On November 15, United is moving to a model in which it dynamically prices award seats. While that may irk frequent flyers, it opens up a whole new tier of fares to budget travelers.
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Starting later this year, United Airlines is removing its published chart used for pricing award seats and adopting a dynamic model for pricing.
Depending on the type of traveler, this can be good or bad. With dynamic pricing, United can now slide the price of award seats down when demand is low — say for a flight to Europe in January or February — opening access for a whole new segment of budget or flexible travelers.
Passengers used to predictable and transparent tiers of award pricing may find less value in the new model. As an extension of United’s new flexibility, it also now has the power to ratchet award seat prices through the roof around Thanksgiving and Christmas.
Dynamic pricing will go into effect at United on November 15, just weeks before the holiday season. Until then, MileagePlus members will still use United’s tiered system with the added benefit of some dynamically lowered fares. Close-in booking fees will also be removed at that time.
Skift’s full report on the change, including insight from United’s head of MileagePlus, has the details.
— Grant Martin, Business of Loyalty Editor
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Skift Business of Loyalty Editor Grant Martin [[email protected]] curates the Skift Business of Loyalty newsletter. Skift emails the newsletter every Monday.
Photo credit: In this Saturday, Dec. 21, 2013, file photo, Holiday travelers check in at the United Airlines ticket counter at Terminal 1 in O'Hare International Airport in Chicago. Nam Y. Huh / AP Photo