Bidding for bumps

Love it or hate it, overbooking of flights is a staple of the airline revenue management scheme.  And when the airline bets wrong and has too many folks for their flight, someone isn’t going to actually fly on their preferred flight.  If there are no volunteers the rules for compensation are actually pretty clear, as they are defined by the federal government (and recently the values all increased).

But when the airline goes looking for volunteers the rules are rather flexible.  The airline can offer anything they want, and if they get a taker, that’s what the price is.  For some folks it might be a meal voucher and an upgrade on the next flight out.  For others, a “free” ticket.  Still others go for a travel voucher as their preferred compensation (this is the only one I’ll take, for many reasons).  Northwest has recently taken the bump compensation process to another level, soliciting bids from passengers for how much it would take for them to not fly.  Passengers are reporting that they are being prompted during the check-in process if they are interested in a bump and how much it would cost for them to fly at a later time.  And instead of going with the first volunteers the airline can go with the cheapest option.  The reverse auction style approach is likely to save the carrier a few dollars over time, and every little bit helps these days.  It also means that it’ll be harder to fund travel habits with the “bump” game.

As an aside, my best sequence of bumps was one ticket that got me to Alaska, Ireland and half-way to India on a sequence of consecutive bumps.  Very nice for us.

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Seth Miller

I'm Seth, also known as the Wandering Aramean. I was bit by the travel bug 30 years ago and there's no sign of a cure. I fly ~200,000 miles annually; these are my stories. You can connect with me on Twitter, Facebook, and LinkedIn.