Nobody likes to pay more for something that he or she could have purchased for a lower price — especially if nothing of value is added to justify a higher price — but at least two reasons exist as to how dynamic pricing is good for travel.

How Dynamic Pricing is Actually Good For Travel

People like predictability, which is why the removal of award charts is perceived as a devaluation: if someone is scrimping and saving enough cash or miles to travel, he or she would like to know how much that travel will cost. Having the prices increase before the end goal is reached and the cash is spent or the miles or points are redeemed can result in frustration — and even mistrust. Dynamic pricing is a form of flexible pricing that removes that predictability…

…so how could dynamic pricing actually be good for travel — and for many other industries in general, for that matter?

At least two advantages result from dynamic pricing:

1. Lower prices.

When Delta Air Lines used to have static award charts for its SkyMiles membership program ten years ago, the lowest price for which you can redeem SkyMiles for a round trip award ticket in the economy class cabin was 25,000 SkyMiles — unless you were fortunate enough to embark upon an occasional sale which was only valid during a certain period of time…

The award chart shown in the graphic above is from 2015. Source: Delta Air Lines.

…but as a random example when searching for a round trip award ticket in the economy class cabin between Atlanta and Chicago, you can pay as little as 11,200 SkyMiles during the month of August of 2025…

Source: Delta Air Lines.

…and only two days out of the month do redemption prices exceed 25,000 SkyMiles — to 26,000 SkyMiles.

Conversely, of course, the most a person used to pay for a round trip award ticket in the economy class cabin ten years ago was with 200,000 SkyMiles between the United States and South Africa…

Source: Delta Air Lines.

…but today, the lowest price during the month of August of 2025 is 220,000 SkyMiles, which really is not all that bad of an increase over ten years if your travel plans are flexible enough — but then, you could also pay as much as 300,000 SkyMiles with approximately one third of the cost of taxes and fees as well.

Redemption rates are not taken into account for Basic Economy fares, which offer fewer benefits than what the lowest priced fares offered back in 2015 — but Basic Economy fares were not included in any of the aforementioned examples, as those redemption rates are for Delta Main fares.

With dynamic pricing, redemption rates for more popular flights potentially could cost more money, which segues into…

2. More Availability For More People.

When prices are low, the perceived value of a product or service is typically considered to be of less value. When no price at all is implemented on a product or service, it is usually considered to be disposable. Using drinking water as an example, people in developed areas of the world tend to take drinking water for granted, as it is plentiful from faucets and bottles, clean, and priced low enough that most people do not have to think about it — people in fact often waste water unnecessarily — plus, they automatically trust that it is clean…

…but when a natural disaster strikes, clean drinking water can suddenly become scarce — and people need water to survive. Demand for water becomes substantially higher to the point where it temporarily becomes a commodity. Some people who are in a panic will attempt to purchase as much water as they can get so that they can have peace of mind in riding out the natural disaster, which brings uncertainty and disrupts the predictability of availability…

…as well as disrupts the predictability of price as well. Although price gouging — which is when merchants take unfair advantage of an emergency by hiking prices beyond reasonable levels — is illegal in many jurisdictions, charging reasonably higher prices for bottles of water during an dire situation due to low supply ensures that merchants have more water available to those who need it because people will purchase less water when the price is higher.

A similar phenomenon relates to travel: when a product or service becomes popular to the point when it is only available to a few fortunate people — or it is priced too low to be sustainable for the company that offers it — nobody else benefits from it. If a room at the Waldorf Astoria Maldives Ithaafushi resort property was only 30,000 Hilton Honors points per night, the resort property would be consistently sold out as the supply of rooms would constantly be depleted…

…but at 1,290,000 Hilton Honors points per night for a premium room in a tropical climate when the weather is usually colder in the northern hemisphere — which for many people might be considered too expensive or even usurious — availability is almost guaranteed for anyone who wants it and can afford it. A rare premium room is available on Monday, September 1, 2025 for 818,000 points.

Using the Waldorf Astoria Maldives Ithaafushi resort property as an example is extreme, as one can find better value at countless other destinations worldwide within the brand portfolio of Hilton that are less opulent; but it demonstrates that higher prices increases availability to more people.

Another example was used in this recent article pertaining to the reason why the fifth award night may not be completely free:

A room at the Hilton Garden Inn New York/Times Square Central hotel property typically costs 80,000 Hilton Honors points per night; but for Wednesday, December 31, 2025, the redemption rate for that night is 150,000 Hilton Honors points — which was still available at the time this article was written — for the privilege of having a comfortable room near the famous annual festivities of New Year’s Eve at Times Square in New York.

If the rate for that room was 40,000 Hilton Honors points — or even the typical 80,000 Hilton Honors points — that room might be sold out or unavailable by now.

Final Boarding Call

Photograph ©2006 by Brian Cohen.

Over the years, I have seen countless low fares or rates that have been mistakenly advertised. The first instinct is usually for people to snatch up that fare or rate as soon as possible, which results in the fare or rate being sold out quickly and no longer available — if the company had not already reverted the fare or rate back to normal. Sometimes people would purchase as many rooms or airline tickets as possible — including for the purpose of resale at a higher price, which is typically discouraged — before other people could even have the opportunity to purchase them as well.

Another example is when the now-defunct Daily Getaways annually offered World of Hyatt points at prices that were low enough that they would be sold out in seconds. A few lucky people would celebrate their win — but most people would up empty-handed to the point where they did not even bother to try again when it was available the following year. If the prices were higher — and, yes, if more quantities of that offer were available — then more people would be able to enjoy award stays at hotel and resort properties within the brand portfolio of Hyatt at a discounted rate.

Like most anyone else, I like taking advantage of a good deal. I do not enjoy paying higher prices with my hard-earned money without receiving more in return — nor do I necessarily like unpredictability in general let alone that of dynamic pricing — and like other people, I tend to bemoan about devaluations at times…

…but with few exceptions, the choice is generally as follows:

Keep the fares, rates, and prices at a static level — only to have the supply of products or services that are more in demand depleted or unavailable faster and more often; and the pricing of products and services that are less popular stay static at the same price — or… Use dynamic pricing to increase the fares, rates, and prices on more popular products and services to better ensure increased availability while simultaneously decreasing fares, rates, and prices on products and services whose demand is low.

Companies that provide travel options should not try to purposely suck as much money, miles, or points as they can from customers without providing some proportional amount of value in return — simply having a product or service available during the most popular times is one of numerous items can be perceived as added value — but companies are in business to earn revenue and profit from it. Without revenue and profits — as well as positive cash flow — companies cannot stay in business, as demonstrated by Pan American Airways, Trans World Airlines, Continental Airlines, US Airways, Braniff Airlines, National Airlines, and countless airlines that are now defunct or have been acquired by another airline.

Knowing that you cannot always have your cake and eat it too, which would you prefer?

All photographs ©2006 and ©2013 by Brian Cohen.