Airline ancillary revenue projected to be $59.2 billion worldwide in 2015
IdeaWorksCompany, the foremost consultancy on airline ancillary revenues, and CarTrawler, the leading provider of online car rental distribution systems, project airline ancillary revenue will reach $59.2 billion worldwide in 2015. The CarTrawler Worldwide Estimate of Ancillary Revenue represents a giant increase of 163% from the 2010 figure of $22.6 billion, which was the first year for the ancillary revenue estimate.
The Airline Manual for Merchandising
The basic fare with a la carte extras has given way to bundling, branded fares,and the promise of personalized pricing. Visit the websites of leading airline retailers today and you will see a robust display of various pricing methods. Consumers encounter branded fares, service bundles, subscription plans with prices that are fixed, flexible, or dynamic. Someday they will also encounter pricing which is aimed at them as individual consumers. The latest report issued by IdeaWorksCompany is designed to prepare industry professionals for the decision-making required to take merchandising to the next level with examples from the world of airline retail.
Marriott Rewards Found to Offer Best Reward Payback Among Leading Global Hotel Loyalty Programs
Marriott Rewards returns an average of 9.4% from room night spending as reward stay value in the first Switchfly Hotel Reward Payback Survey. That’s a 54% higher return than the reward value provided by Starwood SPG, which was ranked last among the four hotel loyalty programs at 6.1% for reward payback. During July 2015, IdeaWorksCompany conducted 1,440 reward queries for key hotel brands in four global frequent guest programs: Hilton HHonors, IHG Rewards, Marriott Rewards, and Starwood SPG. The result provides an average “reward payback” for each program, which is described in this press release.
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Switchfly Hotel Reward Seat Survey 2015 Graphic
2015 CarTrawler Yearbook of Ancillary Revenue by IdeaWorksCompany
The 2015 CarTrawler Yearbook of Ancillary Revenue by IdeaWorksCompany examines 63 airlines that disclosed revenue in financial filings during 2014 from sources such as frequent flier miles sold to partners, fees for checked bags, and commissions from car rentals. The Yearbook’s individual airline listings clarify the type of ancillary revenue activity for each carrier. New for 2015 is a list of the a la carte items sold through Amadeus, Sabre, and Travelport for each of the 63 disclosing airlines.
2014 Airline Ancillary Revenue Leaps to $38.1 Billion – Up Nearly 21% in a Year
For the eighth consecutive year, 63 airlines tracked by IdeaWorksCompany reported substantial increases in revenue from retail activities and the sale of a la carte services and frequent flier miles. The IdeaWorksCompany study, sponsored by CarTrawler, focused on 63 airlines which disclosed qualifying revenue activity, to reveal that ancillary revenue reported by these airlines was $38.1 billion for 2014.
Brussels Airlines, JetBlue, KLM, and United Rev Up Their Ancillary Revenue Engines
The most recent ancillary revenue report sponsored by CarTrawler celebrates retail and merchandising innovations that support ancillary revenue. It offers a collection of examples that rely upon technology and training to create a type of mercantile seduction that encourages consumers to open their wallets and spend. Vendors were invited to share details of client success stories. These were included with other examples, such as JetBlue and Tuifly.com, to create a report filled with services and products that stimulate the imagination and a carrier’s income. The examples in this report demonstrate the revenue power harnessed when companies engage their customers with attractive storefronts, be they in the city center, online, or up in the air.
Southwest and airberlin Still Tops for Rewards, but Alaska Airlines and Avianca Jump in the Rankings
IdeaWorksCompany releases results from the 6th annual Switchfly Reward Seat Availability Survey. Value-oriented airlines dominate the top tiers of the 6th annual Switchfly Reward Seat Availability Survey. Airberlin, Southwest, and Virgin Australia have placed within the top six in every edition of the reward survey since 2010. But global network carriers Air Canada (and the Aeroplan coalition loyalty program), Lufthansa, and Singapore are now in the top 5. Once again, airberlin and Southwest share first place with outstanding 100% scores; every flight queried in the survey provided reward seats at saver-style levels.
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Swithfly Reward Seat Availability Survey Graphic
Airlines Woo Members with Wild, Weird and Wonderful Rewards
IdeaWorksCompany recently reviewed the frequent flier programs of 160 airlines around the world to gather examples of alternative rewards such as unique experiences, event tickets, and retail goods. Beyond the benefit of reducing reward liability, alternative rewards can encourage members to interact more frequently and deeply with the program. In addition, a thoughtful selection of rewards can create a personality for the frequent flier program and ultimately the airline. Does the program wish to be playful, luxurious, or socially aware? Through its review of programs worldwide, IdeaWorksCompany offers examples of 25 alternative rewards ranging from the extravagant to everyday comforts.
Boost Ancillary Revenue Through Empathy, Competence, and Kindness
Michael O’Leary, the CEO of Ryanair, recently admitted “If I had known being nicer to our customers was going to work so well, I would have done it years ago.” As notable as O’Leary’s epiphany is to the airline industry, it’s worth pointing out that the proven value of empathy, competency, and kindness precedes his recent directives to be nice to customers. The latest report from IdeaWorksCompany explores how airline management teams can work together for the greater good of their customers, employees, and investors. Call it a back-to-basics mantra, but sometimes in a technology riddled world, we all can benefit from a few therapeutic reminders to reset our moral compasses. By using the inherently human qualities of empathy, competence, and kindness, the report offers advice to airline management teams to boost ancillary revenue.
Profit From Innovation: Ancillary Revenue Examples From Around the World
Buckle up for a global tour featuring network carriers, LCCs, and companies outside the airline industry. IdeaWorksCompany and CarTrawler offer a global a la carte buffet from 20 companies including Aer Lingus, Amazon, American Airlines, Lufthansa, and Tune Hotels The latest IdeaWorksCompany report reviews innovations that rely upon consumer desire for more comfort, convenience, and certainty. A la carte places consumers in control of the travel process. The companies featured in this report know that when a service provides good retail value consumers will click to buy it.