This Sunday we offer three tasty treats for your thoughts. With customized pricing being pitched by the airlines, is it good for consumers? Are you ready for the hotels to start adding ancillary fees to what was once a simple transaction? And, we ask, why are airlines withholding ancillary fee pricing from travel agents? Are they cutting off their nose to spite their face?
Airfares could vary depending on who is traveling
International airlines are proposing a new system of selling airline tickets that would include, among other things, the ability to customize pricing. Not customization that we, the customers, request, but personalized airfares based on what the airlines want to consider.
Plus, airlines are collecting more and more data about you to help them provide the perfect price for your airfare — not based on your preferences, but on what airlines think you would be willing to pay.
It is just plain creepy.
Now, according to a New York Times editorial, most of the world’s big airlines have OK’d a new pricing system, and the result is that passengers could be offered different fares depending on “how regularly they fly, where they live and the kind of trip they are taking.” Instead of fares rising or falling based on when the ticket is being purchased or whether the seat is in coach or business class, other more “personalized” factors will be incorporated, so that the results of your flight search could be much different than your business traveler neighbor.
Barrage of fees is starting to follow fliers to the hotel
Hotels are taking a page from the ancillary fee playbook pioneered by airlines. If passengers already don’t like the nickle-and-dime games being played at airlines, they should brace themselves for more of the same kinds of fees from hotels.
…when I checked into the Hilton Bayfront Hotel in San Diego, the clerk asked me if I wanted to pay an extra $20 for a room with a better view.
The hotel also charged $13.95 for basic Internet service and $19.95 for faster-speed service, which is not uncommon for higher-price hotels. In the business center, the charge for using a computer was $6.95 for each 15 minutes, an impressive $27.80 an hour.
On my bill at checkout, in addition to the basic nightly room rate of $260 and $27.50 in taxes, there was a daily charge of $5.20 listed as SD TMD Assessment. The city treasurer’s office describes that as a fee “to promote events and tourism in San Diego” that is levied specifically on hotels, which have the option of passing it on.
Incidentally, when I checked out a day earlier than originally planned, I was told the “early departure fee” was $75. I protested, and the front-desk clerk checked with a manager and dropped that charge “as a one-time courtesy.”
For biz travelers, timing of air ancillary offers is key
It seems that business travelers want to purchase many of the ancillary services now offered by airlines. That begs the question: Why do airlines make purchasing these services so difficult, selling them only on their own websites? It would seem to be far better for airlines to release these ancillary fees and services so that all ticket agents could sell what the market is now demanding.
These airline roadblocks to data and software development make tracking and managing these ancillary sales enormously difficult for corporate travel agents and travel management companies who deal with thousands of business travelers. And ultimately, withholding data slows the development of technology that could make airlines far more money than they can by hoarding their data.
In a survey of 902 business travelers, more than half, 52 percent, said they would consider buying inflight amenities and services if they were offered on their mobile devices before boarding, according to FlightView, which specializes in day-of-travel information for travelers.
Almost as many travelers, 45 percent, have already made ancillary purchases on a mobile device.
Illustration from CanadianBusiness.com