Contrary to common belief, the fare you pay when flying typically has little to do with how far you’re flying. Long trips often cost less than short trips and flights of the same time and distance can have radically different prices. Airline pricing is complex and often confuses and upsets travelers. The prices, which change by the minute, the difficult rules and restrictions that always seem unreasonable, and the huge disparities in price for even just different days of the week, leave travelers spiraling in a black hole of questions.
The days of government regulated flight prices based on flight lengths are no more! It use to be the longer the flight, the more fuel needed, and the longer the staff hours, the higher your fare. Today, a great many factors – including the length of your flight, the length of your trip, the airports served, how far in advance you book, what day of the week you book on, what days of the week you book for, what time of year you book for, whether you book around holidays and what rules or restrictions apply –ultimately decide your fare fate.
The airlines want to be able to have their cake and eat it, too, and they go to great lengths to make that possible. They employ a very high-tech strategy called yield management which intentionally aims to charge different prices to different passengers in order to maximize the total revenue collected for each departing flight. Airlines set and change fares based on whom they believe will fly where and when. The Wall Street Journal once reported that a trip from Washington DC to Hartford, Connecticut may be far more expensive than a flight from DC to Barcelona, Spain, simply because airlines expect the DC to Hartford route to attract mostly business travellers.
Also, last-minute tickets provide a very similar example. As your departure date approaches, airlines don’t lower prices to fill their last few available seats, actually the opposite! They jack up prices hoping last-minute buyers will be desperate travellers or business travellers, and will have little choice other than to book anyway. In addition to that, selling 20% of the remaining seats for a high fare is more profitable than selling half of them for the regular fare fraction of the fare.
Airlines don’t have just one fare – they have several fares for each seat and they use sophisticated techniques to maximize the number of people who have to pay the higher of those fares. For example, the same seat on a flight could be listed as costing anywhere between $110 dollars to $1700 dollars. Naturally you’re probably thinking that this is a no-brainer and you would go with the lesser expensive of the two. However, it’s not that simple.
Airlines will add restrictions to the lowest fare, which will limit how many people, can take advantage of it. For example, the $110 fare may require you to purchase your ticket 21 days in advance and fly on a Tuesday, Wednesday, or Saturday – which are the least desirable travel days. Other fares are blacked out around holidays and other peak travel times and, generally speaking, the lower the fare, the more restrictions there will be on it. Also note, that even if a fare is offered on a certain flight, the airlines will limit the number of seats available at that fare level. Making the lower fare undesirable in the end or impossible to choose for your specific travel needs.
If all of this sounds complicated, you’re right, and in practice, it is even more complicated. Airlines actually have computer programs that are constantly monitoring flights, analyzing booking patterns, and in real-time changing the number of seats available at each fare level. This is why it is not uncommon for fares on a particular flight to change on a daily, sometimes even hourly, basis.
So when is the best time to book for the best fare? As we mentioned earlier, Tuesdays, Wednesdays and Saturdays are the cheapest days of the week to fly, as they are the most undesirable for business travellers and therefore are not very busy for the airlines. In addition, if you’re okay with a less convenient departure and/or arrival times, the better your chances of paying less, since most people prefer to leave at 9am, instead of 5am, or return before 8pm, not 11pm.
Understanding these basics will increase your chances of paying less for your flights in the future. We believe that you should know all your options and rights when it comes to flying. Whether that is what you’re eligible for when bumped off a flight, how to get compensation for lost luggage, or how to choose the lowest fare possible.