By Kevin R. Betts
On a recent flight out of Detroit, I overheard an elderly couple arguing about whether or not they should have shared a suitcase. Bringing individual suitcases cost the couple $100 roundtrip, whereas sharing a suitcase would have only cost them $50. Fees for checked bags, as well as hidden costs associated with services like ticket changes, insurance, and booking flights by phone are common in the airline industry. Although base prices for flights often appear inexpensive, these prices do not reflect additional hidden fees that are usually incurred. Moreover, airlines are well known among the general public for variable base rate pricing, whereby different customers are charged different prices for the same tickets.
Given these concerns, many airline passengers have developed a jaded view of the airline industry. Recent research by Heyman and Mellers (2008) suggests that this can be expected. Investigating perceptions of fair pricing, they found that consumers who learn about variable pricing often feel betrayed. Moreover, companies that use variable pricing, but are caught trying to cover their tracks, are perceived as even worse. Although the airline industry may see short term financial gains by incorporating hidden fees and variable pricing methods, these gains may be outmatched by future losses as passengers lose trust in the industry.
As consumers, should we trust the airline industry? That decision needs to be made by each potential passenger, but what we should all be careful to do is stay informed. Are you willing to pay $350 for a ticket that the person sitting next to you paid $225 for? Are you willing to pay a processing fee for booking your flight by phone instead of over the internet? As consumers, these are important questions that we must consider.
Heyman, J.E., & Mellers, B.A. (2008). Perceptions of fair pricing. In C.P. Haugtvedt, P.M. Herr, & F.R. Kardes (Eds.), Handbook of consumer psychology (pp. 683-697). New York, NY: Psychology Press.
Xie, Y. and Peng, S. (2009). How to repair customer trust after negative publicity: The roles of competence, integrity, benevolence, and forgiveness. Psychology and Marketing, 26, 572–589.