What Can Airlines Learn From Amazon, Google and Uber About Dynamic Pricing?

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Amazon, Google, and Uber. What do these companies have in common? And more importantly, what can your airline learn from them?

The airline industry is vastly different from the sharing economy platforms and online retailers of the world, but there’s a lot to be learned from these players about effective pricing strategies. In fact, the majority of the leading digital companies out there use dynamic pricing as a solution when supply is scarce.

While Amazon, Google, and Uber all use vastly different business approaches to dynamic pricing, there are a few key takeaways the airline industry can apply to its own business:

Dynamic pricing isn’t a race to the bottom: Airlines should understand that a pricing strategy doesn’t necessarily mean competing to offer major discounts, promotions or the lowest fare.

A pricing strategy means being methodical about who an airline wants to be: Airlines need to avoid getting caught up in trying to be everything to everyone while competing head-to-head with every airline out there. An airline should clearly understand the customers it wants to serve and work to win and retain those customers.

Airlines need to make innovative technology a priority: Airlines need new pricing tools that combine innovative technology with revamped pricing processes and practices. The ideal scenario is to select tools that work collectively to solve the industry’s most critical and challenging pricing problems with a combined approach that includes both strategic and tactical pricing. That’s something the industry doesn’t have today. However, it’s well within reach.

Click here to learn more about how airlines should approach pricing optimization.

This content was created collaboratively by Sabre Airline Solutions and Skift’s branded content studio, SkiftX.