http://www.economist.com/blogs/gulli...irline_tickets http://www.economist.com/blogs/gulli...heapestflights
Getting the cheapest flights
Feb 6th 2011, 21:21 by N.B. | WASHINGTON, DC
LAST AUGUST, Gulliver told you about the "eight-week rule" (see below) for buying airline tickets. According to Makoto Watanabe, the cheapest time to book your flight, all else being equal, is about eight weeks before you plan to leave. It's a good one-step rule. But what else should you take into account when trying to get a great deal on an expensive flight? The Wall Street Journal's Scott McCartney has some suggestions. Bottom line: if you buy your tickets midweek (i.e., Tuesday, Wednesday, or Thursday), you can save a bundle. One expert, FareCompare.com's Rick Seaney, has even pinpointed an ideal time to buy: 3 p.m. EST on Tuesday. So why do fares work this way, anyway? Here's Mr McCartney:
Though prices fluctuate frequently and the ups and downs of airline prices can frustrate and anger consumers, airline pricing actually does follow a cycle during the week. Many sales, in which some seats are discounted by 15% to 25% typically, are launched Monday night.......When airlines want to push through a fare increase, marking up their basic prices across the board usually by $5 or $10, they often do that on Thursday night, then watch to see if competitors match and if the higher rates stick over the weekend. If competitors balk, prices can be rolled back by Monday morning.In addition, airlines don't manage their inventory as actively on weekends, so if cheap seats sell on some flights, prices automatically jump higher. Fare analysts may decide later to offer more seats at cheaper prices, but not until they come back to work on Monday, according to airline pricing executives.
The upshot of all this, as Mr McCartney explains, is that the same ticket can be "$199 certain days and $499 other days, even months ahead of a flight."
Mr McCartney's article raises as many questions than it answers. Do corporate travel departments take advantage of airline pricing fluctuations and buy most of their tickets mid-week? How is the development of ever-more sophisticated fare comparison engines, such as Kayak.com, influencing pricing strategies? Much of Mr McCartney's data came from Kayak. But this definitely seems like a situation where the observer effect comes into play. Can journalists and the public extensively study airline pricing strategies without forcing airlines to respond and adjust?
Mr McCartney also warns that social media such as Facebook and Twitter are "already beginning" to "disrupt" airline pricing patterns. It will be fascinating to see how that dynamic continues to evolve. Have any readers ever bought an airline ticket through Twitter or Facebook? Would you consider doing so in the future? I follow JetBlue's Twitter account for last-minute sales, but I've never bought any of their " cheeps." Anyway, what other sorts of ways do you see the rules about how, when, and where it's best to buy airline tickets changing in the coming years? Let us know in the comments, and check out Mr McCartney's full story for the rest of his tips.
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The eight-week rule
Aug 24th 2010, 12:11 by N.B. | WASHINGTON, DC
WHEN is the best time to buy airline tickets? An economist, Makoto Watanabe, thinks he has an answer. Here's the Guardian:
[Mr Watanabe] has calculated that the optimum time to buy an airline ticket is eight weeks in advance of flying.His yet-to-be-published findings also suggests that airline tickets are cheaper when purchased in the afternoons, rather than the mornings, prompting him to speculate that airlines are assuming business travellers will book their tickets at work in the morning on the company account, whereas leisure travellers are more likely to book from home in the afternoon.The eight-week result stems from work published in the latest edition of the Economic Journal in which Watanabe and his colleague, Marc Möller, offer intimidating equations such as ∏A = gUG + min(k - g, (1 - g)(1 - r)) as part of the complex formula, where ∏ equals profit, that determines advance ticket purchases.
I can't vouch for the math, but Mr Watanabe's result seems intuitively right. It definitely jives with much of the anecdotal ticket-purchasing wisdom passed from business traveller to business traveller. But just because something is generally true doesn't mean it's always true (or will continue to be true in the future). Airline sale alerts and ticket price monitors are still useful tools.
If you don't want to spend the time setting up those kinds of alerts, and just want to have a decent shot at the cheapest ticket, Mr Watanabe's rule might be a good place to start. (Anyone have a different hard-and-fast rule for buying airline tickets? Let us know in the comments.) Please be careful about placing too much faith in these sorts of guidelines, however. No hard-and-fast rule about "the best time to buy" something can hold true for very long if it becomes widely used. If ticket buyers start sticking to the eight-week rule, it will presumably change demand for tickets at the eight-week mark. That will affect prices, and the rule won't be as useful.
Anyway, read the Guardian's whole report. It includes a comparison to Broadway show tickets and is well worth the click-through.
http://www.economist.com/blogs/gulli...irline_tickets 
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