The economics behind "Basic Economy" – A masterclass in price discrimination

Post by sfifs » Tue, Jun 24, 2025, 11:51 PM UTC

slg wrote: post #51

djoldman wrote: post #10

It appears that taking advantage of human imperfections and irrationality are taking up more and more of companies' strategies and time. You've got folks thinking constantly about advertising, pricing strategies, dark patterns, network effects that prevent or discourage churn, etc., in ways that tend to exploit flaws in the consumer's decisioning process or gaps in their knowledge, to the consumer's disadvantage. It…

I think the biggest change in general corporate management in my lifetime was the deprioritizing of the concept of goodwill. I’m not naive, businesses have always prioritized profit. However, there used to be this idea that pure profit maximization ruined your brand and reputation. You didn’t want to be known as the asshole company that nickel and dimes everyone or has draconian policies that make people hate dealing…

Post by tekla » Tue, Jun 24, 2025, 11:58 PM UTC

pasquinelli wrote: post #19

onlyrealcuzzo wrote: post #9

Earlier quoted context omitted.

It's made it so that relatively poor people can afford to regularly fly all over the world, which is a relatively new thing. Lowe middle income people in lower middle income countries can afford to fly somewhat regularly, and even internationally, too. Flying used to be just for the rich only as far back as the 60s, and for nobody as far back as 200 years...

> It's made it so that relatively poor people can afford to regularly fly all over the world, which is a relatively new thing. has _it_? do what is _it_ again? >> All told, is all this chicanery benefiting airlines? i'm really curious how screwing passengers has done these things.

Post by carlosjobim » Wed, Jun 25, 2025, 12:10 AM UTC

kelnos wrote: post #67

ggm wrote: post #42

Earlier quoted context omitted.

I'm not saying you're wrong but this is also much the same argument as "why do I pay more tax when I am not using public health" or other community wide benefits. Philosophically you either believe in a price which benefits the community at large, or you want the lowest price outcome for yourself and others to be exposed to their costs.

I think then you have to provide a strong argument for why a particular product/service should be considered under the "community-wide benefit" umbrella. Public health is very clearly to me a collective good: I benefit from others being healthy in so many ways. Similar things can be said about funding schools; I don't have children, but I will benefit from the next generation of adults being well-educated. Welfare an…

Post by lmm » Wed, Jun 25, 2025, 12:32 AM UTC

walterbell wrote: post #93

dkjaudyeqooe wrote: post #77

Earlier quoted context omitted.

> All of the fat in the industry has been squeezed out I don't know where you live but in the US this is patently not true. Airlines are an abusive oligopoly there, with landing slots and the like cementing control of certain markets for certain airlines. Ticket prices are much higher than they used to be and are much higher than Europe (for instance).

Airlines have substantial earnings (greater than flying?) from credit card marketing and loyalty programs.

Post by djoldman » Wed, Jun 25, 2025, 12:59 AM UTC

wagwang wrote: post #39

Aren't flights at an inflation adjusted all time low and most airlines operating at a razor margin? Seems like the market doing their job. Also price discrimination sounds a lot worse than what it really is? Idk, I don't like that air travel is so easily accessible but, the pricing stuff is the least of our worries.