Will Israeli BidFlyer disrupt last-minute plane ticket pricing?

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Aircraft occupancy may be the Achilles’ heel for most airlines. According to the IATA, only about 80% of flights’ seats are sold, leaving a lot of (unsold) empty space and losses in revenue in the tens of millions of dollars.

Enter BidFlyer, which if it weren’t obvious already is aiming to give those airlines a chance to put those seats on clearance. It uses an auction system for excess tickets, so passengers benefit from discounts while airlines make money they wouldn’t have otherwise. And now with an infusion of $1 million from Moshe Hogeg’s Singulariteam, they are looking to grow.

Everybody wins

BidFlyer’s solution interfaces with the booking systems of a number of different airlines using Big Data to target surplus seats. The system analyzes inventory, traffic, and user behavior. Any auctions it starts will have parameters laid down by the airline, like opening bid price. Bidding is free and the highest bid wins, but the going rate for these seats starts off far lower than last-minute tickets often get sold for.

Founder Guy Kaplan came up with the idea for the platform a year ago when he was unpleasantly surprised to find that tickets he wanted to buy for Berlin the day of the flight were not only far from cheaper than the going rate, but his and his girlfriend’s roundtrips would also total €3,000 — despite the fact the flight was nearly bereft of passengers.

Kaplan, who was then VP of Kampyle, got together with his friend and seasoned entrepreneur Asaf Gendler to develop his auction idea. Now, the year-old company employs seven people in its Tel Aviv office.

BidFlyer works in conjunction with Cockpit, an affiliate program of El Al. David Maimon, El Al CEO, says that “BidFlyer’s solution is just another step forward in a new era of ‘Big Data’ technologies that will improve customer service, plus increase and streamline sales.”

“We are proud of our partnership with them and this integrated, innovative system being on El Al’s website.”

Gedalyah Reback translated and adapted the original article from Hebrew. 

2 COMMENTS

  1. Sounds like a terrible idea for airlines, as it will encourage passengers to wait for the last minute to buy cheap tickets. thereby lowering yields and disrupting cash flow.

    • BidFlyer platform isn’t a last minute solution only. The auctions are launched up to 3 month before the flight, in different times, according to the airline’s revenue management needs; Therefore passengers are not encouraged to wait for the last minute, since they aren’t assured that a flight they want will be available for them via an auction.

      Additionally, even in last minute scenarios, BidFlyer increases the airline revenues since it attracts a new segment of leisure travellers. Other travellers will not take a chance of bidding in the last minute.

      Finally, we use big data analytics to monitor and optimize auctions in real time; Making sure the results are according to the airline strategy.

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