Seat Auctions Rake in Revenue for Airlines

Way back in the good old days, people flying on planes with a lot of empty seats could theoretically get an upgrade to a higher class for free; that perk is no more, though, with the advent of bidding programs that allow airlines to auction off their empty premium seats to the highest bidder through an app.

Once upon a time, it was marginally easy to talk your way into a free upgrade to a premium seat if a bunch were empty. Unfortunately, that perk doesn’t really exist anymore. A company called PlusGrade launched in 2009 and put an end to the practice.

PlusGrade allows airlines – it partners with more than 70 – to auction off their empty premium seats in an eBay-style bidding war. Flyers download the app and enter their preference for how much they’d like to pay for a premium seat on a certain flight. The airlines then manage the whole process, more or less determining who wins the seat.

Now, PlusGrade is focusing less on the auction aspect and more on the ability to get as much money as possible for an auctioned seat. Sometimes customers end up paying more than what they’d pay if they just bought the seat straight out.

“We want to make sure that as the door closes, every possible dollar has been earned and passengers get a better experience,” Chris Engle, PlusGrade’s chief commercial officer, told Skift. “We are happy the airline is selling more through traditional channels, so what we are saying is, ‘if there is one or two, let us get you a lot of money.’ We help them get their yields up.”

[Photo: Shutterstock]