expanded and diversified.
In October, for example, Braddock & Co. announced a new joint venture with First Alliance Bank, PricelineMortgage. With the U.S. government’s lowering of interest rates, mortgages were bound to be a volatile and potentially lucrative business. Braddock most likely saw the mortgage business as a way to bolster the bottom line of his volatile core product, travel.
Success is Contagious
This week’s deal aligning Priceline with AOL is nothing short of brilliant. AOL, currently boasting more than 30 million subscribers, is prime territory for Priceline.
And try as it might to promote itself as an online media company and portal, AOL is writing the book on electronic commerce. In October, AOL reports, subscribers visited [email protected] to the tune of $2.7 billion, an increase of about 80 percent over last year’s revenue.
While Priceline is not the first or the biggest to the AOL travel channel — Travelocity (Nasdaq: TVLY) holds that distinction — it is the only name-your-own-price entity.
Nicely done, Mr. Braddock.
Note: The opinions expressed by our columnists are their own and do not necessarily reflect the views of the E-Commerce Times or its management.