Cheap flights search is exhausting. Passengers have to spend hours on Internet researching and comparing price deals of various airlines. Trying to figure out the pricing mechanism of airlines that seems random. Ticket price appears to fluctuate without reason and longer flights aren’t always more expensive than shorter ones. So sometimes traveler hit and many times runs out of luck. Because they don’t figure out behind the ticket pricing science runs is dynamic pricing. Which less to do with cost and more to do with artificial intelligence.
Let’s take a rundown how it works and how can we find cheap flights:
Evolution of Airlines industry:
It’s been more than a hundred years when in 1914 first commercial flight has been flown from St. Petersburg, Florida, to Tampa, Florida. Initially Commercial aviation industry is tightly regulated industry. Where ticket price was calculated on the bases of distance travelled rather than demand. Most international routes were operated by national flag carriers. This monopoly resulted in uncompetitive fares to the Passenger. In 1978 US Government started removing the regulations over the international routes and restraining the new entrants in the airlines industry. Within next 5 years new airlines setups and by the early 1990 competitive airlines industry established. Initial years of the liberalization of Aviation industry was competitive. Many airlines merger happen in this ear for dominating the market. All this intense merger and acquisitions Airlines industry turned from monopiles to the unregulated cartels.
Increase in demand:
During these 30 years new generations grown up and travelling by plan become a regular means of travel. In Till 2018 only four airlines. American airline, Southwest, Delta and united airlines control the 68% of the market share and serve 78 million travels between these four airlines. While ticket price was falling between main travel hubs. The lack of competition and reduction in flights resulted higher average airfare for smaller and less competitive cities. But all these phenomena weren’t halted the demand of air travel and number of airlines Passengers has been increased all over the globe and grown to 2 billion till 2022.
Big Change in Pricing Strategy:
Despite steep surcharges and baggage fee tacked on during 2007-08 oil shock, Ticket prices aren’t actually focused on combined cost such as taxes and fuel. Instead, airline price strategy called airline revenue management. This system of pricing focused on capping the revenue. So, when a customer book a seat, Airline determine the price they see by analyzing a wide range of factors including the status of their entire network. Off course pricing decision made my human, but deploying the algorithms adjusting the fares by using information like past bookings, Remaining capacity, Average demand of certain routes and probability of selling more seats later.
Categories of Passengers:
Airlines often means placing Passengers into one or two groups Business and Leisure and the way each grouped price is very different. Assume an airline offering route from London to Thailand can assume passenger on that route are largely holiday makers. So, Airline place them into leisure bracket. These passengers usually book a ticket months in advance and airline tend to start price of these seats relatively high. It tends to adjust the price according to the market response. Airline make sure through Algorithm to maximize its profit to high enough. But low enough so that it doesn’t result its unused capacity. While on typical business route such as London to Hong Kong. Airline start its price from Low to fill up the minimum capacity then it increases price steeply for Business travelers who tend to book last minute. Here Airline knows the Passengers on this route are less price sensitive compare then its leisure counterparts. Infect Business travelers are willing to pay 60% on average to secure the seats.
Role of Cookies in search of Cheap Flights:
There is wide believe that cookies you are accepting while searching the ticket prices helping airlines algorithms to analysis your buying behavior and they adjust price accordingly. Offering various options and testing on the basis of data available in your internet browser cookies. This why they increase the prices to push them to make a buy decision. But Solid prof of this practice is hard to come by and it’s something airlines and price comparison sites strongly deny. Targeted dynamic prices however can increase customer satisfaction and encourage consumer bookings. Although i am beliver of this but mostly experts beleive this.
Airlines Loyalty Programs
Almost all Airlines have programs for customer retention programs by different name some called it frequent flyer some named it as Loyalty program. For these programs you have to signup first and they offer you pricing windows according your purchasing history and buying behavior. Many airlines offer you miles point to claim on your next purchase instead of offering straight discount.
How to Finding the Cheap flights:
Technology allowed airlines to offer some tailor-made ticketing option and new business category shaped up like low-cost carrier. With minimum amenities to compete with minimal services that lower fare is the key if full-service carrier wants to appear on the first page of search engines like google flights. But its not only the Airlines using the AI technology for their advantage, User also have access to the site which are using algorithms and past data to forecast the Cheap price the ticket will reach and send the alerts to its user for the cheap flight. The Threat cheap flight search sites pose to the airlines dynamic pricing system even witnessed by united Airline suing the website skiplagged which helps the passengers to find the Cheap flights. But now its algorithms fight for Air fare. Passenger Can find the cheap flight according to their budgets through these platforms like Cheap Hotel and Flights. Just setup alerts and you will notify when the air fare come or near by your set budgets. It will be more cost effective for consumers to book their trips.
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