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April 5, 2011 4:36 PM   Subscribe

Help me understand airline bookings - when and why they vary the price.

I travel regularly to the Netherlands from the UK to see my girlfriend, and I'd like to do it as cheaply as possible!!

However, booking flights seems to be a pain in the ass:

* The times that are best for me would involve flying out with one airline and flying back with another. However, a one-way flight costs double the amount of a return. Why do airlines price it this way? I can understand an incentive for flying the same airline there and back, but why so huge a markup for a one-way trip?
* I was looking at KLM yesterday, and it was about 220 euros for the return trip next weekend - with lots of flags saying 'last x seats available at this price'. I check tonight and it's changed to 160 for the return. What the hell is going on here - is KLM just putting 'only x seats available' to make people book now?

Help me understand when and why flight prices change - tell me the tricks that the airlines are trying to use. Yes, I already know that weekends where bank-holidays feature are going to be expensive, that's not the issue - it's the normal weekends i'm trying to save on :-)
posted by BigCalm to Travel & Transportation (5 answers total) 6 users marked this as a favorite

The reason the prices change all the time is mainly due to Yield Management. If they think there's a run on seats for a flight, its price will go up. If they think it's not going to fill, they'll drop.

One-way flights cost more because they figure you really need to make the trip and since there's no guarantee they'll fill your seat on the return leg, so they might as well charge you as if you had.

On top of that, though, there are all sorts of website shenanigans. Here's one example: If you visit the RyanAir website and price a flight, then price it again the next day from the same browser, often the price will go up a chunk. Remove your cookies and try again, and the price will be back to normal. In that case, they think you'll see the prices going up and up and want to book quickly before they skyrocket.

If your dates are flexible, what you want to do is work out what the airline's floor price for your flight is. This is the price they never go below for public sales. Then when you see a flight at that price, buy it. If you don't, hang on until the last minute. If it drops, buy it. If it doesn't, cancel the trip that weekend.

The return thing's harder to get around. Maybe book both airlines return and have one weekend of perfectly timed flights and another of totally suboptimal ones. Or just don't fly the return legs at all, if it still works out cheaper. I suppose the ferry's out? :)
posted by bonaldi at 5:17 PM on April 5, 2011

Best answer: Yield Management.

Airlines change their pricing all the time and their systems are model the max revenue (and margin) per flight. It is complex, but they'll charge more for a one way ticket because people will pay more -- the tend to be business customers not spending their own money, or consumers that don't have a choice and have to pay it. They'll also consider what the competitors are offing for the fare.

An airplane will have a number for fare codes. A few at the supersaver/maximum discount/maximum restrictions, a few other rate codes and the default full fare refundable price. There's all these codes in inventory. And between people buying seats and the airline adjusting both the fare at each rate code and the number of seats at that rate code make it so hardly anyone pays the same amount on the flight.

I check tonight and it's changed to 160 for the return. What the hell is going on here - is KLM just putting 'only x seats available' to make people book now?

Yes and no. KLM wants to give you the sense of urgency to buy now. But it is based on how many seats are left at that rate code for that flight. Look at all these rate codes. So if the 160€ is rate code K and there's 4 left when that page loaded, that's the truth. But if the next day, the KLM reduced the number of seats in that rate code (or they were sold) you'll see a different price. Some rate codes have restrictions (must buy 21 days, 14 days, 7 days in advance) and there's other adjustments.

The result? It is a crapshoot to buy a seat on the plane. Great for the airline, bad for you. But in general, you should try and book 14+ days out. Use sites like Kayak to see if you can find the cheaper days around your trip. If you're flexible you'll save money. If you're stuck with the dates, you'll pay more. It doesn't have to be a holiday weekend to be expensive. All weekends will be expensive if you're going to places people go on holiday. To game the system, you have to be super flexible. Everyone flies out on Friday for the holiday, so you need to leave Thursday. Everyone comes home on Sunday so you need to come home on Monday or Tuesday. Lots of business people fly on Monday and Fridays and they pay more than tourists so it is never cheap.
posted by birdherder at 5:18 PM on April 5, 2011

I asked a question about yield management a few years ago. Got some interesting answers
posted by JPD at 5:20 PM on April 5, 2011

Response by poster: The result? It is a crapshoot to buy a seat on the plane

Yes, that's what I figured. Book early, book flexibly and you can have your flight cheap. If early or flexible is not an option, expect to pay a lot more.

I'm tempted to try and write a little perl web-scraper to work out patterns. That SMSs me when I can book the flights really cheap :-)
posted by BigCalm at 8:25 AM on April 6, 2011

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