Extra costs on flights

[JohnC6]

I was reading about how airlines..eg Ryanair easyJet and Wizz Air are pulling in record revenue from selling baggage space and other extras as families face increasing costs for holidays. It won't just be to cover increased costs to the airlines (fuel,inflation etc) but, I assume, they're trying to recoup Covid restriction losses, too. This week easyJey said that so-called ancillaries ..that will be 'extras' to you and me..lol..."continue to grow with yield increasing 20% year on year adding that they were 85% up compared with the same period in 2019. Anyone logging onto the luggage allowance pages of these three airlines will see that they state that you can add a bag "from" £5.99 but the reality is often very different. A travel correspondent said they won't share what prices could reach but he's heard they can reach to more than £30 to book an upfront seat which comes with faster boarding. Amazingly,. Wizz Air state that a 10kg bag can range from €5 in low season to €71.50 in high season.

That's the scenario for my question. They are using algorithms which use probability and mathematics to gauge the likelihood of somebody purchasing extras. My question is.. how ? What would the criteria be and to what end ? What can they do with their results ?

I'm aware that algorithms are used on Google , Facebook and the like but I don't know how they work other than send you to websites that sell shoes if you Googgle for shoes..I think. Algorithms are a mystery to me.

 

[Craig1912]

Not sure about algorithms but Easy Jet is upfront with any extras and if you book Essentials it is very clear what baggage is included and that’s what we always do. it’s not difficult

Essentials​

• One small under seat cabin bag (max 45 x 36 x 20 cm)
• 23kg hold bag
• Standard seat

 

[Mr Bump]

we went to canaries over xmas and new year and bryanair were the cheapest even with a 10kg cabin bag it is what it is

 

[JonathanRyan]

I was reading about how airlines..eg Ryanair easyJet and Wizz Air are pulling in record revenue from selling baggage space and other extras as families face increasing costs for holidays. It won't just be to cover increased costs to the airlines (fuel,inflation etc) but, I assume, they're trying to recoup Covid restriction losses, too. This week easyJey said that so-called ancillaries ..that will be 'extras' to you and me..lol..."continue to grow with yield increasing 20% year on year adding that they were 85% up compared with the same period in 2019. Anyone logging onto the luggage allowance pages of these three airlines will see that they state that you can add a bag "from" £5.99 but the reality is often very different. A travel correspondent said they won't share what prices could reach but he's heard they can reach to more than £30 to book an upfront seat which comes with faster boarding. Amazingly,. Wizz Air state that a 10kg bag can range from €5 in low season to €71.50 in high season.

That's the scenario for my question. They are using algorithms which use probability and mathematics to gauge the likelihood of somebody purchasing extras. My question is.. how ? What would the criteria be and to what end ? What can they do with their results ?

I'm aware that algorithms are used on Google , Facebook and the like but I don't know how they work other than send you to websites that sell shoes if you Googgle for shoes..I think. Algorithms are a mystery to me.

Propensity modelling is really interesting. They could be using it in lots of ways.

For one thing, people booking a flight to a ski resort in winter will probably have more luggage than a beach resort in summer so they will pay more for baggage because it's cheaper than renting it.

For another, certain people are more likely to pay extras. You could speculate that fliers with babies are less likely to pay for a certain seat than 40 year old men traveling on their own.

My guess is that if they are tuning their upgrade prices to the person/flight, they are probably letting AI/ml do it. They train the model on their vast history of inflating ticket prices and ask the machine to figure out who they can charge more and how much.

 

[lindsay]

As Jonathan says, it's very interesting in a theoretical way. An algorithm is a computer program, or more precisely a complex mathematical equation (because typically the code for AI looks more like maths than business logic). So in an ideal world, you take "big data" (loads of past bookings for example, with associated personal details of travellers), and look for patterns in it - sets of features of a booking that keep occurring with a relatively high frequency. From those patterns, you can deduce (a) common traveller types and associated features such as likelihood to pay extra for certain things, and (b) opportunities to offer further features to lower-frequency pattern members that might draw them into a higher frequency set of extras-buyers.
I've never programmed AI except many years ago when on a university course that I really struggled with, but I did get the concepts.

 

[boogie man]

It’s all quite simple.

You set the price for what the costs to the business are, plus a reasonable bit extra for profit.

Then you quadruple that price during school holidays.

 

[JohnC6]

Propensity modelling is really interesting. They could be using it in lots of ways.

For one thing, people booking a flight to a ski resort in winter will probably have more luggage than a beach resort in summer so they will pay more for baggage because it's cheaper than renting it.

For another, certain people are more likely to pay extras. You could speculate that fliers with babies are less likely to pay for a certain seat than 40 year old men traveling on their own.

My guess is that if they are tuning their upgrade prices to the person/flight, they are probably letting AI/ml do it. They train the model on their vast history of inflating ticket prices and ask the machine to figure out who they can charge more and how much.

