Airline passengers today stand in numerous lines, are crowded into small seats o

Question

Airline passengers today stand in numerous lines, are crowded into small seats on mostly full airplanes, and often spend time on taxiways because of air-traffic problems or lack of open gates. But what gripes travelers almost as much as these annoyances is finding out that the person sitting next to them paid a much lower fare that they did for their seat. This concept of revenue management results in ticket pricing that can range from free to thousands of dollars on the same plane. Figure 13.7 on page 539 in the textbook illustrates what passengers recently paid for various seats on an 11:35 a.m. flight from Minneapolis to Anaheim, California, on an Airbus A320.

Make the case for, and then against, this pricing system. Does the general public seem to accept revenue management? What would happen if you overheard the person in front of you in line getting a better room rate at a Hilton Hotel? How do customers manipulate the airline systems to get better fares? What experience have you had with airline fares?

Explanation / Answer

Does the general public seem to accept revenue management?

Yes, in general people accept revenue management, the price of the ticket is as much as someone is willing to pay, and there are times where you can get a ticket for a really low price, if you are willing to wait until last minute and with a big chance on missing the flight because is overbooked. But if you need to take the flight then you will pay regular price because you really need to get somewhere.

People know there are times in the year like Christmas for example where the prices are sky high because everyone wants to travel and they are willing to pay more money for their sit, also there are places where no matter what time of the year is, you will have to pay a high amount because of the distance.

What would happen if you overheard the person in front of you in line getting a better room rate at a Hilton Hotel?

I would asked him how he got the rate. Perhaps he missed the flight or he booked it before I did.

How do customers manipulate the airline systems to get better fares?

One technique is constantly check the website of the airline for rates, another one is that there are websites where you can compare the flight prices between companies on an specific date for your destination, this allows you to choose the best flight, if you are willing to do stops and stay a couple of hours on airports you can get really good prices. You can also go to an airport and wait for the last minutes to purchase your ticket hoping the flight is not full and you will get a huge discount but is more likely that the flight is overbooked

What experience have you had with airline fares?

I have been able to purchase good tickets through websites that compare prices between airlines. So far I haven’t had the opportunity to try to purchase a last minute ticket but I will try one day.

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