Why does overbooking benefit the customer?

As a result, airlines can, with a degree of certainty, overbook a flight considering the number of no-shows expected, thereby maximizing the capacity available to customers. For consumers, this practice is beneficial because it allows more consumers to fly at the time, date and fare of their choosing.



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The overbooking process is also said to benefit people who purchase last-minute tickets. If a flight has extra seats available before the flight leaves the gate, these can be sold at discounted rates, which allows the airline to garner some of the revenue that they would otherwise have lost.

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Passengers who are involuntarily bumped from their flight due to overbooking should ask the airline for a written statement explaining the reason for the denial of boarding and their rights to compensation.

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The purposeful and deliberate act of overbooking runs counter to any acceptable standard of ethical business practice. In addition to the practice being ripe with serious legal, contractual and consumer protection violations, overbooking forces hospitality personnel into making conscious immoral and unethical choices.

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Intentionally overbooking means your hotel will have more reservations than available rooms on a given day, but based on historical data or booking trends, the expectation is that some guests will cancel or not show up, opening up rooms for the overbooked guests.

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Consequently, a bad overbooking strategy can cause a lot of damage and a whole lot of stress: from guests to associates. It often leads to bad online reviews, harm to your online reputation, financial loss, and “real-life” complaints. Nevertheless, a good overbooking strategy can bring many benefits.

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Because overbooking involves the intentional and deliberate act of promising more rooms than are actually available, the practice must therefore be associated with a number of ethical and moral dilemmas.

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Overbooking = more profit, but often = unhappy customers. Airlines use statistics to avoid overbooking, resulting in 50k people getting bumped off flights annually. Airlines use data to predict the number of passengers boarding a flight.

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Sometimes, when an airline asks for volunteers to give up their seats and fly on a different flight, there are not enough volunteers. When this occurs, the airline will select passengers to give up their seats. This is called “involuntary denied boarding” or “bumping.”

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Whether you're flying from New York or New Orleans, Lisbon or London, airlines continue overbooking to compensate for “no-shows” all the time. Simply put, they sell more tickets than they have available seats. And it's not an illegal practice.

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Sometimes, when an airline asks for volunteers to give up their seats and fly on a different flight, there are not enough volunteers. When this occurs, the airline will select passengers to give up their seats. This is called “involuntary denied boarding” or “bumping.”

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Advantages of overbooking in hotels
  • Mitigating losses.
  • Achieving full occupancy.
  • Compensation is cheaper than having empty rooms.
  • Availability of prediction methods.
  • Negative guest experience.
  • Potential poor publicity.
  • Take advantage of big data to make informed predictions.


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When you are involuntarily bumped from a flight, you can get cash (a check or credit on your credit card) from airlines. Overbooking is not illegal, and most airlines overbook their scheduled flights to a certain extent to compensate for “no-shows.” Passengers are sometimes left behind or “bumped” from a flight.

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If your flight is overbooked and you're willing to give up your seat, experts advise negotiating with airline staff to drive up your compensation package before accepting. “Many times you can negotiate for things like a better flight, hotel vouchers, meal vouchers and lounge passes,” Keyes says.

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When overbooking in hotels is done intentionally, the risks include: Negative customer experiences that lead to negative word of mouth. Loss of potential revenue from upsells, ancillary services, and in-room upgrades.

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Overbooking, also known as overselling, is the practice of accepting more reservations than rooms you have available. The term can also refer to overbooked flights - we've all been offered vouchers to leave behind a confirmed reservation or airline ticket and the concept is very similar in hotels.

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If there are not enough passengers who are willing to give up their seats voluntarily, an airline may deny you a seat on an aircraft based on criteria that it establishes, such as the passenger's check-in time, the fare paid by the passenger, or the passenger's frequent flyer status.

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Overbooked flight compensation under US regulations
If the airline does not make any substitute travel arrangements for you, you are entitled to 400% of the one-way fare price, not to exceed $1,350 as well as any optional fees paid as part of your reservation (e.g. bag fees, seat upgrades, etc.).

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Passengers may be able to sue if the airline fails to compensate them for rescheduling and delays caused by its overbooking practices. In other cases, a passenger might be able to sue for discrimination if the airline rescheduled them due to their race, religion, or another protected trait.

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