Airline Economics
Interactive tools that make the airline business easier to see: where the planes are, where people want to fly, and how seats, points and cargo space are sold. Simulators run on illustrative numbers, maps and benchmarks on public data, and each topic starts with a short course drawn from my years in Revenue Management and Loyalty.
Revenue management
The course first, then the tools in the order its chapters use themRevenue Management
How airlines price seats and fill planes as profitably as possible: a mix of economics, statistics and a bit of psychology.
Read the courseFare family designer
Build Basic, Standard and Flex from bags, seats, changes and refunds, and see which customers pick which family and what the upsell earns.
How a fare is built
From a filed fare to the price on screen, one layer at a time: fare rules, surcharges and taxes, then fare families and extras.
Booking curve forecaster
Watch a flight's bookings build up and compare five ways airlines forecast where they'll finish, scored on a year of departures.
Demand unconstraining
Bookings stop when a flight closes. Five ways to recover the demand that was turned away, and what it says about a bigger aircraft.
Booking limits
How many seats to keep for late, high-fare passengers: Littlewood's rule on two fares, EMSR on six, then overbooking.
Buy-down simulator
Why seat control spirals down once fares lose their restrictions, and how Q-forecasting with fare adjustment stops it.
Network bid prices
Why airlines moved from fare-class limits on each flight to origin-destination control, with bid prices from a linear program.
Continuous pricing
A ladder of fare classes against a price that can be set at any amount: how much more it earns, and how much a finer ladder captures.
Network planning
Where to fly, when, and with which aircraftNetwork Planning
How airlines decide where to fly, how often, when, and with what aircraft.
Read the courseAir travel flows
The biggest city-pair markets by passengers actually travelling, and which ones still have no nonstop flight.
Hub banks
How Air Canada and WestJet time their hubs in waves of arrivals and departures, and how many connections each wave creates.
Fleet assignment
Which aircraft type should fly each of 30 flights at a hub: an integer program solved in your browser, against a simple greedy rule.
Aircraft range map
Which destinations an aircraft reaches from any airport, and with how many passengers. Compare two types, like the A321XLR and the 737-8.
Fleet orders & backlog
What each airline has on order from Airbus and Boeing, how old its fleet is, and what it could look like in 2030.
Fleet tracker
Every Air Canada, United, Air France and Etihad aircraft on a live globe: flying, parked at an airport, or likely in maintenance.
Loyalty
Points as a currency, from earning to the balance sheetLoyalty programs
Why airlines give away miles and still come out ahead, and how the points currency behind a loyalty program is managed.
Read the courseLoyalty benchmark
What an airline status is worth on partner airlines, and how many points the same trip earns in each of 13 programmes.
Breakage & liability
How points become deferred revenue and then revenue, and what a new breakage estimate or expiry rule does to the numbers.
Accounting for points
Deferred revenue explained: who gets paid when, the three accounting methods side by side, and how moving the value of a point pays off.
Member lifetime value
What a member is worth over the years, tier by tier, and which levers move it most: retention, tier moves or the co-brand card.
Promotion ROI
Did "double points this month" pay for itself? Incremental trips against a holdout, ROI with a confidence interval, and holdout size.
Net award revenue
Is an award seat worth it? What the program pays against the paid fares the seat displaces, replayed on 1,500 flights after an MIT thesis.
Cargo
Selling the hold rather than the seatsAir Cargo
How airlines sell the space in the hold: weight and volume, forwarders and allotments, and why cargo is harder to sell than seats.
Read the courseCargo revenue management
Why the hold is harder to sell than seats, and how bid prices per kg and per m³ compare with first come, first served.
Allotments vs spot
How much of a freighter to sell to forwarders in advance and how much to keep for the spot market, in a normal year and in 2020–21.
Freighter rotation
Where to fly one freighter for a week: a shuttle, a triangle or a round-the-world loop, and why triangles win on unbalanced lanes.
Belly cargo capacity
How much cargo a passenger widebody can carry once passengers, bags and fuel are on board, and how much to sell before that is known.
Other courses
Beginner's guides to the rest of how an airline sells, plans and measuresAirline Commercial
How a seat becomes revenue: pricing, distribution, sales, e-commerce, payment, partnerships and marketing.
Read the courseOperations Research
The optimization models behind fleet assignment, aircraft routing, crew pairing and disruption recovery, and how they connect to RM.
Read the courseReading the Research
Where each airline OR topic stands, the papers everyone cites, and how to read an AGIFORS talk or journal paper critically.
Read the courseImpact Evaluation
How to tell whether an RM change or a loyalty campaign actually worked: experiments, causal inference and simulations to play with.
Read the course