Pricing Strategies: Versioning in Airplane Seating


In the last year I’ve traveled with 5 different airlines. Each airline offered some “pick your seat” functionality, and each charged extra for preferable seats. I take this as an excellent example of versioning as a pricing strategy. In this post I’ll examine the values that influence my choice, the options presented to me, and relate my decision to the cognitive biases identified in session 6.

Value 1: Price

This is the number one consideration when picking my flight. After finding the cheapest flight, I do not want to spend extra money on picking a seat.

Value 2: Legroom

I’m 198cm tall. If I sit fully upright in an airplane seat there’s barely enough room for the magazine in the seat pocket in front of me.

Versioning

I most recently booked a KLM flight AMS – NYC. This is the seat choice range I was presented with:

Economy Comfort Extra Legroom Preferred Seat Economy
€90 €70 €30 €–
27 remaining 7 remaining 24 remaining
Up to +10cm space Up to +22cm space Standard Space Standard Space
Extra Recline Standard recline Standard recline Standard recline
Front of Plane Exit Row Seat Best Economy Seat Economy Seat

Immediately I disregard “Preferred Seat”. It is more expensive and doesn’t give me extra legroom. Next I eliminate “Economy Comfort”. It is more expensive than “Extra Legroom” and doesn’t offer as much additional legroom. Now I have two choices; pay €70 for extra legroom or spend 8 hours hoping the person in front of my doesn’t recline their seat.

Cognitive Biases in Play

Relativity – Price: In comparison to the high end “Economy Comfort”, “Extra Legroom” looks like a deal! I get extra legroom and save €20!

Relativity – Space: “Extra legroom” has 22cm extra space! It doesn’t tell me how much legroom “Economy” has, or how much “Extra Legroom” has. It just tells me that one has more than the other.

Anchoring: KLM lists their most expensive option first. As I read the table from left to right my first impression is €90. My perception of the prices of the rest is first influenced by this information.

Decision

I booked an economy seat. I paid €650 for the flight, and couldn’t justify spending more than 10% of the flight cost on a more comfortable seat. In the end my first priority was on low price, and the versions offered by KLM did not justify a higher price. I really hope the person in front of me doesn’t recline…

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