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Delta’s new AI-powered pricing strategy

blog.getjetback.com

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Re: Delta’s new AI-powered pricing strategy

#61

Post by planetpluta »

dortlick wrote: post #53

Don't we already have individual pricing on lots of things like used cars, contractors doing work on your house, car insurance, etc? Most people that work in sales have some ability to adjust pricing based on their personal judgement of the customer(mark). Do you think there's not discrimination by a contractor when they come into your house and size you up and what they think you are willing to pay or maybe they jus…

I’d say two big differences are 1) human vs machine (especially when you get to the scale of something like Delta airlines) and 2) you have a lot more power in the negotiations you described! Basing it on 5 years of purchases and historical data isn’t a negotiation—it’s a “my way or the highway”

Re: Delta’s new AI-powered pricing strategy

#62

Post by usefulcat »

fmobus wrote: post #58
usefulcat wrote: post #49

Seems like there's a relatively simple solution for this: allow airline tickets to be resold. Apart from the fact that this restriction massively benefits airlines, I've never understood why it's not allowed. No matter what, you still have to go through security and present your ID there, so the additional security benefit of knowing a traveler's identity at the time of purchase seems pretty marginal.

If resale was freely allowed, you'd get a ton of middlemen skimming the margins, i.e. arbitrating. Like we have with concert tickets now.

That only works with concerts because of severely constrained supply. There's only one Taylor Swift, and she can only perform so many times each year. Yes there's probably no shortage of artists in general, but they're not interchangeable (certainly much less so compared to airlines). The air travel market is, therefore, not nearly as constrained.

I dunno, ticket reselling might not be strictly better, but it seems unlikely to be worse and at the very least it would be nice to have the option of selling your ticket if your plans change. As it is, you generally either have to pay extra in advance for that privilege, or just eat the loss. Either way it's great for the airlines, therefore not great for consumers.

Re: Delta’s new AI-powered pricing strategy

#63

Post by bb88 »

This is end-stage capitalism, where the corporations become cartels. They're no longer happy with making a profit based upon providing good competition based upon efficiency gains. They are looking for profit maximization at any cost.

Re: Delta’s new AI-powered pricing strategy

#64

Post by darth_avocado »

eastbound wrote: post #29
morkalork wrote: post #20

Earlier quoted context omitted.

Assuming their model is accurate at predicting economic value and assuming that the wage gap between men and women still exists, wouldn't it be relatively straightforward to show men as a group are quoted higher prices?

Men aren’t a protected class. I’m not sarcastic: They really are not, it’s legally ok to charge men more.

If you are getting a different treatment purely because you’re a man, then you can absolutely sue and win.

Re: Delta’s new AI-powered pricing strategy

#65

Post by giantrobot »

belter wrote: post #11

Relax, the ticket isn’t $4,999 because you’re broke, it’s pre‑success tax on your inevitable successful exit. They do see your YCombinator IP after all. Or...open the site in Lynx on an old ThinkPad. The fare will drop by half.

If you fly a lot it might pay to get a pre-paid Android beater from CVS to use to buy tickets.

But this is our future boring dystopia. We're not going to get the post-scarcity future from Star Trek but the techno-feudal hellscape of cyberpunk novels. Hooray technology!

Re: Delta’s new AI-powered pricing strategy

#66

Post by beeflet »

louthy wrote: post #57
usefulcat wrote: post #49

Seems like there's a relatively simple solution for this: allow airline tickets to be resold. Apart from the fact that this restriction massively benefits airlines, I've never understood why it's not allowed. No matter what, you still have to go through security and present your ID there, so the additional security benefit of knowing a traveler's identity at the time of purchase seems pretty marginal.

Ticket touts on the most popular routes? No thanks!

why not? let the market decide the price

Re: Delta’s new AI-powered pricing strategy

#67

Post by nradov »

usefulcat wrote: post #49

Seems like there's a relatively simple solution for this: allow airline tickets to be resold. Apart from the fact that this restriction massively benefits airlines, I've never understood why it's not allowed. No matter what, you still have to go through security and present your ID there, so the additional security benefit of knowing a traveler's identity at the time of purchase seems pretty marginal.

Airlines have zero financial incentive to allow ticket resales. This would only happen under some sort of government mandate.

Re: Delta’s new AI-powered pricing strategy

#68

Post by chollida1 »

righthand wrote: post #37
chollida1 wrote: post #35

Earlier quoted context omitted.

Interesting thought. What specific protected class is "harmed" by personalized pricing? And how would you prove that the model discriminated against them based on a protected element?

All of them as they’re being used to compete and discriminate against each other.

That's not really how it works in the US. You have to prove that you were dicriminated against based on a protected class.

Everyone getting different prices doesn't mean its illegal:)

Re: Delta’s new AI-powered pricing strategy

#69

Post by buyucu »

nradov wrote: post #51
buyucu wrote: post #41

Earlier quoted context omitted.

I travel around the world a lot, and Delta was by far one of the the worst airlines I have ever taken. I doubt they 'charge extra for slightly better service'.

Delta's strategy might fail but that's what they're trying to do. Delta is mainly competing against American and United, and to a lesser extent against Southwest. Whether Delta is worse than Singapore Airlines or Emirates or something doesn't really matter.

it is true that airlines in the US are generally a bit trashy.

Re: Delta’s new AI-powered pricing strategy

#70

Post by red-iron-pine »

Hilift wrote: post #18
jawns wrote: post #2

The Civil Rights Act requires companies not to discriminate against legally protected classes. That includes both disparate treatment and disparate impact. I can't see how "personalized pricing" would remain unchallenged, given those hurdles, if it truly means pricing fares based on individual characteristics. It's totally fine to have loyalty programs that reward people who fly Delta frequently with better rates. Bu…

There's complexity here that could sway a court. A few years ago, we engaged an AI company to identify potentially problematic hospitality customers. Those were required to check in in person at the front desk instead of the app. Sounds like it could fail those tests, but those tests are for humans and this is AI!

the second it leaks that "potentially problematic hospitality customers" disproportionally target a minority you and the AI company will be sued aggressively from all sides.
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