One of the four P’s of the marketing mix is Pricing, which deals with how much a consumer is willing to pay for a product or service (supply and demand). It has an enormous effect on the consumer’s perception of the attractiveness of the product. Consumer surplus can be extracted and turned into extra revenue when businesses price discriminate (charge different prices to different consumers).
______________________________________________________________
Airlines do just that when they “get personal” with their flight prices, as this article states. How they decide who gets charged what is astonishing and it would vary from “how regularly they fly, where they live and the kind of trip they are taking.” Delta Airlines would be an example of an airline that would overcharge frequent fliers. Their defense to such biased pricing is so that they can “better tailor their services to the needs of their customers.” Even so, they know what they’re doing.
______________________________________________________________
Since it’s almost Spring Break, airlines know that the demand to just get away from it all will increase, so they’ll be willing to spend a bit more. “Airfare for spring break is up almost double digits from last year” Have no fear, however, because the article also mentions how you’ll be able to find a few bargain destinations, including Hawaii, which has dropped between 1 and 4% since last year. This just goes to show that pricing is an extremely complicated marketing mix factor. However, you can be sure that there is a reason behind every price tag.
Picture sources:
Airlines (http://www.tnooz.com/2012/10/02/news/what-do-airlines-really-know-about-using-social-media-in-2012/))