Pricing vs ORS vs SLF

Hellow everyone :slight_smile:

I have a quick question about the way price changes ORS rating and how it affects SLF.

I do not really have any competition on my routes and was wondering whether increasing prices (by like 10-20%) has an effect on SLF?

I am sure it brings the ORS rating down, but if it stays above the next connection, does it affect how quickly a flight sells out and how many people want to fly?

Thanks in advance :slight_smile:

In theory it does not but in practice I have seen it to affect the demand.

Take an ultra long haul flight with C class where rating can be 100 (e.g. on a 787). I have had cases, with noncompetition on the route, that the load factor in C increased after going from 99 to 100 ORS. It makes no theoretical sense, as the closest competition was in 70s ORS, but I have seen that happening.

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It makes perfect sense as your rating increased relative to competition (noncompetition would be no alternative ORS entry)
With that increase you pull bookings from the 70s connection.

Demand is not distributed by absolut values, as in β€œthe 100 is filled up and the excess is booked on the 70”.
But I think you know that.:wink:

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Of course I know and understand, but in that specific case the bookings went up from 3-4 C to full 28 C. It was a huge increase which I would have not thought would be the case.

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Maybe these pax came from inbound flights?

What I also forgot in the beginning: While you might already have a rating of 100 for a particular non-stop route, lowering the price of a segment can still increase the rating for connection routings via your hub.

Are you certain that there are no competitions? Since the demand in game is not flexible, the additional passengers almost certainly comes from a competitor, unless they are previously unserved.
Most likely, what happened is that the additional passengers are connecting passengers that are previously not on your airline.
In order to get a better sense of the traffic, let me give some explanation on the demand distribution of this game. Based on my experiments, it seems that the traffic is distributed PROPORTIONAL TO ORS, up to a cutoff where 1 passenger is booked per flight. (Connections with lower ORS will not receive any booking, as a corollary. ) What does it mean?
Firstly, on a short route without too many connection options (e.g. less than 1000 bookable connections), then the traffic can be expected to distribute proportional to the ORS (i.e. for 100 passengers, and 2 flights with ORS of 90 and 60 respectively, then passenger is distributed at 60 to 40), and an increase in price will see the booking to drop at most proportional to ORS drop. If this airport pair is underserved, then no reduction in booking at all. Therefore, on short trunk routes, one can choose to increase price, live with less than 100 ORS and still have good SLF.
Secondly, on a long route with many connection options (e.g. LHR-HKG, 60’000 bookable connections shown up on riem, which is a reduced demand server), For direct flight, a reduction of ORS from 100 to, say 90, will decrease direct booking by about 10%. However, for connectting flights, due to the cutoff, most bookable connections will not receive any booking. Consequently, a decrease of ORS from 74 to 71 would mean the difference between receive some booking (most likely 1) to not receiving any, since most likely on long haul routes with fierce competition like this 72 could be the lowest ORS where a booking is possible, booking on long haul flights are very sensitive to changes in ORS. Therefore, a small change in price can lead to a huge different in booking for long haul flights, since this leads to a huge difference in connecting traffic if that happened to be close to the cutoff.
In this game, direct flights does not receive much traffic, especially on long haul routes. Most traffic between large airport pairs that are far apart is distributed to 1 connection flights, since 1 connection generates much more bookable combinations (i.e: 10 direct flights are 10 entries in ORS, however 10 flights departing at the same time, and stopping at the same intermediate airport gives 100 entries), while 2 connection flights will not receive any booking since their ORS is lower than the cutoff. 2 connection flights will receive booking on niche routes where 1 connection flights does not push cutoff ORS too high.

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Actually I have a similar question.

In a private gameworld, I have several domestic routes that have no other showings in the ORS (i.e. only my three flights in the next 72hrs in the ORS is shown). However, price would also affect the number of pax booked onto the flight. In theory, that should not happen, unless the demand for certain city pair would also changes in proportion to price.

Thanks for this detailed reply. It definitely answers some of my questions and gives me insight into price/slf/ors combinations :slight_smile:

Don’t forget connecting pax from other flights and don’t forget ground networks here.
Take an empty flight that has been freshly booked into the system. It should only get pax when demand is distributed at departure airport. Everything else that gets booked at other times is either from feeder, or connecting (you can see both in flight info) or comes or goes via ground networks!

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