Airline pricing patterns
 

Hi,

I've been reading for awhile, but never posted. Everything on this board has been really helpful.

I've been United Premier before, then moved to Houston and switched to CO OnePass this year, and will just miss making Silver for my few months flying Continental.

I want to make sure I make silver next year, and I'm trying to book a few flights for early in the year. Using ITA I looked up a flight for March a week ago, and found prices around $160. Once I crossed the date three months prior to the flight, to price went up drastically.

I know airlines hold prices higher on far off tickets because people who buy them that early generally are doing it because they absolutely have to have them for something those dates (meetings, weddings, etc.).

Then, the prices seems to drop at some point out before the flight, then start slowing increasing again as you get closer to the flight dates.

Does anyone here know how this pricing scheme works? When is the best window prior to a flight to find the best prices? A month-6 weeks in advance, more, or less?

Thanks in advance,

Mike

Another reason they don't lower ticket prices by much a long time before a flight is that there's too much statistical uncertainty in how well it will sell. As it gets closer the airline can make a better estimate of how many cheap tickets it wants to sell to fill seats that would otherwise be empty. Since few bargain hunters book more than a few months out, this doesn't impact (enough to notice) its ability to sell those discount tickets.

Another reason prices go up as a flight gets closer is that people who book at the last minute, like the people who book well in advance whom you mentioned, also absolutely have to be somewhere. In their case it's usually a business meeting that just came up. Since these passengers are spending the company's money, they're often less sensitive to pricing than a vacationer would be. Deep-discount tickets usually have an advance purchase restriction of 7 or 14 days for this reason. There's nothing magic about the numbers 7 and 14, but the're in the right area and people are used to them.

A fare going up "drastically" three months out is unusual. I suspect some event was announced for your destination city and people started to buy tickets to go there. Airline yield management software picks up unusual purchase patterns like this quickly and responds to them, but its response is based on imperfect knowledge. If it turns out the number of people going to whatever isn't enough to fill the planes, fares will come down again.

The best time to buy a ticket? Hard to say. For really popular routes, like Hawaii in January, probably as early as practical. For flights that will be nearly empty, I'd wait until 2-3 weeks before, perhaps even hoping for a last-minute Web special. For the normal kind of route, your 4-6 week guideline is probably about right, but there's no hard and fast rule.

Recently I read an article/interview with the CEO of Lufthansa. He mentioned "..we change the fares 6,000 times a day ..." :cool:

It seems the day of the week matters
 

I've also found that fares on CO will go up on Mon/Tues, then be lower the latter part of the week. This is anecdotal, so I'm not sure as to the pattern, but the last ticket I purchased was like this. I checked on Thurs & Fri and it was low. When I checked again Mon it had spiked, same Tues. On Wed it was back down to Fri's low fare and I grabbed it. Interesting.

I followed the fare to Old San Juan on Continental for a while about a year ago, it usually would jump up about $100 on Saturday and drop back by late Sunday or Monday. I snapped up some tickets on US Air when they offered a sale fare that was about 1/2 the lowest CO fare. ;)

I know some airlines (DL for example) keep their prices high on routes they compete with WN until WN extends their schedule to cover those dates. Seeing as WN is only taking reservations through 4/1/05 right now, that may also explain why looking past March you are seeing fares very high.

I noticed the same thing.

Welcome to FlyerTalk Tulane41

This really doesn't have anything to do with miles or points, so I'm going to move it over to TravelBuzz!

Regards,

Flipside

There is a small company called Hamlet, based in Seattle and founded by a professor of computer science at the U of Washington, that is trying to replicate airline pricing patterns in algorithms in an attempt to be able to predict prices and tell a customer "the best time to buy." I'll see if I can find an old news article. Very interesting, though I don't know how they plan to make money... :D

Check early in the morning as most airlines' revenue programs are run nightly and lower fares may be available in the morning and gone in the afternoon. Also lower fare seats are not released every day so you need to be patient. Last Tuesday and IAD-TUS on UA was $525 with W fare out and V fare back, On Wednesday morning the price was $424 with W fare both ways, on Thursday $525 fare was back. It pays to be patient and check often and be ready to purchase when the fare you want comes available. Unfortunately, I am planning to upgrade and was waiting for miles to post so I could not take the Tuesday fare. Will wait until it comes available again.

I've read a similiar article where fares were tracked for the past three years or something. Based on those patterns the software could tell you in a general sense when a good time to buy was.

I try to track fares and graph them against time. After a few weeks, typically you'll be able to see trends (high, low and common prices in between). Also, it gives a sense of the volatility. If a fare changes rapidly, I don't sweet it when the price goes high, because it will likely come down, of course the opposite is true as well. The info helps get better fares, though I can't say it's helped me get a killer deal or see the future :)

Does anyone know if there is a website that provides the trend data for destinations that you are graphing on your own? It would be very helpful to have a reference point to know what is considered a really good price vs a really REALLY good price....