Low-cost pricing strategies in leisure markets

Andrea Salanti, Paolo Malighetti and Renato Redondi

Tourism Management, 2012, vol. 33, issue 2, 249-256

Abstract: The practice of dynamic pricing typical of low-cost carriers is generally regarded as a form of price discrimination between “leisure” and “business” travellers on a single flight or route. The same may not be true across different routes because of the different incidence of business travellers. If price increases in the 15 days prior to departure are meant to discriminate business demand, leisure demand should account for earlier price variations. In the present study, we used a database containing the daily fare over the 3 months prior to each flight operated by easyJet during 2009. For each route, we defined the “leisure index” as the difference between the price rates of change during the 90 days and 15 days prior to departure. Overall, “business” routes had lower average prices per km, while “leisure” routes showed less dynamic price behaviour, with higher minimum and lower maximum prices per km.

Keywords: Low-cost carriers; Dynamic pricing; Leisure routes; Price discrimination (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (21)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0261517711000677

Related works:
Working Paper: Low-cost pricing strategies in leasure markets (2010)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:touman:v:33:y:2012:i:2:p:249-256

DOI: 10.1016/j.tourman.2011.03.003

Access Statistics for this article

Tourism Management is currently edited by Chris Ryan

More articles in Tourism Management from Elsevier
Bibliographic data for series maintained by Catherine Liu ().