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Airlines Could Soon Start Charging Different Fares for Different People

As dynamic pricing schemes with ever-improved algorithms come into play, published airfares could soon be tailored to an individual passenger’s travel habits and willingness to pay.

Commercial airlines already know a lot about their passengers. The likelihood is high that each carrier knows the travel habits and basics demographics of the frequent flyers and the infrequent leisure travelers alike on each and every flight on their schedules.

Now, it seems the airline industry is intent on using that information to decide exactly what sort of an airfare to offer individual air travelers. According to recent reports in the media, airlines are closer than ever to tailoring fares to each traveler based on travel habits, brand loyalty, demographic information and, perhaps most importantly, their willingness to pay the asked-for price.

“2018 will be a very phenomenal year in terms of traction,” John McBride of the e-commerce consulting firm PROS told Travel Weekly. “Based on our backlog of projects, there will be a handful of large carriers that move toward dynamic pricing science.”

McBride’s firm is already working with major airlines around the globe including Etihad, Air India and Air China to help carriers to set optimum fares in real-time. According to PROS, factors including “customer buying behaviors” are used to “accelerate sales results through dynamic pricing across different passenger types including groups and corporate sales.”

Meanwhile, Amadeus IT Group unveiled a revamped New Distribution Capability (NDC-X) system this week which it says will revolutionize the way airlines sell and price tickets. The NDC-X system, which was designed in conjunction with the The International Air Transport Association (IATA), will allow airlines, travel agents and booking sites to use data to tailor airfares in ways that were inconceivable only a few years ago.

“NDC holds great potential for the travel industry, and is part of a bigger picture of digitalization as airlines and travel sellers are testing new ways to adapt their businesses and improve services provided to the traveler,” Amadeus VP Julia Sattel explained in a statement announcing the public launch of NDC. “At Amadeus we are working hard to solve our airline customers’ technology challenges in areas such as merchandizing, dynamic pricing and cloud servicing, which we see as the heavy machinery in the background which will make NDC and improved retailing a reality.”

According to the Charlotte Observer, these new dynamic pricing technologies could amount to a sort of “surge pricing” for some air travelers. For example passengers using a corporate credit card could see only airfares that are priced substantially higher than those presented to a first time flyer.

[Photo: Shutterstock]

Comments are Closed.
KimchiExpress March 1, 2018

They already are using this model. The price I see when using fresh cookies is more than when I log in with my account. So instead of jacking up the price for certain individuals - they jack up the price for everyone and offer discounts to certain individuals. Also noticed price differences when using VPN and overseas. Also noticed flight availability was different when using an "Incognito Window" on Chrome (no cookies and other info sent to server). And as Broston said - it is alive and well with FF tickets. This is "American Business". Everything revolves around manipulation and corruption.

broston March 1, 2018

I am convinced that Delta has been doing this for some time - at least with award tickets. A friend and I sought an award ticket LGA-MSP-LGA. On my laptop the price was 35K miles. On hers, 65K. And this was true repeatedly as we both rechecked over the course of a morning. She is a Delta Medallion member who always flies Delta. I fly whichever airline offers the best price, time, connections. So Delta was "penalizing" her because they knew that ultimately she'd choose Delta?

lizzie March 1, 2018

Any "enhancement" that targets a specific population group becomes profiling. The risk to civil liberties is huge.

phillychuck March 1, 2018

Just use a VPN and don't log in before you select the flight (presumably a price would be shown before logging in).

DirtyDan February 28, 2018

It's already been well disclosed that certain airlines will jack the price of your ticket up when their computer recognizes your browser's cookies... As Fizzer said, always best to search "anonymously". Then book the ticket after the price has been disclosed. And as others have suggested about booking with OTA, I would wager that you've never had a flight issue because once you do, you'll never use non-invested middle-man again!