Conventional wisdom that Tuesdays and Wednesdays are the best times to shop for U.S. airline tickets may be misguided, according to researchers at Texas...

Conventional wisdom about the best times to shop for U.S. airline tickets may be misguided, according to researchers at Texas A&M University.

“There’s been this industry folk wisdom that says Tuesdays and Wednesdays are the best days to purchase airline tickets,” says Steven Puller, an associate professor of economics at Texas A&M University who specializes in industrial organization. “But we couldn’t find any systematic analysis to back that up.”


Instead, says Puller, the weekend is the best time to book airline tickets because airlines are more likely to offer fare discounts on Saturdays and Sundays.

The first Southwest Airlines aircraft ever to operate to Atlanta touches down on February 12, 2012 at Hartsfield-Jackson Atlanta International Airport

The first Southwest Airlines aircraft ever to operate to Atlanta touches down on February 12, 2012 at Hartsfield-Jackson Atlanta International Airport

 

In the study ‘Price Discrimination By Day-Of-Week Of Purchase: Evidence From The U.S. Airline Industry’, published in the Journal of Economic Behavior & Organization, Puller and co-author Lisa Taylor, a former Texas A&M graduate student, found that tickets purchased on weekends were on average 5 per cent cheaper than similar tickets purchased on weekdays.

“We find that when you control for a large set of factors – the day-of-week of travel, whether the ticket was refundable, the number of days in advance that the ticket was purchased, how full the flights were, and other factors – that tickets purchased on the weekends were sold, on average, for a 5 per cent discount,” notes Puller.

The study found that the weekend-purchase discount was greatest on routes with a mix of both business and leisure customers. Leisure destinations such as Orlando or Las Vegas do not see much of this type of discounting, according to Puller.

Without making a definite conclusion, the researchers suggest that this weekend-purchase effect reflects a common airline practice known as “price discrimination”.

Price discrimination occurs when the same service is sold at different prices to different buyers: in this case, the prices is based on the day of the week that an airline ticket is purchased, as the airline tries to play the odds when deciding how to price flights.

“Take a route that serves both business and leisure travelers,” says Puller. “If the business travelers primarily purchase tickets on weekdays, then the typical traveler buying on the weekend is more likely to be a price-sensitive leisure traveler than a business traveler. There is an incentive for the airlines to lower fares on the weekends to try to entice the price-sensitive leisure traveler to buy a ticket.”

A Southwest Airlines Boeing 737-700 taxis at Hartsfield-Jackson Atlanta International Airport

A Southwest Airlines Boeing 737-700 taxis at Hartsfield-Jackson Atlanta International Airport

 

But do airlines know if any particular buyer is traveling for leisure or business? “They don’t,” Puller reckons. “They’re playing the odds.”

The researchers looked at a historical archive of tickets purchased on all major U.S. airlines. Puller says the study compared tickets with similar characteristics, rather than simply looking at the cheapest fare available.

“If you’re a traveler who just wants to get from point A to point B for the cheapest price possible, then these findings may not apply to you,” says Puller. “But many people do care about these factors.”

The researchers only studied round-trip flights offering non-stop service. The study did not examine first-class airfares or the holiday travel periods around Thanksgiving, Christmas and New Year’s Day.

Puller says the study’s results also could have implications for other industries which have the ability to change prices daily based on the types of customers who purchase on a specific day.

“The software systems that are used in airline pricing are used in other industries such as cruises, hotels, car rentals,” notes Puller. “We’ve only analyzed airline pricing, but I wouldn’t be surprised if similar pricing practices are used in these other industries as well.”

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  • David

    December 30, 2013 #1 Author

    Buying a flight ticket on a weekend is quite a tough kind of task because sometimes we have to pay higher rates for the tickets.

    Reply

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