He says it took a year to launch airline ticket sales, six months for hotel rooms and three months for car rental. Gross profit is what's left of revenue before paying overhead and is used as a barometer for valuing Internet stocks. Priceline forecasts that it will have 10 million customers by year's end vs. 4 million now. Whether or not you like William Shatner's lounge singer ads for Priceline, they are effective. Priceline says it will double its ad spending in 2000 from last year.
Word of mouth is powerful marketing too.
Priceline is attracting high-profile, experienced management. Heidi Miller, former CFO for Citigroup and one of the most powerful women in the business world, joins as CFO later this month. In January, Priceline named Gap executive Michael McCadden as its marketing chief. This has investors, who have seen how richly B2B exchanges are valued, salivating, says Ryan Jacob, manager of Jacob Internet Fund. I've thought this stock was undervalued for six months,'' Jacob says.