System and method of protecting prices

• US 20080114622A1
• Filed: 11/13/2006
• Published: 05/15/2008
• Est. Priority Date: 11/13/2006
• Status: Active Grant

• Current Assignee: Microsoft Technology Licensing LLC (Microsoft Corporation)
• Original Assignee: Farecast, Inc. (Microsoft Corporation)
• Inventors: Crean, Hugh, Hsu, David, Fridgen, Michael, Etzioni, Oren, Bartot, Jay
• Granted Patent: US 7,797,187 B2
• Time in Patent Office: Days
• US Class Current: 705/5
• CPC Class Codes: G06Q 10/02 Reservations, e.g. for tickets, services or events
• CPC Class Codes: G06Q 20/10 specially adapted for electronic funds transfer [EFT] systems; specially adapted for home banking systems
• CPC Class Codes: G06Q 20/4016 involving fraud or risk level assessment in transaction processing
• CPC Class Codes: G06Q 30/02 Marketing; Price estimation or determination; Fundraising
• CPC Class Codes: G06Q 30/0206 Price or cost determination based on market factors
• CPC Class Codes: G06Q 30/0207 Discounts or incentives, e.g. coupons or rebates
• CPC Class Codes: G06Q 30/0283 Price estimation or determination
• CPC Class Codes: G06Q 30/0609 Buyer or seller confidence or verification
• CPC Class Codes: G06Q 30/0633 Lists, e.g. purchase orders, compilation or processing

Abstract

A method and system for protecting prices is provided. The price protection system increases consumer confidence when making purchases by reducing the risk associated with fluctuating prices. The price protection system receives a purchase specification from a consumer. Next, the price protection system determines the risk that the prices of items matching the purchase specification will change and reports a protected price to the consumer that represents the price that the price protection system will protect based on the determined risk for a protection period. Finally, the price protection system receives a request from the consumer to purchase protection of the protected price.

Claims

1. A price protection system for protecting an flight itinerary price, the system comprising

a component that receives predictions of likely directions of ticket prices for flight itineraries;

a component that receives a request for ticket price information for a desired flight itinerary specification;

a component that offers to sell price protection for a protected price for the desired flight itinerary specification when the predictions indicate that the likely direction of a ticket price for the desired flight itinerary specification make it desirable to sell price protection;

a component that, when a purchaser purchases the offered price protection for the desired flight itinerary specification and subsequently purchases a ticket for the desired flight itinerary specification, establishes a redemption price for the price protection and compensates the purchaser based on the protected price and the redemption price.

2. The system of claim 1 wherein it is desirable to sell price protection when the likely direction is to decrease.

3. The system of claim 1 wherein it is desirable to sell price protection for some flight itinerary specifications when the likely direction is not to decrease.

4. The system of claim 1 wherein the protected price is the lowest ticket price for the desired flight itinerary specification at the time of the offer.

5. The system of claim 1 wherein the redemption price is the lowest ticket price for the desired flight itinerary specification when the ticket is purchased.

6. The system of claim 1 wherein the compensation is the difference between the redemption price and the protected price.

7. The system of claim 1 wherein the purchaser is compensated only when a ticket the desired flight itinerary specification is purchased within a protection period.

8. The system of claim 7 wherein the protection period is variable based on risk associated with the price protection.

9. The system of claim 1 wherein the price protection is offered for a protection fee.

10. The system of claim 9 wherein the protection fee is fixed.

11. The system of claim 9 wherein the protection fee varies based on risk associated with the price protection.

12. The system of claim 1 wherein it is desirable to sell price protection when the likely direction is to decrease, wherein the price protection is offered for a fixed protection fee and for a fixed protection period, and wherein the compensation is the difference between the redemption price and the protected price.

13. The system of claim 1 including a component that receives a request for compensation from the purchaser, verifies purchase of the ticket, and authorized compensation.

14. A method of protecting an airline itinerary price, the method comprising:

receiving an itinerary specification from a purchaser that describes information about desired itineraries;

receiving predictions of price fluctuations for itineraries matching the itinerary specification; and

offering to the purchaser price protection at a protected price for a subsequent purchase of a ticket for an itinerary matching the itinerary specification for a protection period based on the predictions.

15. The method of claim 14 further comprising after receiving the itinerary specification, reporting currently available itinerary prices to the purchaser.

16. The method of claim 14 further comprising receiving a request from the purchaser to purchase the price protection.

17. The method of claim 14 wherein the protection period comprises a fixed time period.

18. The method of claim 17 further comprising if a ticket for an itinerary matching the itinerary specification is subsequently purchased by the purchaser for a price greater than the protected price, paying the purchaser an amount based on the difference between the purchase price and the protected price.

19. The method of claim 17 further comprising if a ticket for an itinerary matching the itinerary specification is later purchased by the purchaser for a price greater than the protected price, paying the purchaser an amount based on the difference between a lowest price available for a ticket for an itinerary matching the itinerary specification and the protected price.

20. The method of claim 14 wherein offering of price protection comprises requesting a protection fee.

21. The method of claim 20 wherein the protection fee requested varies based on the prediction of price fluctuations.

22. A computer-readable medium containing instructions for controlling a computer system to reduce risk associated with fluctuations in the price of an item, by a method comprising:

submitting an item specification to a price protection service;

receiving from the price protection service a predicted price for the item along with price protection; and

when the item is subsequently purchased, receiving compensation when the purchase price for the item is more than the predicted price.

23. The computer-readable medium of claim 22 further comprising receiving a degree of confidence in the predicted price.

24. The computer-readable medium of claim 22 further comprising receiving a recommended action based on the predicted price.

25. The computer-readable medium of claim 22 further comprising receiving a history of prices based on the submitted item specification.

26. A computer system for providing price protection, comprising:

a receive ticket specification component configured to receive a ticket specification that describes information about one or more tickets;

a determine protection price component configured to determine a protection price for a ticket matching the ticket specification based on received predictions of price fluctuations in prices of tickets matching the specification;

a receive protection request component configured to receive a request to purchase price protection for the protection price; and

a redeem protection component configured to process redemption requests for compensation for purchased price protection based on the protection price and a redemption price.

27. The system of claim 26 wherein the receive protection request component limits the number of price protection requests at a time open.

28. The system of claim 26 wherein the receive protection request component limits the duration of the price protection.

29. The system of claim 26 wherein the receive protection request component limits the markets for which price protection requests are accepted.

30. The system of claim 26 wherein the receive protection request component does not accept requests for protection when the determined risk exceeds a threshold.

31. The system of claim 26 wherein the redeem protection component limits the time period for submitting redemption requests.

32. The system of claim 26 further comprising a validate redemption request component that verifies an actual purchase price of the ticket.