Last week I wrote a special Friday post tearing apart the way the media misinterpreted a report showing that Sunday is the cheapest day to buy plane tickets. As annoyed as I was to see it covered so poorly, I was even more annoyed to see the most interesting data buried beneath those mindless headlines. There actually was some pretty helpful information in the report surrounding how far in advance you should book your ticket.
First, a couple caveats. We have to keep in mind that this looked at tickets issued between January 2013 and July 2014. Since it’s not a single year of data, there is some seasonality here. For example, we have two summer seasons being booked but really only one winter holiday season. Also, unlike looking at the day of week information, the difference between leisure and business doesn’t make the data worthless. Business travel tends to be booked closer to departure when the fares are higher while leisure travel is booked further out when fares are lower. Sure there’s some mixing going on here, but the data should still hold pretty well.
Let’s start with the domestic market.
The Airline Reporting Corporation (ARC) data shows that for domestic travel, booking 57 days in advance is optimal. Let’s not take this too literally though. The point is that if you book about 2 months out, you’ll get the best deal. That makes sense. The price gets higher the closer you are to departure since seats become scarce and the last minute traveler is willing to pay more. But it seems strange that if you book more than 2 months in advance, the price will be higher, right? There’s a good reason for that.
Most airlines begin selling tickets about 330 days before departure. That means today you can buy a ticket for late September 2015. You might think that when schedules become available for sale, the airlines would have spent all kinds of time perfecting them and optimizing fares. That couldn’t be further from the truth.
In reality, the airlines pay almost no attention to schedules for next September when they go up for sale. They put out a schedule that’s likely to somewhat resemble what they want to fly, but you can still expect a lot of obnoxious schedule changes between now and then. They also aren’t really actively controlling which fare levels are available for sale on any given flight. They certainly aren’t putting any sales out there. The reason is simple. Nobody is booking domestic flights for next September right now. It’s just too far out there.
As we get closer to departure, the airlines start seeing more bookings come in and they begin to more actively manage the availability on those flights. They’ll also think about filing sale fares for off-peak periods. At the same time, more leisure travelers begin coming into the window when they want to start booking. Lower fares and more demand mean that the average fare is going to come down.
At about 2 months out, ARC shows that fares start creeping up, but it should be pointed out that it’s not much of a climb at first. As flights start to fill up more, the more popular ones will see their cheapest fares shut off. So the average fare starts to climb slowly. About 21 days in advance, however, fares shoot through the roof.
The reason for that is because that’s when most advance purchase rules begin kicking in. Before, the cheapest seats are only blocked from flights that are filling up. But at 21 days out, a lot of the cheap fares become ineligible to book due to the fare rules. It’s a hard cut-off. More of that happens at 14 days and again at 7 days. Even an empty flight will only sell a ticket at a much higher fare 2 days out because the fare rules dictate that. And that happens because last minute travelers are willing to pay more. The airlines don’t want to dilute that revenue opportunity.
Now take a look at the international chart.
You’ll see that the dip after schedules are first filed is much less shallow here, and the cheapest fare is found much further out (171 days to be exact). International schedules change much less often, and carriers may start paying attention to those flights sooner. In addition, people simply book further in advance on international flights because international travel requires a lot more planning. It could be a big summer vacation, or maybe it’s a one in a lifetime trip to visit family. No matter the reason why, international travel gets booked earlier.
Fares also begin to climb dramatically more than 50 days out. That’s partially because when people book earlier, planes fill up more quickly. But I’d bet there’s also the issue of huge advance purchase rules on business class tickets. I’ve seen business class fares with as much as a 90-day advance purchase, really targeting someone who is truly a leisure traveler. When those get cut off, fares go up.
This is all nice, but what does it mean for you? Well, book a couple months out for domestic travel (or really, between 1 and 3 months), and you’ll be in the sweet spot in most cases. That’s probably sound advice if your plans are firm. Of course, it could be different if it’s a holiday or a big event. In those cases, you may want to book further out just for peace of mind if nothing else.
Internationally, you can book further out if you want, but fares aren’t going to change all that much until a couple months in advance. That may impact business class travel more than coach, but it’s still good. If you know your plans two months out, you might as well buy your tickets.
(Before I go, keep in mind that this is never 100% accurate. It’s pretty general advice, so my advice from Friday’s post still stands. Look for tickets when you’re ready and buy if the price works for you.)
