How Should Airlines Handle Overbooked Flights?

    

The airline industry has been shaken up recently by viral news stories and videos of negative travel experiences leading to bad PR for the airline industry. In particular much fuss has been made about overbooking flights.

The practice isn’t only used by airlines to keep their planes full, and their fares low, but also used regularly by hotels. Travelers fail to turn up for their scheduled bookings for many reasons, and overbooking allows airlines and hotels to ensure fewer seats and rooms go unfilled. With some airlines claiming operating profit margins as low as 1%, the practice helps to minimize empty seats and maximize profits without raising ticket prices.   

How Do Airlines Choose Which Flights To Overbook?

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Airlines use statistical analysis of historical data to determine overbooking numbers, while also incorporating real-time events like concerts, sports events, and holidays into calculations.

Regular weekdays see a slight uptake in missed or cancelled flights, and as such see higher rates of overbooking by the airlines.

While research, statistical analysis, and history provide reliable indicators, it is not a perfect system and forced bumpings and unhappy customers still result. It’s important for airlines to combine overbooking with passenger-friendly practices and methods that hold both the airline and customer accountable.

The problem arises, for both passengers and airlines - when more people arrive for their scheduled (and paid) flight than there are seats on the plane. Though it is legal for airlines to overbook their flights to operate more efficiently, they are required to abide by FAA regulations that protect passenger rights.

Furthermore, as tensions can - and often do - run high when this happens, good PR practices and professional staff are extremely important. This is especially true in the modern era of ubiquitous video recording equipment.

Standard Industry Procedures

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By the letter of the passenger-airline contract, entered upon purchasing a ticket, passengers are not in fact entitled to a particular seat, on a particular plane. Instead, they are paying for the transportation from their origin to their destination. This means they can be legally moved from their seat or flight to another day or time. The airline’s legal obligation is merely to provide transportation from the origin to the destination.

Standard airline procedure in an overbooking instance includes asking for volunteers to be bumped from the flight to a later one, and compensation with travel vouchers. If the later flight is the following day the airline must also pay for overnight accommodation.

Gate employees often gradually increase the amount offered, and can eventually enforce the revocation of the ticketed seat on that flight if there are no volunteers. When passengers are involuntarily bumped from their flight the airline is required to explain next steps, and the passenger’s corresponding rights - in writing.

How Can Airlines Better Handle Flight Bookings?

Encourage Early Check Ins

Check-in information should be collected from passengers earlier by using technology and convenient online check-in prior to arrival.

Encouraging passengers to check in early assists the airline in planning their seat allocation, as well as providing earlier warning for potential overbooking. This earlier warning has benefits for passengers as well, because it gives them advanced notice if they are in a position to be forcibly removed from their chosen flight.  

Not only does early check-in and early warning benefit both airlines and consumers, it also provides more data for airlines to analyse for upcoming flights. Data is vital for airlines when it comes to precarious situations where consumer happiness is on the line.

Be Prepared For A Potential Public Relations Fallout

Passengers are almost universally unhappy with overbooking, though statistically the chances of forced removal from a flight are in the single digits. The public outcry from negative handling, and the subsequent public relations disasters for airlines, are often much worse than large financial compensation for inconvenienced passengers. It is easier to make a few passengers happier in their worst-case scenario than to face a social-media backlash over poor handling of a situation.

Additional Training For Staff On How To Follow Operating Procedures

A well-trained frontline staff will help to minimize the potential fallout from unhappy customers. Airlines should run additional training exercises with employees that cover a variety of situations. 

What Does The Future Of Overbooking Look Like?

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It is unlikely that negative experiences or press surrounding overbooking will result in a general downward trend of air travel. Specific airlines will, and have seen, declines in sales due to bad PR, but this results in customers choosing alternate airlines as opposed to changing transport methods or foregoing travel entirely.

Today’s globalised world requires air travel, especially as markets open and develop and travel desires become broader. It is up to airlines, as responsible businesses, to remain competitive within the travel market.

For more information and resources on rights and policies, review the European Union guidelines or the American Department of Transportation guidelines.

JSF Travel & Tourism School, 05 June 2017

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