Wednesday, March 07, 2007

the intricacies of airfares - part 1

i don't understand how airfares are priced. i'm sure there's some economic model that determines when they go up and when they come down, accounting for factors such as the busyness of the travel dates, length of time between booking date and travel date, fixed duration promotions, competitors' price movements and the like.

i also don't understand the value of travel agents in the travel industry when it comes to booking (simple A-to-B-and-back type) flights. i've long stopped bothering to contact travel agents for domestic flights, heading straight to the likes of the virginblue and jetstar websites when i need to fly. the last time i tried to book a domestic flight at flight centre, i was quoted a much higher fare on a qantas flight than what i had already found on a vb flight. when i mentioned this, the consultant checked the vb website, and i ended up making the booking with vb. but what really happened was that the flight centre person made the booking for me on the vb website, and when i asked what the difference was between her doing that and me doing exactly the same thing at home on my own computer, she muttered something about their lowest price guarantee and arranged a $10 refund to my credit card.

the web has also become my first port of call for international flights. i used to book through one particular travel agency because the boss/owner is a family friend, and has authority to give some discounts. however the last few times i've done the brisbane-singapore round trip, i've consistently found that the lowest price i could get was direct from the airline's website (in my case singapore airline). not even the likes of zuji or union shopper's travel service could compete in sourcing cheaper prices than what my buddy firefox and i found with a few mouseclicks. so the moral of this story is: book directly with the airline if you can, as this cuts out the middle man and associated costs.

having said this, i saw that zuji's price for the qantas flights were slightly less than the price you get from qantas' websitef! go figure... so the moral of this story is: don't immediately book directly with the airline, but first see if the middle man is offering discounts/incentives.

in the end, i went with british airways, as they happened to be having a sale (half price tickets!) just when i was about to book. so i scored :) the funny thing with this is that although these BA flights are actually operated by qantas, the equivalent qantas flights (same physical plane, different code/flight number) were still at about $11K. so the moral of this story is: when a flight has multiple personalities, seats may vary significantly in price depending on which 'person' you speak to.

i first found out about the BA special via an smspup advertising email. the prices it mentioned half shocked me from my morning not-quite-wakefulness, and i was rejoicing at such a find of cheap tickets available for the dates i wanted to travel. at $760 (including tax) for the return flights, who wouldn't be happy when every other airline's starting price was something in the $11-12K range. but i had to go to work, and didn't have time to check into conditions etc and make the actual booking, so left it for after work. when i got home, the cheap seats were no longer showing! i was spewing big time at the thought of missing out on such a rare bargain, particularly as the price of the singapore airlines flights i was originally intending to book had just gone up. thankfully, the next morning i saw the special prices available once more for my desired dates - this time i couldn't get my credit card out fast enough. so the moral of this story is: when you see a bargain, carpe diem!

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