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Give Us Your Personal Data Or Pay Full Fare
ebh writes "Noted in an AP story about how fees make it difficult to compare air travel costs, is how the airline industry is moving toward tailoring offer packages (and presumably, fares) for individuals based on their personal information. Worse, 'The airline association said consumers who choose not to supply personal information would still be able to see fares and purchase tickets, though consumer advocates said those fares would probably be at the "rack rate" — the travel industry's term for full price, before any discounts.'"
We've established the nature of the relationship, we're now just haggling over the cost...
Or, principles are expensive...
How many data mining tokens er loyalty cards are in your wallet?
In Australia this has been mostly fixed legislatively under the 'component pricing' laws.
Amazon do personal pricing. They won't give you a price for some things unless you login. Then they give you a price that is the maximum they think you will pay. Other people see lower prices.
The aim of personal pricing is to milk you for more money to maximize profit, not for some kind of altruism. It's all about 'how much can this customer pay right now for that item'.
Now when companies get together to implement this, this is known as a price fixing cartel. It DOES NOT require them to have a fixed price, the mere act of agreeing to deceive customers on the price, is enough to be a crime under cartel acts. So if they're doing this because they've agreed to, then you look at price fixing cartel laws to see how to fix it.
But make no mistake, when they won't tell you the price for something, its not for your benefit.
I first noticed when I did a search for a media player, I clicked through and it refused to give me a price unless I logged in. I click the 'why we ask you to login' link and it made some kind of BS claim about customer service. I got my price.
Then I then logged out, tried to create a new account, and tried again and got that *same* price (same IP, I think they're smarter about covering their tracks), so I then used a works proxy with a different IP address, and created a new account and was offered a cheaper price.
They're still up to their old games, just better at hiding them.
That was only a few months ago.
Once they see the contents of your wallet... they can adjust the prices they offer to you to maximize their intake of your cash and minimize those aforementioned contents of your wallet. That's the real key to profitability with personal pricing: find out how MUCH they are willing to pay for what they want. So it's only to their benefit to know how much money you're playing with (how good your credit is, how many other expensive things you've bought before, whether you're a customer they'd like to take on or someone they want to go away).
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There is NO benefit for customers from this at all that I can see.
In Europe, the price tag you see is what you pay. It makes so much sense. I don't care what the before tax price is. Hidden fees are illegal. This includes buying airline tickets. The North American system where you see some price, then have to guess what you will have to pay is arcane, bordering fraudulent. If you go to aircanada.com, I have to click through to the last step before actually purchasing the ticket to see what the real price is. Often the final price is double what was initially quoted. If I go to lufthansa.com, the fees are already included in the price, so easy. I remember getting a mobile phone contract in Canada, where I was surprised to discover that the actual monthly price was significantly higher than what I was quoted, even though I specifically asked exactly what the final price after all fees was. I eventually switch to prepaid, because I hated the idea that the phone company can dictate what I have to pay, regardless of what I agreed to.
Airlines are (and have been, and will continue to be) giving preferential treatment to their better customers. How this is even news, I don't know - frequent flyer programs have been around for what, thirty years now? And you don't have to fly to see all the advertising about how getting the airline's affinity credit card saves you from paying for that first checked bag every time you fly with them, and so on, and so forth. Flying 25,000 miles a year with them gets you that too, plus bonus miles, plus free upgrades when available, and the perks only go up from there.
Earlier this millennium, I spent a few years as a top-tier frequent flyer on an airline that has since merged into one of the remaining behemoths. I was in my 30's at the time, and had some "work" that involved a lot of international flights. (Thanks for paying your taxes, if you live in any of the twenty-odd countries whose governments were funding it.) It was even worthwhile for me to buy a membership in their lounges. Their back-end system had a formula for determining "high-value customers," and based partly on how many years I was expected to be their customer before retiring, it decided they were going to make some bucks off me, even though I always flew on the cheapest available fares.
The airline that borged them didn't have this generous of a nature, but said "wow, look at this great data-mining system!" and adopted it, not fully understanding what they were getting. A year or so after the merger, I used some miles for a free, non-upgradable ticket to meet up with my fiancée in Paris for a weekend. I got to the hub airport for the trans-Atlantic flight to Paris, the gate agent paged me, looked me up and down (yeah, t-shirt and sandals), asked if I was in fact me, looked more than a little distressed, then dragged me off to the side away from the counter and said in hushed tones, "We're not allowed to do this - but the computer says to upgrade you!"
As far as I know, this airline's computer still thinks I am a god among men, and unless they deliberately go in and tweak the algorithms, it may think that forever. I'm... okay with this. :)
Village idiot in some extremely smart villages.
They just keep piling it on, adding reasons not to have anything to do with air travel.
Having to pay big $$$ for parking at a lot that is still a 10 minute bus ride from the terminal
Having to wait maybe 15 minutes for that bus
Having to wait maybe 15 minutes for that bus at 24 degrees or 105 degrees
Overpriced food at terminals
TSA stealing stuff from your luggage
TSA thinking they have the right to lay hands on you
TSA thinking they have the right to x-ray you (only my Dr. and dentist...)
Late planes
Late planes when you have to catch a connection
1/2 hr sprints thru big airports 'cuz your plane was late for the connection
Lost luggage
45 minutes to retrieve luggage after plane lands
Arriving 2 hrs early 'cuz of TSA
Narrow airplane seats
Fees for blankets
Fees for pillows
Fees for food
Fees for checked baggage
Fees for carry on baggage
Having to rent a car when you get there
Paying for wi-fi in the airport
Have given up flying for anyplace I can get to with my car. About the only good thing left about flying and airports is Cinnabon.