Meet Me in the Middle

When it comes to flying, most passengers have strong preferences over where they sit. Anyone who has flown on Southwest Airlines, which allocates seats on a first-come, first-served basis, rather than assigning them, knows that the middle seat is the least desirable among flyers. As a result, most airlines have looked to increase profits by charging customers extra to choose more desirable seats, such as window, aisle, or emergency exit rows.

While some passengers may be willing to sit in a less desirable seat to save a little money, forty-one percent of respondents in one poll said sitting in a bad seat would “ruin their flight.” Faced with the fact that on any full flight roughly one-third of passengers would have to sit in the middle seat (thus, be more likely to be dissatisfied), Virgin Australia airlines came up with a clever idea to make sitting in the middle seat more “fun.” The airline recently launched a Middle Seat Lottery, where passengers sitting in the middle seats will be entered to win prizes from a pool valued at around $145,000. Prizes include a helicopter pub crawl, private vacations, flights and tickets to sporting events, and more.

While it is unlikely that the program will induce more people to fly, it may make some passengers a little more willing to meet in the middle.

Discussion Questions:

1. Would consumers prefer a small chance at winning a prize over a guaranteed discount on their price? Explain in terms of utility vs. expected utility.

2. What motivations might Virgin Australia have to implement this program other than making passengers in the middle row more satisfied?

3. How does this program affect middle seat passengers’ consumer surplus?

Sources| CNN Travel: Airline launches lottery to entice more passengers to sit in the middle seat; Reuters: Most passengers prefer to choose airline seat: survey; Unsplash: Inside airplane photo