It’s been years since I booked an overseas trip, but when I was booking flights for a family holiday recently I noticed the prices of flights kept changing – within the same day – from when I first searched for a specific route to when I went to share it with my partner. Is it legal for flight operators to change their prices based on my search history? What can I do to avoid it?
– Carolina, New South Wales
Kat George says: When you’re shopping online, it’s common to see prices – for the exact same product or service – change by second, minute, hour and day. This is known euphemistically as “dynamic pricing”, but more accurately it is “price discrimination”, a symptom of companies having access to your search data and employing sophisticated algorithms to use it against you by charging as much as they think you’d be willing to pay.
This is incredibly common with air fares, and the more you search, the worse it gets. For instance, if you’re searching for flights with set dates and locations, airlines will use that information to inflate the prices they present you. The more you search for those dates and that location, the higher your perceived desire for those flights becomes, increasing the price the service provider seeks to charge you.
Unfortunately, it’s absolutely legal in Australia. The good news is that might be set to change.
Currently, under Australian consumer law, retailers can change prices to reflect demand and supply in the market. When it comes to things like flights, supply and demand can change regularly due to external factors, such as peak travel times like school holidays, seasonal fluctuations and major sporting and music events. Because of this, dynamic pricing isn’t illegal if the airline is clear, not misleading, about the price you have to pay at the point of sale.
While legal, it is not necessarily the most fair practice, and the Australian government is acknowledging that. The now re-elected Labor government has committed to addressing unfair trading practices, and has said this will include cracking down on dynamic pricing.
While we wait for legislative reform – which, let’s be honest, is unlikely to happen overnight despite the commitment – there are some things you can do to avoid dynamic pricing while you’re shopping around for flights.
First, avoid leaving digital breadcrumbs in your wake. This means searching in a way that is as anonymous as possible, to stop airlines collecting data about you as you browse their sites.
Start by clearing your browser cookies – and be sure to decline or limit the collection of cookies whenever a website gives you the option. Cookies are little titbits of information that are stored in your browser whenever you’re online, then shared with websites whenever you visit them. They allow websites to personalise your experience, but also give businesses the opportunity to analyse your preferences and build a solid data profile about you. You may also notice that most sites now have pop-ups that guide you to accept all or decline some cookies, so you can also investigate and toggle your preferences on a case-by-case basis. It’s good practice to regularly clear your cookies regardless.
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You can also switch your browser to private or incognito mode, or use a search engine that blocks advertising, doesn’t collect your data and has inbuilt mechanisms for managing cookies – like Duck Duck Go.
If you’re really committed, you can get yourself a virtual private network (VPN), which will cloak your identity entirely. A VPN hides your IP address from the sites you visit, so it’s much harder for them to gather data. A VPN will cost you a few dollars, but ultimately spending even $20 on a VPN could save you more when it comes to dynamic pricing.
Finally, search broadly, and search early. If you’re constantly searching the same site, the data bank about your needs and preferences will build, giving the service provider more leverage to jack up prices. If you use multiple sites – for instance, flight aggregation sites – before heading to an airline’s website to book, you can minimise the impact of shopping around.
While it might be late in the day for you now, it always pays to search as early as you can. The closer you are to your travel dates when you search, the higher the perceived demand is likely to be. When airlines assume you’re under more pressure, they’ll think you’re willing to pay more, too.
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