As the only platform that provides instant booking for any charter aircraft, from any charter operator, it's a question we get asked a lot: how does SimpleCharters determine charter flight pricing?
Our platform takes in a lot of data from many different sources, fed into a machine learning algorithm to accurately provide a guaranteed price in real time, whenever a user searches for a flight.
Almost all of the costs for a charter flight are readily computed based on flight hours and operating cost per hour. When a user searches for a flight, our algorithm finds all known charter aircraft that are considered eligible for the flight by meeting our strict safety, quality, and reliability standards and determines:
With this information, an estimated price can be determined for each eligible aircraft using each operator's unique pricing model.
When all eligible tails are computed, the algorithm makes an assessment for each aircraft on likelihood of availability using our proprietary availability model. This model takes into account many factors that can contribute to availability, including time of year, peak vs non-peak travel period, time of day, aircraft type, route origin or destination, aircraft type, operator, etc., to produce an accurate prediction of which eligible aircraft the client is most likely to travel on in real time.
Once complete, the algorithm displays the price to the user in real time as a guaranteed price that we stand behind. Our customers instantly book our guaranteed pricing, and then we bring the confirmed and paid-in-full trip to the charter operator our algorithm selected as the best fit for the trip.
Operators love hearing from SimpleCharters because they know every request is a confirmed client ready-to-go on their aircraft that our algorithm has selected as ideal for the client's needs. Compared to closing roughly 1% of quote requests to brokers, charter operators close between 30% and 50% of the quote requests from SimpleCharters, thanks to the accuracy of our platform.
Currently our pricing algorithm is 90% accurate (e.g., 9 out of 10 bookings are successfully and profitably sourced at the price determined by the algorithm).
For the 1 out of 10 bookings we receive that the algorithm price was incorrect (e.g,. the eligible aircraft were all not available or were all out of position, requiring a further away aircraft to reposition farther than estimated to complete the trip), the real work behind the scenes at SimpleCharters begins.
When all of the aircraft selected by our pricing algorithm prove unavailable (e.g., under maintenance, no crew available, away from estimated position, or otherwise unavailable), our immediate concern is making sure our booked client has a successful trip. We quickly engage our client with 1 of 2 options:
Almost always, our clients understand and appreciate our efforts to make sure they have a successful trip even if the repositioning costs are higher than was originally expected. Once our client's needs are met, we get to work behind the scenes improving the algorithm for the future.
We have two primary ways of improving our algorithm's accuracy over time:
For the availability and positioning component of our machine learning algorithm, our system is constantly monitoring live air traffic patterns to make both long-term (e.g., seasonal) and short-term (e.g., next 72 hours) predictions on which aircraft are likely to be available to do trips and where they are most likely to inbound reposition from prior to a trip, followed by where they are most likely to outbound reposition to after completing a trip. Every day our system gets smarter and more accurate for predicting which charter aircraft are likely to be available, and what repositioning will likely be required to complete a trip.
For the pricing component of the machine learning algorithm, every quote we receive from a charter operator is analyzed to understand how they would like to price their aircraft. Taking into account likely positioning, peak vs non peak, or other aircraft specific or operator specific business practices, we update our pricing model to accurately reflect how the operator would like to price their aircraft. Every day our system gets smarter and more accurate at predicting pricing for charter aircraft.
All of the inner workings of the SimpleCharters platform above are applied to every eligible charter aircraft from every charter operator in the world.
For operators that would like to increase their efficiency and margins even more, we offer simple integrations for their fleet schedule that allow our algorithm to more accurately compute their fleet's availability, positioning, and highlight any repositioning or empty legs already on the schedule that can be displaced with a paid flight in real time. Learn more about integrating your schedule with SimpleCharters.
When a client searches an itinerary that can take advantage of a reposition or empty leg on a schedule, our system will suggest to the user to alter their itinerary slightly to take advantage of the savings. We call these Ideal Position Prices, since the identified aircraft is ideally positioned to fly the selected itinerary. All available reposition and empty legs on the schedule are automatically applied to all user searches on SimpleCharters to create Ideal Position Prices.
Would you like to learn more about our pricing and how integrating with SimpleCharters can benefit your team? Contact us today and we will be happy to answer any questions you have!
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