Air Fares: Price vs. Value

By Robert Mark on December 8th, 2008

Everywhere today, talk about airline travel is pretty much the same. Flying is a commodity, so it makes good sense to search for the cheapest price, a variable that normally overrides the few other filters consumers can use, like the number of enroute stops or the time of day. Deep down inside though, what consumers really want is a good deal, something that can be pretty tough when there is little information to help with the decision process.

There is some information out there however. The U.S. DOT makes a public database available of airline arrival and departure times which airlines use to generate those figures of 68 percent or 79 percent on time often languishing in the margins on Orbitz or Travelocity. Problem is, an aircraft that departs the gate within 15 minutes of its scheduled departure time is still considered on time, with no allowance for how long it might actually take the aircraft to depart for the destination. There are only so many insights to be pulled from government data.

IAGAddison Schonland doesn’t buy that theory believing there is much more  . A self-confessed data geek currently at work on his Ph.D. in Airport Satisfaction, Schonland believes there is significantly more value hiding in those government databases (BTW, You might also know Schonland as the host of the IAG podcast series).

A Business Problem with a Simple Solutionbutler

Imagine for a moment that you’re faced with the airline travel buying decisions for your company. You know the boss wants you to save money and time lost sitting around in airline terminals is valuable, unproductive time that has been typically unquantifiable. Schonland’s company, Airport Butler.com, along with Abbott Analytics – offer a solution to that data void that gets in the way of good value-based, airline ticket purchases.

Consider a departure from New York’s JFK, an airport notorious for delays.

A quick scan of the available DOT data would make a buyer think there is almost no difference between the on-time performance of JetBlue and Delta since they are only a few points apart. Yet when the Airport Butler works its datamining magic on the DOT numbers, we find that on some flights, Delta is much more chronically late than JetBlue. In fact, the sample report will show that JetBlue runs three times as much traffic as Delta and beats the pants off of them because Delta spends considerably more time on the trip from the gate to takeoff than does JetBlue. Continental takes 15 minutes less to get into the air when it leaves the gate at JFK versus American. Why? These are questions the airlines will soon be answering for consumers when these reports begin to make their way around the nation.

The Airport Butler report will also – upon request – offer a prioritized listing of delays by city pair so that the report purchaser would know that American may be cheaper in total dollars per seat between two cities, but might not be in net dollars because it is so chronically late departing vs. United or US Airways. If I were Travelocity or Orbitz, I’d want to see a feed to this data right there with everything else.

Like many other entrepreneur’s, Schonland’s solution was borne of frustration with the current system. “We have come to think that airline travel is special,” he said. “And it’s not. The airline doesn’t treat our money differently. So how come they treat passengers as if their time has no value? Try and get a refund from an airline if they cancel a flight. We built Airport Butler to get people thinking differently about airline flying. It’s time they started making the buying decision on more than simply price.”

Schonland mentioned that Airport Butler reports can also demonstrate the investments some airlines have made in technology – like Heads Up Display at Southwest, Virgin America and Alaska for example – that allow them into and out of airports when other carriers must divert. That information was not easy to find before.

“With this level of information, I can now evaluate the chances of me getting 100 percent of the value of my travel dollars,” Schonland added. And at $4.99 per report with data going back as much as a year, I can’t imagine why anyone wouldn’t want to try this before they buy their next ticket. I’d consider Airport Butler as the first in an arsenal of new-age guerrilla marketing tactics for airline passengers.

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3 Responses to “Air Fares: Price vs. Value”

  1. Dale Kettring Says:

    Cool!

    If nothing else, maybe it will debunk what the Feds/Airlines are claiming about on-time issues.

  2. Shashank Nigam Says:

    This is a brilliant initiative by Addison. The internet has allowed greater transparency into such details like on-time performance and other qualitative aspects of travel, other than just the price. And in the future, I see a number of flyer decisions being based on information like this.

    Good future!

  3. Hello AirportButler | Innovation Analysis Group Says:

    […] We are pleased that the launch has already attracted some attention. Take a look at Chris Elliott's take and Rob Mark's take. […]

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