Comments on: Does EasyJet price children with Black Scholes? http://chezverdon.wordpress.com/2007/05/22/does-easyjet-price-children-with-black-scholes/ renewable energy | the markets | technology | sustainable living | the outdoors Wed, 03 Dec 2008 23:43:23 +0000 http://wordpress.com/ hourly 1 By: Stephen Larkin http://chezverdon.wordpress.com/2007/05/22/does-easyjet-price-children-with-black-scholes/#comment-38 Stephen Larkin Thu, 19 Jul 2007 12:38:44 +0000 http://chezverdon.wordpress.com/2007/05/22/does-easyjet-price-children-with-black-scholes/#comment-38 I think it's a combination of two factors; energy hedges that they would have done expiring and newer hedges costing a lot more - effetively passing on a fuel surcharge to the consumer. Secondly the regional airlines have cut their fares to a point where it is often cheaper to fly KLM to Amsterdam, BA to Nice and Dublin so they are becoming dependent that the average consumer will just assume that they are the cheapest and pay the price on the screen. It's the eBay effect in motion again. I think it’s a combination of two factors; energy hedges that they would have done expiring and newer hedges costing a lot more – effetively passing on a fuel surcharge to the consumer. Secondly the regional airlines have cut their fares to a point where it is often cheaper to fly KLM to Amsterdam, BA to Nice and Dublin so they are becoming dependent that the average consumer will just assume that they are the cheapest and pay the price on the screen. It’s the eBay effect in motion again.

]]> By: It’s not easy being Green - EasyJet et al « How to Be the Ripple http://chezverdon.wordpress.com/2007/05/22/does-easyjet-price-children-with-black-scholes/#comment-26 It’s not easy being Green - EasyJet et al « How to Be the Ripple Tue, 03 Jul 2007 21:56:28 +0000 http://chezverdon.wordpress.com/2007/05/22/does-easyjet-price-children-with-black-scholes/#comment-26 [...] be green and eliminate the hassle for your customers. At the rate the competition is growing for bargain fare airlines, I bet the next green wannabe EasyJet will find a way to do [...] [...] be green and eliminate the hassle for your customers. At the rate the competition is growing for bargain fare airlines, I bet the next green wannabe EasyJet will find a way to do [...]

]]> By: PressPosts / User / Sonnenmensch / Submitted http://chezverdon.wordpress.com/2007/05/22/does-easyjet-price-children-with-black-scholes/#comment-20 PressPosts / User / Sonnenmensch / Submitted Sat, 02 Jun 2007 14:30:42 +0000 http://chezverdon.wordpress.com/2007/05/22/does-easyjet-price-children-with-black-scholes/#comment-20 <strong>http://pressposts.com/Technology/Does-EasyJet-price-children-with-Black-Scholes/</strong> Submited post on PressPosts.com - "Does EasyJet price children with Black Scholes?" http://pressposts.com/Technology/Does-EasyJet-price-children-with-Black-Scholes/

Submited post on PressPosts.com – “Does EasyJet price children with Black Scholes?”

]]> By: Nigel http://chezverdon.wordpress.com/2007/05/22/does-easyjet-price-children-with-black-scholes/#comment-19 Nigel Tue, 22 May 2007 15:17:49 +0000 http://chezverdon.wordpress.com/2007/05/22/does-easyjet-price-children-with-black-scholes/#comment-19 Perhaps I am being a little too harsh on EasyJet's pricing capabilities, but it is a little obvious where they have "tweeked" the model to up prices with the hope that people "do not notice". I totally agree routes and destinations being un-differentiated (except perhaps some of the obscure places you end up with with Ryan air :-) ), and it is perhaps time for one of the budget airlines to start upping the ground based customer service "capabilities" - why?...... Just part of a cycle of an industry being re-invented through price transparency (hence lower cost) and innovation through technology (hence lower cost). Next stage, differentiate via ground-based service? Not sure in-flight service is the right place to differentiate on short haul - personally I like the no frills in-flight service as you have clear expectation as to what you are getting. I have also found the EasyJet cabin staff and flight crew great fun and more "relaxed" than traditional airlines. Thankfully EasyJet and others did not have BA's endemic public servant mentality to start with... Perhaps I am being a little too harsh on EasyJet’s pricing capabilities, but it is a little obvious where they have “tweeked” the model to up prices with the hope that people “do not notice”.

I totally agree routes and destinations being un-differentiated (except perhaps some of the obscure places you end up with with Ryan air :-) ), and it is perhaps time for one of the budget airlines to start upping the ground based customer service “capabilities” – why?……

Just part of a cycle of an industry being re-invented through price transparency (hence lower cost) and innovation through technology (hence lower cost).

Next stage, differentiate via ground-based service?

Not sure in-flight service is the right place to differentiate on short haul – personally I like the no frills in-flight service as you have clear expectation as to what you are getting. I have also found the EasyJet cabin staff and flight crew great fun and more “relaxed” than traditional airlines.

Thankfully EasyJet and others did not have BA’s endemic public servant mentality to start with…

]]> By: Sean http://chezverdon.wordpress.com/2007/05/22/does-easyjet-price-children-with-black-scholes/#comment-18 Sean Tue, 22 May 2007 12:48:02 +0000 http://chezverdon.wordpress.com/2007/05/22/does-easyjet-price-children-with-black-scholes/#comment-18 I'd be surprised if EasyJet didn't have at least what they think is a sophisticated algorithmic pricing engine/model. I mean isn't that really the key element of running an airline (the planes and destinations are undifferentiated - well putting aside monopolies and oligopolies artificially created by bureaucrats and their rent-seeking supplicants. The science and art of maximizing revenues per passenger/mile is after all just a (fiendishly difficult) optimization problem. Indeed this is at the heart of the business case behind Ed Iocabucci's DayJet concept and company. I’d be surprised if EasyJet didn’t have at least what they think is a sophisticated algorithmic pricing engine/model. I mean isn’t that really the key element of running an airline (the planes and destinations are undifferentiated – well putting aside monopolies and oligopolies artificially created by bureaucrats and their rent-seeking supplicants. The science and art of maximizing revenues per passenger/mile is after all just a (fiendishly difficult) optimization problem. Indeed this is at the heart of the business case behind Ed Iocabucci’s DayJet concept and company.

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