As Jonathan says, it's very interesting in a theoretical way. An algorithm is a computer program, or more precisely a complex mathematical equation (because typically the code for AI looks more like maths than business logic). So in an ideal world, you take "big data" (loads of past bookings for example, with associated personal details of travellers), and look for patterns in it - sets of features of a booking that keep occurring with a relatively high frequency. From those patterns, you can deduce (a) common traveller types and associated features such as likelihood to pay extra for certain things, and (b) opportunities to offer further features to lower-frequency pattern members that might draw them into a higher frequency set of extras-buyers.
I've never programmed AI except many years ago when on a university course that I really struggled with, but I did get the concepts.

Many thanks Both.

Jonathan...When my wife books our holidays..she's very good at admin so she does it all.....she gets us seats forward of the wings so I can photograph out of the window and avoid the engines and also the heat shimmer/haze from them. I know we have to pay extra for that but that's ok. Maybe I should mention these are package tours so, it's not the likes of Ryanair-Wizz Air and easyJet. The reason I mention it is that these options are on the website at the time of booking, we have never had a direct approach from Jet2 nor Thompson who we usually travel with. In the summer it will be with BA (citalia travel company) to Milan for Lake Maggiore and we've already paid the extra and secured seats forward of the wings..I check the configuration. Nothing on our booking form would alert them to my wish to photograph out of the window .Having said that, as we've travelled with them several times before we would be identified as wanting those forward seats or at least window seats but anyone wanting them would have to pay extra so I assume it's the same with those three non-package airlines...ie no contacting the passengers. So..are you suggesting that having identified who they think would be open to extras they contact them ? You gave an example of the skiers and their equipment. I'd have thought all they have to do with their online pricing for flight destinations close to ski resorts is state it costs so much extra to take on board the skis and poles. So, if I've understood you correctly identifying such people..along with the 40 year old single man and his desire for a particular seat, will only give them a pointer, so to speak, along with other identifiable categories of travellers who would likely pay for extras to give the airline an idea of what they can expect the income to be from a particular flight. or, do you think they would actually Email these potential income sources ? If they don't I wonder why they use algorithms ? The extras are there online for every flight no matter the category of passenger. If their algorithm identifies passengers who would likely avail themselves of extras then unless they contact them offering the extras they think they might want to avail themselves of I don't see the point of algorithms identifying them . Of course, having no knowledge how the booloking systems work maybe I'm missing something.


Lindsay..As I've mentioned to Jonathan, Jet2 and Thompson will have our travelling history..it will be a first with BA in the summer..so you're right with your suggestion that traveller -history will play a vital role but as I've pointed out to Jonathan knowing the likelihood of a particular passenger wanting to pay the extras to secure a particular seat..it's usually that..isn't going to make any difference. I think the other 'extra' /surcharge with Ryanair is a family with small children wanting to be seated next to or adjacent to each other...no matter where in the plane . I've always thought that particular aspect of extras was unethical exploitation..All exploitation is unethical,really but you take my point. In contrast, a hen party group don't need to be seated near each other so a surcharge if they do is ok. The children need to be with or in a seat on the other side of the aisle to a parent. That's why, unlike Michael O'Leary, I'd never make a successful plane operator or even a businessman generally. .lol.

Maybe someone reading this thread who has actually had an airline Email/telephone them with the offer of extras could answer this aspect of it all ?

 

[JohnC6]

It’s all quite simple.

You set the price for what the costs to the business are, plus a reasonable bit extra for profit.

Then you quadruple that price during school holidays.

It will ever be thus until the staggering of school holidays. I've tried to find out if the holiday airlines of other countries do the same but was able to get that information. The UK has always been at the forefront in exploiting it's citizens. If the school holidays timetable is like ours in other countries then I assume it's the same of the basis of supply/demand.

Have a read of this..https://iea.org.uk/why-holiday-prices-shouldnt-be-capped-during-school-breaks/

As you see, the staggering of schools holiday periods is suggested as the only way to stop this practice. By the way, A 319,000-name petition to parliament was raised in 2019 about it and was rejected. on the grounds that pricing is a matter for the holiday companies.

In the article I thought this was silly statement. "However, flights and hotels are generally much more expensive outside term times. This had led to accusations that travel firms are ‘exploiting’ responsible law-abiding families. Put that way, it sounds like it's ok to charge extra to the families of the irresponsible and criminals..Some may think that quite a good idea

 

[cambsno]

The pricing of holidays in school holidays is simply supply and demand like many businesses. The issue with you not being able to take kids out in term time so many families will miss out on a family holiday. This is because missing a day is so bad for a Childs education - yet its ok for my daughter to miss school this Weds due to a teacher strike!

Anyway - I travel a lot and the extras IMO tend to be the same price. I certainly don't notice much different over these over the years. Have no problem with the extras either (unlike many who moan on a Ryanair FB group I am on). If they didn't charge extra to sit together, take a bigger bag etc... then the ticket price would be more.

