Dynamic pricing trial

Old Jul 4, 19, 6:56 pm
  #1  
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Dynamic pricing trial

This is an excerpt from a presentation by Air NZ's Chief Revenue Officer at their Investor Day presentation earlier this year:

"... revenue management has been facilitated historically through algorithms and software, global programs which look at historic demand patents and then forecast forward what we believe the market will do. Now in the future, this is ripe for a disruption, and we've been working with a company called Fusion RM based in the states. And they will take all that historic data, but they will also look at polling data from the GDSs which travel agencies use, our websites and all other websites to actually give us a much greater understanding of future demand. So there's some really, really exciting pieces of work which are going to drive our thinking in terms of revenue management and how we can extract better returns using the capital and the assets that we have.

And this will mean real dynamic pricing. So instead of our fares being layered and laddered using letters in the alphabet, we will have a different price point for every different customer, for our Airpoints members for our golds, for our gold elites. So that's a tremendous opportunity for us and something that we will start a proof of concept on a couple of city pairs by the end of this calendar year."
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Old Jul 4, 19, 7:05 pm
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" a tremendous opportunity for us"
Translation: gouge existing customers, especially those with Airpoints status, who may not look for other options
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Old Jul 4, 19, 7:13 pm
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I don't care that there are precedents for this. I think it's disgusting.

It looks like a future of trying to search anonymously, and searching as seldom as possible for your desired dates, to avoid them inflating prices.
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Old Jul 4, 19, 7:14 pm
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While NZ had stayed clear of true dynamic pricing, they've already been doing many things that get pretty close to it.

Married fares are already a nightmare for international connections, and pricing changes multiple times per day for domestic flights already is not uncommon. I was chatting to somebody a few weeks ago who ended up booking 3 flights for travel the following day as pricing got cheaper throughout the day and then rang and cancelled the most expensive 2.

The example I posted a few weeks ago about A class availability which verges on dynamic pricing as well.
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Old Jul 4, 19, 7:23 pm
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Originally Posted by sbiddle View Post
While NZ had stayed clear of true dynamic pricing, they've already been doing many things that get pretty close to it.

Married fares are already a nightmare for international connections, and pricing changes multiple times per day for domestic flights already is not uncommon. I was chatting to somebody a few weeks ago who ended up booking 3 flights for travel the following day as pricing got cheaper throughout the day and then rang and cancelled the most expensive 2.

The example I posted a few weeks ago about A class availability which verges on dynamic pricing as well.
I find that better as everyone at a moment in time gets the same price.

Its when it moves to showing different people at the same moment in time different prices where it gets iffy for me.
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Old Jul 4, 19, 8:21 pm
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Already happening I think, have been looking at ADL/AKL round 23 Dec and prices already over double and climbing. Annoyingly dummy booking shows plenty of seat avilability, so feedup have just dumped using them and booked with VA at $250 cheaper with full service which is worthwhile even with a short stop in Melbourne..
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Old Jul 4, 19, 8:32 pm
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Originally Posted by ClanJ View Post
Already happening I think, have been looking at ADL/AKL round 23 Dec and prices already over double and climbing. Annoyingly dummy booking shows plenty of seat avilability, so feedup have just dumped using them and booked with VA at $250 cheaper with full service which is worthwhile even with a short stop in Melbourne..
I think that's just Air NZ going crazy.

I've also looked at Air NZ pricing to Aussie for Xmas and it's insane. Over NZ $1400 seat only R/T on the dates I was looking at WLG-MEL direct.
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Old Jul 4, 19, 9:13 pm
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Originally Posted by sbiddle View Post
I think that's just Air NZ going crazy.

I've also looked at Air NZ pricing to Aussie for Xmas and it's insane. Over NZ $1400 seat only R/T on the dates I was looking at WLG-MEL direct.
Often finding it cheaper to fly QF J on AKL-BNE-AKL than NZ in the works lately on peak dates.
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Old Jul 4, 19, 9:38 pm
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Wow I can't believe the fares for the dates I was looking at.

Airfares for the Xmas period are normally around $900ish R/T, and my experience busy dates getting up to around $1100 R/T WLG-MEL

Looking at a comparison now for the dates I was looking at NZ are $1,432 for seat only, QF are $1,322, and SQ are $1,182 (leaving a day later on the 27th but same return date). Prices are even higher some other days (SQ are $1,582 for a departure on the 24th) but the average across that whole period on NZ is probably around the $1200 mark for a R/T.

Here I was thinking I would head over there for Xmas rather than going to CES in Las Vegas but it's only $2500 to go all the way to Las Vegas at the busiest time of the year!

I've simply never seen pricing this high ex WLG before.
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Old Jul 5, 19, 12:54 am
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On the flip side, if I keep on searching a date, and the fare it comes up with uniquely for me is too high, but I keep on searching the same search, do you think it will figure out the price is too high, and so lowers it so it might meet my price expectation. Almost like a reverse auction 😂

Wishful thinking...
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Old Jul 5, 19, 2:34 am
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Count down to the first scandal where people of X ethnicity, gender, age are charged more by this amazing system...
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Old Jul 5, 19, 3:22 am
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[sign out, clear cookies, activate VPN]

Buy Air NZ ticket

[/sign out, clear cookies, activate VPN]
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Old Jul 5, 19, 3:28 am
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Originally Posted by Thai-Kiwi View Post
[sign out, clear cookies, activate VPN]

Buy Air NZ ticket

[/sign out, clear cookies, activate VPN]
Surely you would not need to do that if you are not using www.airnewzealnd and not having your Airpoints membership number logged in at the time of search?
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Old Jul 5, 19, 3:36 am
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Originally Posted by Blackcloud View Post
Surely you would not need to do that if you are not using www.airnewzealnd and not having your Airpoints membership number logged in at the time of search?
They will fingerprint on IP, browser characteristics, typing or mouse speed, screen res, local timezone from browser, tracking via the third party JS, etc
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Old Jul 5, 19, 4:03 am
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Originally Posted by Katamarino View Post
Count down to the first scandal where people of X ethnicity, gender, age are charged more by this amazing system...
Except it will older, white men who are charged more. And it won’t be a scandal in the eyes of the “woke” - rather some kind of social justice ...
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