Travel / Meetings / Incentives / Conferencing / Events
The pros and cons of group fares vs individual fares
1 Dec 2017 - by Max Marx
Max Marx reviews trends and issues in groups and incentives travel.
Wit incentive organisers generally under enormous pressure to secure the best fares, there can be temptation to book groups on individual fares when these are cheaper, or to take advantage of fare specials.
However, most airlines require group bookings to be made via their groups departments. Some even have very strict policies around this and will raise an ADM with a travel agency if individual bookings for groups are discovered.
While individual fares may seem attractive, there are disadvantages to booking these for group travel, such as having to submit passenger names upfront and same-day booking confirmations.
It is often impractical for incentive and event decision-makers to comply with these time limits, and corporates may not immediately know who their qualifying incentive or group travellers will be. The same issues face sports teams and school groups.
This is where booking group flights works well. Bookers can block book seats months in advance and only provide passenger details 30 days prior to travel, as is the rule for most airlines. There are usually very few seats available at special advertised fares for individual travellers, and groups are generally excluded from booking these.
Usually the larger the group, the higher the group fare. This is due to airline yield management systems and the tendency for airlines to want to book the entire group in a single fare class.
Mandy McEvoy, Club Travel Corporate’s Westlake branch manager, says online and GDS fares are usually cheaper than group fares as the rules are very different.
“With a group booking, seats and fares are secured with a deposit but no names are required and tickets are not issued. This enables one to make changes to dates, itinerary and names (if already inserted) free of charge. The price and seats will remain secure, with the payment balance only required closer to departure date. After issue, some airlines allow for a complete name swop for a fee, which is not allowed on FIT tickets.”
McEvoy suggests splitting very large groups into two smaller groups and booking them on different flights to avoid a higher fare class.
Ramon Geldenhuys, 360 Degrees Travel md, says it’s imperative to explain group booking terms and conditions to decision-makers so they understand why group bookings usually attract higher fares.
Always use the airline’s booking policy
Airlines vary in their group booking polices and how these are enforced.
Sally George, Singapore Airlines market development manager, says it’s far more advantageous doing group bookings with the airline’s groups department. “It helps with seating arrangements and when large groups book quite far in advance, we can give them competitive fares. Last-minute online deals come with high penalties and you can’t change the booking.”
Lufthansa requires groups to be booked using its Book-a-Group tool. If groups are booked individually, via the GDS, an ADM will be raised with the travel agency.
Booking more than 10 people on British Airways must be done through the airline’s groups department. Bookings made incorrectly are raised with the agent.
Delta Air Lines doesn’t allow travel agents to book groups as individual passengers. When these are tracked, Delta automatically cancels the space. It’s advisable to book groups on Delta at least 90 days prior to departure to avail groups of discounted fares.
Cathay Pacific monitors any malpractice on GIT bookings. It is the airline’s policy that 10 or more passengers be handled as a group booking.
Air Austral’s group fares are generally cheaper than FIT fares and a competitive fare for the whole group is quoted. Group size can be reduced to a minimum of 10 passengers after the initial booking without penalty. A 30% deposit is required within 30 days of flight confirmation and is non-refundable 60 days or less prior to departure.
Wouter Nel, Air Mauritius’s sales and marketing manager, says if groups are booked on FIT fares, the airline’s group value proposition won’t be available to them. Group requests can be emailed to Air Mauritius’s Johannesburg office. “Once the group contract is signed and deposits paid, we release the group to the agent to insert names and issue tickets. This can be done if the agent uses the same GDS as we do.”
Kirby Gordon, FlySafair’s vp: sales and distribution, says while the airline’s system accommodates the full group at the best possible fare, it does its best to improve on those fares, depending on group size. “For example, the system will return a quote for 20 passengers at R799 per ticket, even though there may be three fares available at R599 and five at R699. We can override this R799 fare to provide a better price to the group.”