System and method of protecting prices

• US 7,797,187 B2
• Filed: 11/13/2006
• Issued: 09/14/2010
• Est. Priority Date: 11/13/2006
• Status: Expired due to Fees

• 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
• Primary Examiner(s): BORISSOV, IGOR N
• Application Number:
  US11/599,607
• Publication Number:
  US 20080114622A1
• Time in Patent Office: 1,401 Days
• Field of Search: 705/5, 705/6, 705/7, 705/26, 705/27, 705/14, 705/1.1, 705/10, 705/14.1, 705/14.34, 705/14.38, 705/14.39, 705/400
• US Class Current: 705/7.35
• 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 memory storing computer-executable instructions of

a component that receives predictions of likely directions of ticket prices for flight itineraries based on analysis of historical pricing information;

a component that receives from a purchaser a request for ticket price information for a desired flight itinerary specification, the desired flight itinerary indicating characteristics of the desired flight;

a component that, prior to the purchaser purchasing a ticket for the desired flight itinerary specification, offers to sell for a protection fee 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 a flight that matches the characteristics of the flight as indicated by the desired flight itinerary specification make it desirable to sell price protection;

a component that, prior to the purchaser purchasing a ticket for the desired flight itinerary specification, sells the offered price protection to the purchaser for the protection fee; and

a component that, after the purchaser purchases the offered price protection for the desired flight itinerary specification and subsequently purchases a ticket for the desired flight itinerary specification at a purchase price that is higher than the protected price, establishes a redemption price for the price protection and compensates the purchaser based on the protected price and the redemption price, the redemption price being based on a ticket price for the desired flight itinerary specification after the purchaser purchases the price protection and being identified independently of the purchase price, wherein the purchaser is compensated only when a ticket for the desired flight itinerary specification is purchased within a protection period, and wherein the protection period is variable based on risk associated with the price protection; and

a processor for executing the computer-executable instructions stored in the memory.

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 price protection is offered for a protection fee.

8. The system of claim 7 wherein the protection fee is fixed.

9. The system of claim 7 wherein the protection fee varies based on risk associated with the price protection.

10. 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.

11. 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.

12. A method of protecting an airline itinerary price performed by one or more computers executing instructions of a computer program, the method comprising:

receiving at a computer an itinerary specification from a purchaser that describes characteristics of desired itineraries;

receiving at a computer predictions of price fluctuations for itineraries matching the itinerary specification, the prediction being generated based on analysis of historical price information, an itinerary matching the itinerary specification when the characteristics of the itinerary match the characteristics of the itinerary specification;

offering by the computer, based on the received predictions, 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, the price protection providing protection in the event the purchaser subsequently purchases a ticket for a itinerary matching the itinerary specification at a price higher than the protected price; and

receiving an indication that the purchaser subsequently purchased a ticket for an itinerary matching the itinerary specification at a purchase price;

when the purchase price is greater than the protected price, directing payment to the purchaser for 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, the lowest price being identified independently of the purchase price, wherein the payment is directed to the purchaser only when the ticket for the itinerary matching the itinerary specification at the purchase price is purchased within a protection period, and wherein the protection period is variable based on risk associated with the price protection; and

when the purchase price is not greater than the protected price, indicating that the purchaser is not entitled to payment.

13. The method of claim 12 further comprising after receiving the itinerary specification, reporting currently available itinerary prices to the purchaser.

14. The method of claim 12 further comprising receiving a request from the purchaser to purchase the price protection.

15. The method of claim 12 wherein the protection period comprises a fixed time period.

16. The method of claim 12 wherein offering of price protection comprises requesting a protection fee.

17. The method of claim 16 wherein the protection fee requested varies based on the prediction of price fluctuations.