An Analysis of Consumers’ Reactions to Travel Websites’ Discrimination by Computer Platform

Abstract

A study of 124 consumers found distinct differences in the consumers’ responses to a policy once used by Orbitz, in which prices were determined according to the computer platform used to search for bookings. The policy arose when Orbitz noticed that Macintosh users were generally willing to accept higher prices than PC users. This observation was converted into a price discrimination mechanism. The study found that Mac users took a dim ethical view of this rate fence and, moreover, indicated that they were less willing to use Orbitz as a result. Men and women in the study reacted differently from each other, however. Men expressed more outrage when they were Mac users, while women were more likely to consistently view this form of price discrimination as unreasonable and of questionable ethics. Since the hospitality industry uses many price discrimination rules, two implications of this study are choose rate fences carefully and consider explaining the rationale for any price discrimination policies.