Air Fares 101 – Why do fares change all the time?
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Re: Air Fares 101 – Why do fares change all the time?
#2Good overview. Having worked at a GDS subsidiary and written about this topic, another thing to add is it depends on how many caches there are between you and the root database. Airfares are heavily cached so the data that is shown in search results is often stale; only the final booking (when you actually pay) is the real number. The more contention for seats as you get to the last few the more likely the final price can jump. For example, Google's flight data is very stale since they don't do any booking, they don't really have to update all that frequently, which means they can return results from their own cache fast.
Re: Air Fares 101 – Why do fares change all the time?
#3"We did that Uber shit before it was cool." -- The airlines.
Another thing that surprises most people is how expensive business and first class are, relative to coach. After all, if you're only getting 1.5-2x as much space, it doesn't seem fair that you'd have to pay 10x prices. The truth is that many of those seats are filled via upgrades to frequent fliers and more fairly priced in that view. But someone who asks for an assured first-class seat (which is where the 5-10x premium is charged) is identifying himself as a captive buyer. About half of the first-class seats are upgrades (especially to make room, because airlines often overbook) given that day, and those are cheap or free, but the other half are a mix of business travelers under time pressure, invited conference speakers whose flights are booked by a third-party, and people with disabilities. While people complain about the "assholes" in first class getting marginally better treatment, a surprising percentage of the people up there aren't rich at all, but have disabilities (e.g. back and knee problems) and can't fly coach, and those people fly once a year (!!) at most, because they can barely afford it. Perversely, the disabled guy of modest means is going to see a higher fare for a first-class seat than a business traveler on a corporate rate.
Oddly enough, air travel is getting to the point where airlines are intentionally making coach travel worse to make up for a decline of first- and business-class passengers since 2008. While one might think that the purpose of the checked bag fees is to make a little extra money (and that's part of it) there's a much larger gain in filling up the overhead bins (thanks to those horrid checked-bag fees, overhead bins always fill up early) and then selling early boarding for $50 per ticket. Waiting spaces at many terminals have been deliberately neglected for acoustics and outlets, to push people into buying first-class tickets just to have access to the lounges. Natural demand for first class seats hasn't recovered since 2007 and, even with the economy back, it won't, so air travel is now an experience where unpleasantness is deliberately induced.
Re: Air Fares 101 – Why do fares change all the time?
#4I was hoping for something that explained the part where they get you to pay a higher fare by tracking you on the Web. But maybe an insider site like this wouldn't be willing to talk about that.
There are many sites that describe this happening, such as [1]. And I've seen it happen to me: a fare would go up by $50 while I was searching, and opening a private browsing window would make it go back down.
[1] http://www.halfwayanywhere.com/budget-travel/your-guide-to-c...
Re: Air Fares 101 – Why do fares change all the time?
#5I was hoping for something that explained the part where they get you to pay a higher fare by tracking you on the Web. But maybe an insider site like this wouldn't be willing to talk about that. There are many sites that describe this happening, such as [1]. And I've seen it happen to me: a fare would go up by $50 while I was searching, and opening a private browsing window would make it go back down. [1] http://www.…
The all inclusive branch also does this, you search a nice holiday, get hyped, tell your family or mates, and when you get back a day later it's suddenly 200 euro's more..
Re: Air Fares 101 – Why do fares change all the time?
#6Maybe to point out that the number of seats in a fare bucket doesn't need to change at any second for the displayed fare to change. For most airlines, the fare buckets are not independent and bookings in one bucket may decrease availability from other buckets. These formulas make it unnecessary to change the number of seats allocated to each bucket all the time. Most changes you see during the day are just the result of new bookings and cancellations that are coming in live.
The volume of pre departure cancellations can be crazy for some routes to a point people wouldn't even believe.
Re: Air Fares 101 – Why do fares change all the time?
#7"We did that Uber shit before it was cool." -- The airlines. Another thing that surprises most people is how expensive business and first class are, relative to coach. After all, if you're only getting 1.5-2x as much space, it doesn't seem fair that you'd have to pay 10x prices. The truth is that many of those seats are filled via upgrades to frequent fliers and more fairly priced in that view. But someone who asks f…
"if you're only getting 1.5-2x as much space, it doesn't seem fair that you'd have to pay 10x prices"
Business aren't obligated to offer you prices that you think are fair. I don't understand why people think they are. When people say something is a rip-off or unfairly priced what they really mean is that they aren't willing to pay that price for the product.
What a business chooses to charge you is entirely up to them, and they can be as rational or irrational in your eyes as they like.
Re: Air Fares 101 – Why do fares change all the time?
#8In the states, the more I deal with cellular companies and airlines, the more I hate them.
It's not just me: it's a common opinion. One prominent business magazine had a cover a few years back titled something like "The companies we all hate"
Consumers like to purchase things in atomic units and simple terms. If I go to the grocery store, there's a bushel of apples. The sign says "Granny Smith apples: $1"
I can confidently pick up an apple, walk to the register, and expect to pay a dollar. The grocery store can advertise their wares and prices in the paper or online and I can plan on going to the store and making the same exchange. People like being able to predict how much of one thing they have to trade for an amount of something else. When lots of competitors do this in a market that anybody can participate in, it's good for everybody.
But when I buy an airline ticket? The rules are many times so byzantine that entire cottage industries have sprung up in an effort to capitalize on them. How much does it cost to fly coast-to-coast? Beats the heck out of me. There is no answer. Could I pick up a job where I had to fly ten times from point A to point B with a few day's notice and be able to include travel costs in the price? No, not unless I were to charge up to 17 times the cheapest rate.
Complex pricing systems may be great for the airline, but they're damaging to the free and open market. Instead of using rapidly-changing yield management systems, we'd all be better off if they just used an cross-carrier auction with transferable tickets. Let downstream providers handle liquidity.
I doubt this will happen, and instead there will be more penny-pinching, crazy rates, and unhappy customers.
Re: Air Fares 101 – Why do fares change all the time?
#9I was hoping for something that explained the part where they get you to pay a higher fare by tracking you on the Web. But maybe an insider site like this wouldn't be willing to talk about that. There are many sites that describe this happening, such as [1]. And I've seen it happen to me: a fare would go up by $50 while I was searching, and opening a private browsing window would make it go back down. [1] http://www.…
I've only worked a little with the inventory back end so you can take what I say with a grain of salt. Different points of sale can have different yields and report different available seats in each class of service. So the price for a travel agent or a partner airline can be different. If a website detects you are searching for a holiday flight, and are back, they could switch the point of sale that they give you quotes from.
Re: Air Fares 101 – Why do fares change all the time?
#10"We did that Uber shit before it was cool." -- The airlines. Another thing that surprises most people is how expensive business and first class are, relative to coach. After all, if you're only getting 1.5-2x as much space, it doesn't seem fair that you'd have to pay 10x prices. The truth is that many of those seats are filled via upgrades to frequent fliers and more fairly priced in that view. But someone who asks f…
People buy first class tickets just for the lounges? Usually, you can just pay $30 or so for a day pass to a lounge.