Pricing strategy

[Grimvisage]

I'm trying to figure out the best way to adjust prices on routes as they grow, but I can't seem to hit it just right. It's difficult to pick up on overall changes in LF% unless they're very large and visible in the bar graphs. The little arrows are turning red and green seemingly randomly. And once a route gets to 100 RI, should I assume that means I can put default prices on it? Or can I raise it further? Apart from cutting prices when opening a route, are there any guidelines with pricing, or is it just trial and error all the way?

[antillesatlantique]

I totally second that question..

[cidjackaries]

On your comment on the little arrows turning red and green, under the manage routes screen you can click on a route and then look at the history of each flight, it also lists any delays with the flight. Constant delays in the flight will reduce the route image, and it will decrease the amount of people who want to fly on the route. For example, I have a 727 with two flights per day on it, the turn around time is a killer, as such there is always a delay on take off on the second flight of the day, so I reduced the cost of that leg so pax will still fly on it, and jack up the cost on the return flight to make up for the loss.

I am testing the 100 RI and the effects of pricing on it. One of my routes that is at 100 RI, I have increased the prices by 5% above default and have not seen a drop in PAX. It would be a different story if another airline was flying the same route.

[d2031k]

I'm trying to figure out the best way to adjust prices on routes as they grow, but I can't seem to hit it just right. It's difficult to pick up on overall changes in LF% unless they're very large and visible in the bar graphs. The little arrows are turning red and green seemingly randomly. And once a route gets to 100 RI, should I assume that means I can put default prices on it? Or can I raise it further? Apart from cutting prices when opening a route, are there any guidelines with pricing, or is it just trial and error all the way?

As you say, chopping prices when you open a route is the first guideline, between 20-30% is usually best I've found.

Once routes reach 100 RI, the default price changes depending on your CI and the fuel price.  As fuel prices rise, try and match the rises with your ticket prices.  If you have a high CI (say over 70) you can charge a little more than the default as pax will want to fly your airline, but as mentioned above, if competition opens up you lose pax quickly.

The LF graphs tend to operate in what appears to be a somewhat random fashion, up one week, down the next, but as long as they grow as your CI goes up and then remain steady once your established, you won't need to focus too much on them.  The number of variables is so high it becomes impossible to follow.

Try also slashing your business fares on routes with low business demand.  Gaining the first and business market is key to the big profits - always try and offer business class seats unless the aircraft is too small.

Hope that helps.

Dave