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How does it make the airline more money to sell you a ticket at a lower price? Your question is framed in terms of a consumer that is already buying tickets at the current price; you need to find the consumer that isn't buying tickets at the current price.

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Or you could be getting consumers who are already buying tickets to buy more tickets. For instance, I average one international flight a year. If I could get flights for cheaper that number would most probably increase...

Airlines try to cater that with frequent flyer programs.

They don't. Frequent flyer programs aren't made to make you fly more, they're made to make you book with the same airline. There's a difference.

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