 

[LCPete]

Not sure about algorithms but Easy Jet is upfront with any extras and if you book Essentials it is very clear what baggage is included and that’s what we always do. it’s not difficult

Essentials​

• One small under seat cabin bag (max 45 x 36 x 20 cm)
• 23kg hold bag
• Standard seat

Yes I’ve booked with Easy jet and went for essentials it’s still quite cheap
I went for under seat bag and hold bag

 

[JonathanRyan]

do you think they would actually Email these potential income sources ? If they don't I wonder why they use algorithms ?

I've not booked a flight in a long time and I certainly don't know what their booking systems actually do, but I know some of what is possible so they could be doing some or all of the following....

1. As you say, after the fact emails to people offering upgrades they think they will buy
2. Manipulating the price of options in real time - the article mentions that the cost for checked luggage varies wildly. It's certainly possible to present one price to people who will buy it anyway and a lower price to people who might not.
3. Packaging options for people to bundle stuff they want with stuff they don't. Again these can be custom built in real time. Oh, you like to book that seat? Great, but unfortunately for that you need to book speedy boarding and extra legroom.
4. Manipulating the page so that options you will buy can be found but options you can be tempted to buy are very visible. Supermarkets do this all the time (though not ad hoc). The stuff they want you to buy is eye/hand level - the stuff you will seek out is somewhere near your knees.
5. When seats are scarce, making it easier for big spenders to book. Your cart will expire after a period of time so somebody else can buy the seat - but who knows how long? Maybe longer if you have loads of options in there.

They have also been fiddling with baggage size. Size A used to be carry on and size B checked so frequent fliers bought luggage that exactly matched these sizes. Then they can drop size A by an inch or 2 - all of a sudden you either have to buy new luggage or check your bag.

Not *all* of this is evil - people flying in winter will have heavier clothes, shoes etc leaving less spare capacity on planes for luggage. Which of course makes luggage expensive. In summer when people travel in shorts they can carry more luggage for the same fuel. Air Samoa famously started weighting people and charging them according to weight 10 years ago

Pay by the Pound: Samoa Air Becomes First Airline to Charge Overweight Passengers More

Airline charges passengers for what they weigh, plus baggage.

www.ibtimes.co.uk

Algorithms and customer profiling like this are everywhere. Oh, you expect to pay £3.80 for a sandwich? Well we just made it £4.50 - but you can get that, a £1.20 bag of crisps AND a drink all for a fiver. Bargain. Except you spent £1.20 more.

As the volume of data firms have on you explodes, expect to see far more of this in the future. Or not - a lot of it is hidden

 

[JohnC6]

I've not booked a flight in a long time and I certainly don't know what their booking systems actually do, but I know some of what is possible so they could be doing some or all of the following....

1. As you say, after the fact emails to people offering upgrades they think they will buy
2. Manipulating the price of options in real time - the article mentions that the cost for checked luggage varies wildly. It's certainly possible to present one price to people who will buy it anyway and a lower price to people who might not.
3. Packaging options for people to bundle stuff they want with stuff they don't. Again these can be custom built in real time. Oh, you like to book that seat? Great, but unfortunately for that you need to book speedy boarding and extra legroom.
4. Manipulating the page so that options you will buy can be found but options you can be tempted to buy are very visible. Supermarkets do this all the time (though not ad hoc). The stuff they want you to buy is eye/hand level - the stuff you will seek out is somewhere near your knees.
5. When seats are scarce, making it easier for big spenders to book. Your cart will expire after a period of time so somebody else can buy the seat - but who knows how long? Maybe longer if you have loads of options in there.

They have also been fiddling with baggage size. Size A used to be carry on and size B checked so frequent fliers bought luggage that exactly matched these sizes. Then they can drop size A by an inch or 2 - all of a sudden you either have to buy new luggage or check your bag.

Not *all* of this is evil - people flying in winter will have heavier clothes, shoes etc leaving less spare capacity on planes for luggage. Which of course makes luggage expensive. In summer when people travel in shorts they can carry more luggage for the same fuel. Air Samoa famously started weighting people and charging them according to weight 10 years ago

Pay by the Pound: Samoa Air Becomes First Airline to Charge Overweight Passengers More

Airline charges passengers for what they weigh, plus baggage.

www.ibtimes.co.uk

Algorithms and customer profiling like this are everywhere. Oh, you expect to pay £3.80 for a sandwich? Well we just made it £4.50 - but you can get that, a £1.20 bag of crisps AND a drink all for a fiver. Bargain. Except you spent £1.20 more.

As the volume of data firms have on you explodes, expect to see far more of this in the future. Or not - a lot of it is hidden

Many thanks..much appreciated. That's a really comprehensive reply and covers all my queries.

Samoa Air...Lol. As soon as I read that I thought of the rugby team..giants to a man...almost. Then I scrolled down and saw a photo of the Samoan team on a pitch. Two giants in the Samoan team are James Johnson and he's one of only a few rugby players weighing in at over 308 lbs [140Kgs] .6'.8" and his team mate, Alo-Emile weighs in at 284lbs [129kgs.] 6'6".