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Revenue Management Follies--Method or Madness?

Revenue Management Follies--Method or Madness?

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Old Nov 30, 18, 2:01 pm
  #16  
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They could be debating canceling the flight and don't want to sell discount tickets where it may be impactful to other flights to reaccommodate passengers.

Or it could be a new flight that was just loaded and the inventory hasn't been assigned. To be safe, they only open a couple high buckets until they can figure out how they want to sell it.
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Old Nov 30, 18, 4:19 pm
  #17  
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Originally Posted by Often1 View Post
There are hundreds if not thousands of these threads published about AS and every other air carrier in the world. They all revolve around a central theme, e.g. that the air carrier is nuts to sell Ticket X for $Y. The post then accuses the carrier of "gouging" for charging what a purely market-driven system sets the price at. It's not gouging.
"Gouging" is an opinion, not a fact. I'm fine if you disagree with my opinion. Of course, if you were looking at the route and that fare to buy, your opinion might be different. Notably, there is an AA flight that leaves about an hour later selling for $120 which might call into question AS RM's assessment of the market, but of course I don't know what (or if) they are thinking. There is also the question of bad IT that has been raised in other contexts, which was another reason I noted this particular fare. Some of the other explanations for why AS might intentionally set such an apparently anomalous fare make a lot more sense than the simplistic "hey, it's a free market" theory.
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Old Nov 30, 18, 5:14 pm
  #18  
 
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You can't really gouge if your competition isn't. If there's a $120 AA fare, then, problem solved.

It's not so much that AS set a high fare, it's that they didn't make any low-priced inventory available. The reason could be anything from a mistake to some algorithm thinking that this makes them more money overall (remember that their goal is not to fill every seat, but to make as much money as possible). Maybe they are right, and maybe not. If AA has lots of $120 inventory available then I'm thinking that AS probably messed up, but, who knows. Maybe AA messed up. Maybe they are going to sell all those cheap tickets and in January there are going to be a bunch of people looking for tickets and willing to pay the full fare Y, and they are going to lose out on $450 fares because they sold a bunch of $120 fares in December and their plane is full.
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Old Nov 30, 18, 5:53 pm
  #19  
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Originally Posted by channa View Post
They could be debating canceling the flight and don't want to sell discount tickets where it may be impactful to other flights to reaccommodate passengers.
This. We've seen this before as routes are about to get the axe. The flight is probably on the chopping block.
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Old Dec 1, 18, 9:10 am
  #20  
 
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Originally Posted by sturges View Post
The other day I was hunting for a LAX-SEA flight and everything was ~$70 the whole day EXCEPT for the horrible redeye (midnight-3a) which was only available in full Y. I fly that terrible flight somewhat frequently and many times I'm the only one who isn't an AS employee heading home. So RM does weird stuff sometimes.
Maybe employees flying on positive space drives down the number of seats to force the remaining seat(s) to full Y or some other weird combination of effects?

Last edited by chrisl137; Dec 1, 18 at 9:27 am Reason: insufficient coffee before typing
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Old Dec 1, 18, 9:47 am
  #21  
 
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Originally Posted by sturges View Post
The other day I was hunting for a LAX-SEA flight and everything was ~$70 the whole day EXCEPT for the horrible redeye (midnight-3a) which was only available in full Y. I fly that terrible flight somewhat frequently and many times I'm the only one who isn't an AS employee heading home. So RM does weird stuff sometimes.
Next time this happens, try clearing your browser cookies and re-doing the search. "They listen, you know..."
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