How Delta Masters the Game of Overbooking Flights

by Adam

Delta began their kiosk bidding practice back in 2011, it’s a process that asks passengers during check-in how much they are willing to accept for taking a later flight. Of course, the kiosk clearly states  “Delta accepts lower bids first.” PBS NewsHour took an interesting look at the process to see how Delta ensures that it just about always locks in the lowest possible payout. Two interesting quotes from the article below, but check out the full read here.

For the past several years, Delta has largely outperformed its major competitors, United and American, in bumping far fewer passengers involuntarily while routinely getting more passengers to voluntarily fly standby. In 2014, about 96 of every 100,000 Delta fliers had to take a later flight because the plane was overbooked. This compared to 95 at United and 50 at American. But only three of every 100,000 Delta passengers were bumped involuntarily. United had to bump 11 and American, five. Multiplied out, Delta was able to get thousands more of its passengers to agree to stay behind and involuntarily stranded thousands less.

And this bidding practice does save Delta a lot of money, but not principally in the way you might expect. Anthony Black, a spokesperson for Delta, told me whatever the airline is saving on the cost of travel vouchers is insignificant compared to what they’re saving in time. By ranking fliers willing to give up their seats even before they get to the gate, Delta eliminates the last-minute negotiations that distract gate attendants and delay flights, which inconvenience everyone onboard. “When you consider all the things that are going on at the gate, anything you can do to reduce the need to engage an agent when they’re trying to dispatch the flight goes a long way in making sure they can get the aircraft out on time,” Black said.

Delta Bump

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DaninMCI January 7, 2016 - 11:53 am

I understand why they do it and I know a ton of people will argue with me but….I think it should be illegal to sell something you don’t have. It would be like buying a ticket at the movie theater box office and when you get to the door they tell you that it’s oversold and you’ll have to wait until the next showing in a couple hours unless you want to see another movie.

How Many Airlines Does Delta Really Run? Try Five - Point Me to the Plane January 8, 2016 - 4:38 pm

[…] Related – How Delta Masters the Game of Overbooking Flights […]

rahul October 4, 2020 - 10:38 pm

1)What are three advantages to Delta itself of using this pricing approach?
2)What are three benefits to the customer of this approach?
3)What are four competitive advantages Delta might gain from this approach? You must explain how a particular item helps the Delta against competitors. For example, what’s the potential opportunity to gain market share from competitors if Delta’s costs are lower than others.

these are my questions


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