Setting and evolving ticket prices!

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Ticket prices are largely dynamic. The system in which airlines set ticket prices has given rise to countless myths.



Some of them refer to certain days of the month or week as the most suitable to buy the much desired plane ticket. Other myths refer to certain promotions that may appear around the day of the flight. There are also conspiracy theories that suggest that "cookies" are used by companies to manipulate the prices offered.

What is true and what is false?

What is true and what is false? How are ticket prices actually set? What is the best time to book a plane ticket? I try to answer all these questions in this article. Here's how airlines decide ticket prices.

First of all, there is competition between the passenger and the airline. The passenger wants to buy the plane ticket at the lowest fare, trying to make the best deal in terms of price compared to the travel period. But the airline also wants to make a profitable business by selling all the plane tickets.

It is true that the pricing system for airline tickets is a complex one, which can vary from company to company. All sorts of studies have been done that have indicatively suggested certain time intervals when prices would be lowest. But this differs from flight to flight, from one destination to another and depending on the period. So studies can provide guidance, but not 100% reliable.

It is true that airline websites use "cookies", but not to influence prices, but because a European / international law says so. We also use "cookies", but we do not sell plane tickets.

Ticket basket and fare classes

The company can make an optimal profit from a flight only when it has the lowest cost per passenger, and this can happen when all seats are occupied. So the desire of the companies is to sell all the tickets.

But taking a seat on the plane can't be done at any cost. No company wants to make too big discounts. Somehow, airlines have multiple purposes: to maximize income, flying with full planes, but also to sell as many tickets as possible at the maximum price. This is how the process called "yield management" comes about.

Airlines set some "baskets" with a certain number of seats for each one. At the same time, passengers have several fare classes available depending on the desired services. Thus, there are N fare combinations that the passenger discovers depending on the period in which he wants to travel.

As tickets are sold, performance managers monitor and adjust ticket allocation between different fare "baskets." If sales are below expectations, some tickets may be moved to the promotional area with discounted tickets. Such discounted tickets can appear at any time because they are part of the company's marketing strategy. It's a way to get attention all the time. However, the normal trend is to increase the price of tickets two or even three weeks before the day of departure.

When to book your plane ticket

Airlines announce operational programs twice a year: in the summer season for the winter season and in the winter season for the summer season. More recently, some companies are announcing the sale of airline tickets for next year.

Performance managers at airlines start looking at bookings about two months before the flight date. That means it doesn't really help to buy the ticket more than two months in advance. Well, there may be situations when the advance launch of the operational program comes bundled with very good prices and thus take advantage of the launch offer.

But initially the lowest prices are not available. If the performance managers find, two months before the flight, that the sales so far are below expectations, then they can move a few tickets to the "basket" with the lowest prices. Between two months and three weeks before the flight, the price offers remain about the same, with a slight upward trend. However, seemingly paradoxically, significant reductions can occur during this period. So, frequent price monitoring can come with some pleasant surprises.

No wonder RYANAIR, Wizz Air, Blue Air, TAROM, Lufthansa and many other companies periodically juggle the lowest fares. It's just that everything has a well-defined strategy behind it. These promotional prices may appear on certain days of the week, on certain flights, at certain times less interesting for the traveling public. It's all about the flexibility of the passenger.

Related to low-cost companies, here also comes the profit obtained from the related services that the company makes available to passengers. You can sell plane tickets at low prices, but the profit should come from luggage tax, catering services, sale of seats, etc.

Travel data flexibility

Some passengers are flexible and can take advantage of promotions to travel to certain destinations. I have often taken advantage of the tariffs of 5 or 10 EURO / segment. I had and flights at 19 bani / segment. There were moments when I chose to fly without taking into account the climate, the period, but only in terms of the lowest price. I love to fly!

Other people travel according to the holidays and thus the period limitation appears. In this situation, these passengers will have to look for the optimal price for the desired period. It may not be the cheapest plane ticket, but it's not good to leave on the last hundred meters.

There are also passengers who travel depending on the job, business interest, etc., most of the ticket purchase is made from one day to the next and, obviously, the fare doesn't matter anymore.

Conclusions on price developments

In conclusion, buy the plane ticket when you find it at the best price for your pocket. If you plan to travel during certain special periods of the year, such as Christmas or Easter, buy your plane ticket in advance. Surely prices will explode near the flight date. It is also good to buy your plane ticket in advance for the set holiday period.

Don't expect cheap tickets in the summer season for holiday destinations. Don't expect cheap flights around important events over the year.

As I have said many times, airfare is dynamic and can fluctuate from day to day. There are situations when rates may change from one minute to the next. The rate is influenced by supply and demand. The lower the supply and the higher the demand, the higher the price of airline tickets.

You can monitor your ticket prices for a few days. But don't leave everything for the last three weeks when you risk finding very high rates. Also, pay attention to what you have included in the price of the plane ticket. Compare airline tickets with all desired services from the airlines that serve the route. You may be surprised to find lower prices at full-service companies compared to low-cost companies when it comes to tickets with certain services included.

When it comes to buying airline tickets, in most cases we recommend that it be done from the websites of the airlines. Here we are talking about direct point-to-point flights. But there are many other situations when you can find very good prices on intermediate sites. For example, on kayak.com or skyscanner.net you can find good price combinations for multi-segment flights.

We do not have the complete algorithm, so there may be many other influencing factors that you have not yet discovered. The above information is for informational purposes only. We do not have the absolute truth, so it is helpful if you leave us comments with your experiences in purchasing airline tickets and how you have found that prices are evolving.

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