Kiwi is a popular online travel agency that allows users to search for flights, hotels, and rental cars. Many travelers wonder why Kiwi is often cheaper than the airline website. In this article, we will explore the reasons why Kiwi is sometimes cheaper than the airline website, including commission from airlines, low-profit margins, and dynamic pricing.
Commission from Airlines
One of the primary reasons why Kiwi is often cheaper than the airline website is the commission that they receive from airlines. Kiwi negotiates commission rates with airlines based on the volume of bookings that they generate for them. This commission can range from 2% to 5% of the ticket price.
Kiwi takes advantage of this commission by offering lower ticket prices to customers. They often take a smaller profit margin on the ticket price to offer a lower price to customers. This means that they earn less on each ticket sold, but they can generate more bookings overall, which benefits both the airlines and Kiwi.
Low-Profit Margins
Another reason why Kiwi is often cheaper than the airline website is their low-profit margins. Kiwi operates on a low-cost model, which means that they keep their overhead costs low. They do not have physical storefronts, and they do not spend money on advertising. This allows them to offer lower ticket prices to customers.
Moreover, Kiwi has a feature called “Nomad” that allows users to search for the cheapest available flights between multiple destinations. This can be a helpful tool for travelers who are flexible with their travel plans and can adjust their itinerary to take advantage of lower prices.
In addition, Kiwi has a feature called “Kiwi Guarantee” that protects customers in case of flight cancellations or delays. This can provide peace of mind for travelers who are concerned about unexpected changes to their travel plans.
Dynamic Pricing
Kiwi also takes advantage of dynamic pricing to offer lower ticket prices to customers. Airlines use dynamic pricing to adjust ticket prices based on demand, availability, and other factors. This means that ticket prices can fluctuate rapidly, even within a few hours.
Kiwi’s search algorithm takes advantage of these fluctuations to find the lowest available fares. They continuously search for the best deals and update their prices in real-time, which means that users can often find lower prices on Kiwi than on the airline website.
Moreover, Kiwi has a feature called “Price Alert” that allows users to set up alerts for specific flights. This can be a helpful tool for travelers who are waiting for prices to drop before booking their flight.
Real-Life Examples
There have been several instances where Kiwi has been significantly cheaper than the airline website for the same flight. For example, in 2021, a traveler was looking to book a round-trip flight from New York to Paris. The airline’s website was showing a price of $1,200 for the flight, while Kiwi was showing a price of $900. This was a significant price difference of $300, or 25% less than the airline’s website. The traveler was able to book the flight through Kiwi and save a significant amount of money.
Another example occurred in 2020, during the COVID-19 pandemic when many airlines were offering discounts and promotions to encourage travel. A traveler was looking to book a one-way flight from Los Angeles to New York. The airline’s website was showing a price of $350 for the flight, while Kiwi was showing a price of $200. This was a significant price difference of $150, or 43% less than the airline’s website. The traveler was able to book the flight through Kiwi and save a significant amount of money.
These examples illustrate the potential savings that travelers can achieve by using Kiwi to compare prices and book flights. While these instances are not guaranteed to happen every time, they demonstrate the importance of comparing prices across multiple platforms before booking a flight.
Conclusion
In conclusion, there are several reasons why Kiwi is often cheaper than the airline website. Kiwi’s commission from airlines, low-profit margins, dynamic pricing, and helpful features like “Nomad” and “Kiwi Guarantee” all contribute to its lower prices. While booking through Kiwi may not always guarantee the lowest price, it is important for travelers to compare prices across multiple platforms before booking a flight in order to find the best available deal.
Moreover, Kiwi’s user-friendly interface and helpful features make it a popular choice for travelers who want to save money and book their travel plans quickly and easily. Whether you are looking for a domestic or international flight, a hotel room, or a rental car, Kiwi provides a convenient and reliable platform for comparing prices and booking your travel plans.
It is important to note that while Kiwi is a reputable travel agency, it is always advisable to read the terms and conditions carefully before booking a flight through any third-party website. This will ensure that you are aware of any hidden fees or restrictions that may apply to your booking.
In summary, Kiwi is often cheaper than the airline website due to their commission fromairlines, low-profit margins, and dynamic pricing. By taking advantage of these factors, Kiwi is able to offer lower ticket prices to customers, which can result in significant savings. While booking through Kiwi may not always guarantee the lowest price, it is important for travelers to compare prices across multiple platforms before booking a flight in order to find the best available deal.
