AI or Bait-and-Switch? When Smart Tech Turns Against Customers

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“The issue of trust does not lie in the technology, it lies in the culture.” – Rachel Botsman

Imagine walking into a store where the price tags adjust based on how much the company thinks you can afford. That’s the digital equivalent of what this AI does. Airlines might call it yield management 2.0. But to customers, it feels like bait-and-switch – fares rising not from demand, but because an algorithm thinks you’ll tolerate it.

When did innovation start to mean tricking the very customers we’re meant to serve? As a thought leader in customer experience, I’ve been reflecting on this question while watching a troubling trend take off in the airline industry. Some airlines are using artificial intelligence not to improve service, but to play a digital-age shell game.

The Allure of AI-Powered Pricing – and Its Dark Side

At first glance, letting AI set prices sounds like efficiency. Airlines already adjust fares based on demand, timing, and traveller profiles. In fact, they’ve long used “fare fences” – rules like staying over a weekend or booking early – to charge more to travellers who are less flexible. Traditionally, these tactics had some logic and transparency to them. But with AI, the game has changed. AI can crunch vast data in real time and pinpoint the highest price each individual customer might pay.

Delta Air Lines has been at the forefront of this experiment. Delta’s President, Glen Hauenstein, openly discussed using AI tools to overhaul how tickets are priced. The goal is to identify the maximum a traveler will pay for a seat without driving them away. In testing, Delta saw “amazingly favorable” revenue results from these AI-driven prices. By the end of this year, Delta plans to have AI setting fares on 20% of its domestic flights, up from just 3% earlier. Delta once described its AI as a “constantly-on super-analyst” tailoring prices to each individual traveller.

Breach of Trust at 30,000 Feet

Airlines have a hard enough time earning customer loyalty; eroding it with deceptive pricing is a self-inflicted wound. Many described Delta’s AI pricing approach as “bait and switch” and a breach of trust. I find myself agreeing. When a company lures you with one fare only to nudge it higher using an algorithm, it violates the unwritten contract of fairness. 

What’s more, these schemes create negative customer experiences. Take another recent pricing ploy: several airlines quietly tested charging single travelers more per ticket than people flying in pairs. Essentially, if you booked alone, you paid a higher fare for the exact same itinerary than if you booked with a companion. Under public pressure, Delta and United Airlines actually backed off that particular solo-traveler surcharge – but not by making solo fares cheaper. Instead, they reportedly raised the multi-passenger fares to match the higher single rate. In other words, when called out, they removed the discount rather than the surcharge. If that isn’t counter-intuitive, I don’t know what is. It shows how far some airlines will go to squeeze a bit more revenue, even at the expense of goodwill. 

As a customer-centricity advocate, these examples concern me deeply. Trust, once broken, is awfully hard to repair. In my LinkedIn Learning course, I talk about how companies can maintain, regain, and earn customer trust – especially when technology is involved. Every time an airline’s AI pricing scheme makes a customer feel cheated, a “trust account” is being drained. The effects might not show up immediately on a balance sheet, but they will fester in customer sentiments and future behaviors. As loyalty guru Fred Reichheld warns, profits earned at the expense of customer relationships are “bad profits” – they come from unfair or misleading practices, and they choke off long-term growth. If a dollar of revenue today creates a detractor tomorrow, is it really worth it?

AI as a Tool for Service, Not Deception

It doesn’t have to be this way. AI itself isn’t malevolent; it’s all about how we choose to use it. In my work, I often stress that technology should augment genuine value, not mask the lack of it. There is a better path for airlines and any business embracing AI. Imagine AI that helps an airline predict maintenance issues before they cause delays, or an AI that proactively reroutes stranded travellers during weather disruptions – that builds trust. When a flight is canceled, an AI-driven system could instantly rebook affected passengers and notify them, reducing stress. All of this uses artificial intelligence, but in an assistive way – to enhance the experience, not to manipulate it.

Airlines operate in a competitive environment where loyalty is fragile. Using advanced technology to outfox your own customers is a sign of outdated, product-centric thinking – the mentality that the customer is a target to exploit, rather than a partner to serve. This mindset is what needs disruption. The most visionary leaders today understand that long-term success comes from trust and loyalty. As management legend Peter Drucker famously said, “The purpose of business is to create and keep a customer.” That purpose is undermined if our shiny new AI tools cause customers to feel tricked instead of valued.

Charting an Ethical Flight Plan for AI

So, how do we move forward? The answer isn’t to shun AI, but to embed ethics and customer-centric culture into AI strategies from day one. We, as leaders, need to ask tough questions in the boardroom and data science labs alike: 

1. Just because we can do this with AI, should we? 

2. Will this use of AI make our customers’ lives easier?

3. Are we preserving the basic principles of honesty and fairness that our brand stands for? 

If any of those answers are uncomfortable, it’s time to hit pause and rethink. One practical step is to establish clear guiding principles for AI use in pricing, marketing and operations. For instance:  

• Commit that your company will never use personal data to secretly charge individuals different prices for the same product in ways they would deem unfair. (If there are justifiable reasons – say, giving loyal members better deals – make sure it’s transparent and opt-in.) 

• Also, invest in AI that improves operations and employee capabilities: route optimisation, customer support chatbots that actually resolve issues, personalised assistance. 

These investments pay off in customer satisfaction, which in turn pays off in repeat business.

Conclusion

Remember that trust, once lost, is expensive to regain – far more expensive than any incremental fare increase an algorithm might squeeze out today.

As Reichheld notes, bad profits “blacken a company’s reputation and make it vulnerable to competitors”.

Finally, if your company culture values customers as just numbers on a revenue report, even the best AI will be used poorly. But if you cultivate a culture of empathy, integrity, and long-term thinking, you will wield AI in service of those values. The quote I opened with resonates here: trust is a cultural issue. An organisation that truly puts customers first will naturally ask, “How can AI make our customers happier?” instead of “How can AI make our customers pay more?”

As for me, I’m committed to steering us all toward a future where AI, customer experience and trust go hand in hand, because anything less is a failure of leadership and imagination.

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