Finding the best prices for flights

Hey folks, there have been a couple Find Me A Bargain threads on how to find the best pricing for flights which I have responded to but I thought I would also write a bit of a post about how airline pricing actually works so that you can use that information to then get yourselves the best deals possible for you and your family. Once you know the ins and outs its actually pretty easy to figure out when the sales will be coming (roughly speaking).

There are some very simple ways to ensure that your family gets away for a holiday for as little as possible.

How do I know all this? I was a holidays reservation agent with Jetstar for about 18 months and am also a fully qualified travel agent, although I left the industry. Some small details might have changed but most of it is still valid and has been operating the same way for many years. If anyone has any corrections to make, please don't hesitate to make a comment and I'll edit as necessary (if I can). Most of this information applies directly to Jetstar as it stood about 2 years ago and I am highly certain that it hasn't changed. It's enough to arm you with some information though.

So, first of all you need to know how prices are actually determined by the airline, in a general sense. Here's how it works, in a rough timeline:

• Flights are first created and entered into the system by the airline approx. 320 days prior to the flight (this number varies but it's close enough for the sake of this little tutorial).
• Each flight is divided up into a number of 'classes' or 'fare levels'. This has little to do with the designations of 'Economy' or 'Business' classes, it's an internal classification that is denoted with a letter (H Class etc.)
• Each fare level is assigned a price and for the most part this never actually changes. The price change you see in terms of the price increasing is the effect of the various fare levels gradually selling out and moving towards the maximum fare (typically a fully flexible fare).
• They have a lot of eggheads who very very accurately can predict the demand for each particular flight, given normal conditions and circumstances in the world, and this is how the prices are set. X Airlines needs to make $X from a flight. That profit figure is then divided down through the fare levels so that they can offer discounted flights etc. while still maintaining profitability. Essentially, the very expensive fully flexible fares subsidise the $9 fares.
• If the eggheads get it wrong or something happens to affect demand, a sale is had to bring the demand back into line with predictions. Often sales are actually worked into the pricing of the flight as well.
• A sale fare will be calculated on a particular class of fare (H class for instance) and when that class is sold out, then you can't get the sale price anymore.

One big question at this stage is this: So if I am looking at booking for me and three mates and a friend of mine is looking at the same time for a single ticket on the same flight, how come mine the four tickets cost more (for each one) than the single traveller?

The answer to this has to do with the fare classes as I have described them as above. Say that G class is the cheapest on a flight at $50 per seat. The next cheapest seat is say H class at $60 per seat and the next cheapest one after that is I class at $100 per seat.

Now, following this example further, let's say that the remaining seats in each fare class are as follows:

G Class - 2 seats
H Class - 1 seat
I Class - 10 seats

So if you are looking for yourself and three mates (four passengers on one booking) the system will offer you the cheapest fare level it can get WHERE THERE IS ROOM FOR ALL PASSENGERS ON THE BOOKING. So even if all the seats as above are available at the time you both wanted to make your bookings, the only fare class that has room for the four passenger booking is I Class, so the total booking would cost $400 because it doesn't assign different fare levels within a booking. Your mate who just wants to book himself on his own gets there for $50.

This is how they make money, during the school holidays, people are booking in groups usually and thus their fare levels tend to be higher and the airline makes more money. The computer systems don't have the ability to have different prices in the same booking and honestly, they have very little incentive to get that changed.

So, here are the tips for getting where you want to go for as little as possible, in no particular order:

• I know it's not always possible but sit down with your partner or whole family and actually figure out where you want to go each school holidays at least 12 months in advance. This isn't always possible but if you manage to do it, even once in a while, it means that any time there is actually a sale on for the destination you have chosen, for the times you want to go, you can put down the credit card right away and get it sorted for the sale price (or close to it).
• Second, don't just keep on waiting for a sale. If a sale hasn't come up by about 4 months before the dates you want to go, just book em in at the best price you can at that point. It's not 100% that a sale won't come up after this but it's highly unlikely and fares will just continue to climb as more people make last minute plans. Remember, the people who didn't plan ahead are financing your flights if you did plan ahead. That's how it works.
• IF POSSIBLE, try and see if they will package a hotel together for you. Sometimes it's not beneficial to do so but sometimes as well the sales agents are aware of a deal that a hotel is offering which might not be specifically advertised for a while. Often hotels will offer the airline an increased commission for a certain date range of bookings, to keep their rooms full and this in turn in passed on to sales agents as an incentive to get it booked. Do your research on their suggestions and ask them if it's actually cheaper as a package or if they are just able to bundle it together for convenience. The convenience of paying once and having everything organised is often worth the price of no additional discount to a lot of travellers but if you are looking to squeeze every last dollar of value out of your trip (which is the way to go if you ask me) it might be worthwhile booking it all on your own.

The final piece of advice I can give you is this. The airline owes you nothing more than you have paid for. If you buy a $9 fare to somewhere then there will be no wiggle room in the terms and conditions (short of serious illness or a death in the family or some such, god forbid). Read your terms and conditions. If they say to get to the airport at least two hours ahead of time, just do it. It's better to twiddle your thumbs for half an hour or so than to arrive 5 mins late and have them not let you on the flight and with the discount airlines they WILL NOT LET YOU ON. No matter how you plead, threaten, cajole or yell. It's how it works. You get a lot more out of them if you drop the act of being entitled to things. This is not a jab at all you Ozbargainers but for the most part, the less folks pay for flights the more they think they are entitled to. Don't be one of these people and you might get lucky. It's the only way.

I hope this has been helpful and I am more than happy to answer questions about what I have written or if you have other questions, I can always ask my friends who still work there for an unofficial opinion.

Cheers :-)