Farecast, an Internet startup, is
guaranteeing a low fare for up to seven days.
Fare Guard, a service
introduced a week ago, doesn't secure a low fare on a particular
flight but guarantees the protected low fare on the day of
booking.
Farecast, launched in
May on a limited basis and still in beta, displays flights to 75
U.S. cities. It is in the business of predicting whether fares will
rise, fall or hold steady.
"Essentially, we are
putting our money where our mouth is and giving customers peace of
mind," said Hugh Crean, Farecast's president and CEO.
The new service
enables a user to protect a low fare for up to seven days for a
$9.95 fee. For example, a consumer would pay $9.95 to safeguard a
$280 fare when Farecast posits that the fare will remain stable or
decline over the next seven days.
If the lowest fare on
the day of booking ends up being $305, Farecast would issue a check
for $25, the difference between the protected fare and the lowest
fare.
The consumer wouldn't
be locked into booking the $305 ticket and could buy a
higher-priced one. But the redemption check would only reflect the
difference between the guarded price and the lowest fare on that
route on the day of booking.
If consumers don't
buy an airline ticket after purchasing Fare Guard, they don't get
the fee reimbursed.
Farecast issues
e-mail updates about fares for a consumer's selected city pair for
seven days following the purchase of Fare Guard.
"If fares increased,
you would see the Fare Guard redemption value," Farecast stated.
"If fares dropped, you would see the savings
opportunity."
If the lowest fare on
the day the consumer books a flight is the same or lower than the
guarded fare, then Farecast keeps the Fare Guard fee.
Farecast uses ITA
Software's search technology for fare shopping and forwards
consumers to airline Web sites for bookings. The exception is for
bookings involving more than one airline. Farecast refers consumers
to Orbitz for
these bookings.
Crean said Farecast
believed that airline Web sites provided the best value proposition
because they did not charge booking fees and offered incentives
such as bonus frequent-flyer miles.
Farecast doesn't make
money from all of the bookings it generates because the company has
agreements with some airlines and not others.
Crean said that
although Farecast's flight displays are unbiased, the company has a
relationship with Yahoo in which Farecast receives revenue on a
cost-per-click basis for text and banner ads.
To contact reporter Dennis Schaal, send e-mail to
[email protected]