March 30, 2007

Data Mining for Airfares

A University of Washington professor used data mining to predict when to buy airfares. As these tools become increasingly accessible to people, I expect we will see the pricing sophistication of companies increase. Similarly, in fundraising, we might use data from our database to understand when a person is most likely to give the largest amounts, make certain types of gifts, or be willing to volunteer.

In 2003, Etzioni and colleagues published a paper showing that they could predict the fluctuation in airline-ticket prices surprisingly well. By sifting through the history of more than 12,000 airfares for nonstop flights from Seattle to Washington, D.C., and from Los Angeles to Boston, the researchers could predict with 62 percent accuracy whether or not those ticket prices would rise or fall in the future.

Read More