The Life of a Fare: From Strategy to Booking

A fare is born in strategy meetings, shaped by systems, and tested in the real world of bookings.

Introduction

Airfares seem simple—just numbers on a website. But behind every displayed price lies a journey through strategy, systems, and market forces. A fare's life begins long before a traveler ever sees it, and ends only once it's sold (or not).

This article traces the full journey: from the moment a fare is created by a pricing team, through its management by Revenue Management (RM), its distribution via ATPCO and GDS, and finally to its appearance in booking channels—whether it sells or gets pulled.

Step 1: Strategic Pricing Decisions

It all starts with commercial strategy. The pricing team asks questions like:

• What markets are we competing in?
• What customer segments are we targeting?
• What’s our positioning—low fare, premium, flexible?
• How do we align with our brand, load factors, and revenue goals?

Based on this, the team decides on fare amounts, conditions (fare rules), and structures across booking classes. They define a fare ladder—from low, restrictive fares to high, flexible ones.

Step 2: Fare Construction and Rule Definition

The pricing team (or a filing analyst) constructs fare records using:

• Base fare amounts
• Fare basis codes (e.g., Y26NR)
• Routing and cabin class
• Rule categories (advance purchase, min stay, refundability, etc.)
• Taxation and surcharges

These fares are then filed through ATPCO, which acts as the global hub for fare data used by travel sellers, GDSs, and airline systems.

Step 3: Revenue Management Availability Control

While pricing defines what fares exist, Revenue Management controls how many seats are available at each fare.

Based on demand forecasts and booking patterns, the RM system:

• Opens or closes fare classes (e.g., "K" class may sell 30 seats, then close)
• Adjusts availability as booking trends evolve
• Factors in overbooking logic to optimize load

This dynamic control ensures that lower fares are sold early to fill seats, while preserving higher fares for last-minute travelers willing to pay more.

Step 4: Fare Distribution to Sales Channels

Once fares are filed and controlled, they are distributed to:

• GDSs (Sabre, Amadeus, Travelport)
• OTAs (Expedia, Booking.com)
• Meta search engines (Google Flights, Skyscanner)
• Direct airline websites and mobile apps
• Corporate and agency portals

Each channel uses the data from ATPCO and availability from the airline’s reservation system to display live fares to travelers.

Step 5: Market Monitoring and Competitive Reactions

After fares go live, the work isn’t over. Pricing and RM teams monitor:

• Competitor fare changes
• Sales performance by market and class
• Booking curve alignment with forecast
• Unintended booking behavior (e.g., overperformance of a low fare)

Tools like PriceEye are critical here—they alert teams to pricing shifts, anomalies, and rule mismatches in real time.

Step 6: Fare Adjustment or Withdrawal

Based on market performance, fares may be:

• Adjusted (fare amount or rules)
• Suppressed (temporarily made unavailable)
• Replaced (e.g., lower fare with more restrictions)
• Withdrawn entirely (e.g., when inventory fills)

Some fares live for weeks; others may be withdrawn within a day if the market moves quickly. Strategic response time is key to staying competitive and maximizing yield.

Step 7: Booking and Fulfillment

Once a traveler books the fare, it becomes part of a confirmed itinerary. At this point:

• The fare is locked in and ticketed
• Fare rules determine what changes or refunds are allowed
• The booking affects demand forecasts and RM availability for the flight

The cycle continues—each booking feeds data back into future pricing, forecasting, and strategic planning.

Real Example: A Fare’s Life on a JFK–LAX Route

1. Pricing team files a $179 fare in “T” class with 21-day advance purchase and no refundability
2. RM opens 50 seats at this fare class, then closes it once 45 are booked
3. Competitor drops a fare to $159 with more restrictions
4. PriceEye flags the change → Pricing team files a new $169 fare with 28-day advance rule
5. RM reopens seats in the new “V” class to match timing and demand
6. Bookings pick up → System adjusts forecasts and closes cheaper class earlier than planned

This all happens within days—or sometimes hours.

Conclusion

A fare’s journey is more than a spreadsheet value. It’s a living strategy shaped by pricing teams, governed by RM systems, monitored by tools like PriceEye, and judged by real-world sales performance.

Understanding the life cycle of a fare gives you the full picture—where Pricing, RM, tech, and the customer all connect. From the boardroom to the booking engine, every decision matters.

Next, we can go deeper into any part of the process—want to explore branded fares, anomalies, or RM optimization techniques?