Orbitz Worldwide Inc. has found that people who use Apple Inc.'s Mac computers spend as much as 30% more a night on hotels, so the online travel agency is starting to show them different, and sometimes costlier, travel options than Windows visitors see.
...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.
"We had the intuition, and we were able to confirm it based on the data," Orbitz Chief Technology Officer Roger Liew said.
I use Windows machines, so I guess I'm OK. But there's more.
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.
Why? It might be income differences (assuming hotel stays are normal goods).
The average household income for adult owners of Mac computers is $98,560, compared with $74,452 for a PC owner, according to Forrester.
This is just another example of third degree price discrimination because Orbitz has successfully separated consumers into groups based upon the computer they use. This will undoubtedly upset some Apple users, so it will be interesting to see how the competition responds.
***Update: After thinking about this and talking with some friends, I'm now convinced this is not an example of price discrimination of any kind. To be price discrimination, different people have to pay different prices for the same product and the differential cannot be cost-based. Orbitz is giving customers search results based upon the price of the hotel rooms and the computer used in the search. It is not charging different prices to different consumers, but it is giving them different products (the search results) based upon a signal (the computer used in the search) that identifies the type of hotel the customer may want (pricy or budget).
Will this rub some customers the wrong way? Maybe, but not necessarily (and maybe not likely). If a person uses the room price as a signal of room quality and the person prefers higher quality to lower quality, then giving the person more costly hotel room options at the top of the search results would provide him/her with a better list. The person won't even consider staying in budget hotels, so why bother listing them and essentially making the customer filter through them?