Revenue-Based Points Accrual May Be the New World Order
Delta Air Lines has certainly created a strong tailwind for itself. Profits are at record levels, corporate debt is declining, lie-flat seating has been introduced globally to business class, and the cash dividend has been increased for shareholders. The airline has expressed a profound eagerness to change almost everything about its business, so it’s not surprising this philosophy finally touched the SkyMiles program. The latest IdeaWorksCompany report reviews how the frequent flier business is positioned for change due to moves made by key players and their desire to revolutionize accrual methods.
Ancillary Revenue per Passenger for 2013 was $16, Up Nearly 129% from 2007
2014 CarTrawler Yearbook of Ancillary Revenue by IdeaWorksCompany compiles results from 59 airlines worldwide. Ancillary revenue now provides the power for airlines to be profitable. The global airline industry hopes to achieve an average net margin of 2.4% for 2014, which is less than $6 per passenger. The first IdeaWorksCompany ancillary revenue report for 2007 identified $2.45 billion from just 23 airlines for an average of $6.99 per passenger. Now, six years later, every aspect of ancillary revenue has dramatically increased, to include a 1,200 percent increase of ancillary revenue disclosed by airlines globally. This has allowed the world’s airline industry to tilt into the column of profitability while keeping fares modest as consumers recover from recession. The 2014 CarTrawler Yearbook of Ancillary Revenue by IdeaWorksCompany was released today as a free-of-charge report sponsored by CarTrawler.
2013 Airline Ancillary Revenue Lifts to $31.5 Billion – Up Nearly 1200% Since 2007
The annual CarTrawler survey of global airline ancillary revenue shows growth to $31.5 billion for 2013 ─ an increase of 1200 percent since the first such survey in 2007. IdeaWorksCompany researched the financial filings made by 114 airlines all over the world, 59 of which disclose ancillary revenue activity, to reveal that ancillary revenue reported by airlines reached $16 per passenger in 2013, easily surpassing global figures for profit per passenger. This press release describes highlights from this research and a top 10 list of best performing carriers in three categories.
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CarTrawler Survey of Airline Ancillary Revenue GRAPHIC
Southwest, airberlin, Virgin Australia Still Tops For Rewards, But Delta and Turkish Airlines Make Big Leaps Upward
Value-oriented airlines dominate the results in the 5th annual Switchfly Reward Seat Availability Survey. Airberlin, Southwest, and Virgin Australia have placed within the top six slots for every edition of the reward survey since 2010. For 2014 airberlin and Southwest share first place with outstanding 100% scores; every flight queried in the survey provided reward seats at saver-style levels. The 25 carriers in the survey remained the same as 2013, except China Southern replaced AirTran as the latter continues to be absorbed by its parent Southwest Airlines.
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Switchfly Reward Seat Availability Survey GRAPHIC
Baggage, Branded Fares and Big Revenue: Top 10 things to know about ancillary revenue
The business upheaval that began in the air travel industry a decade ago has now grown to span the globe, has brought economic vitality back to the world’s airlines, enabled the worldwide boom in low-cost travel, and granted consumers the gift of choice. And the ancillary revenue revolution is spreading its ideas and impacts from air travel into companion industries such as lodging, cruising, car rental, credit cards, dining and more. Top 10 Things You Need to Know about Ancillary Revenue, the newest report from CarTrawler and the IdeaWorksCompany, describes the depth and breadth of this phenomenon, which has transformed the world’s largest industry.
Points, Pillows and Porsches: Hotel and Car Rewards at the Top 30 Airlines
Whether intentional or not, every frequent flier program creates a brand image in the minds of its members. Some airlines take an approach that provides the bare troika of essentials: reward tickets, partner airline tickets, and upgrade rewards. Fortunately for consumers, more of the world’s top airlines choose a more robust retail approach by adding a global selection of hotel and car rental rewards. Of the top 30 airlines assessed by IdeaWorksCompany, the majority provide more reward options with the likely objective being to make their programs more attractive to customers.
VIP for a Fee: Eleven Airlines Now Sell Airport Services Designed for High Value Customers
At the highest level of service and status, airlines will meet and greet passengers at the curb, provide private screening, and whisk them to planeside in a sedan car on the ramp. This level of service eludes most elite-status travelers but is now within the grasp of anyone with the swipe of a credit card. The latest report from IdeaWorksCompany reviews how airlines all over the world now sell extra pampering to passengers for a profit. VIP treatment, such as early boarding, bonus miles, fast track screening, and first class upgrades, has proven to produce the revenue payback eagerly desired by airline management.
Airline ancillary revenue projected to reach $42.6 billion worldwide in 2013
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 $42.6 billion worldwide in 2013. The CarTrawler Worldwide Estimate of Ancillary Revenue represents a massive increase of 89% from the 2010 estimate of $22.6 billion. The CarTrawler Worldwide Estimate of Ancillary Revenue marks the fourth year IdeaWorksCompany has prepared a projection of global ancillary revenue activity, and is the first year that CarTrawler’s sponsorship of this forecast includes a series of ancillary revenue reports.
IdeaWorksCompany Creates New Master Classes Designed to Boost Revenue and Profits
Roster of presentations grows to 16 with addition of 7 sessions including a la carte products, fare families and reward management. Master Class Workshops kick-start the ancillary revenue revolution within any airline by educating and engaging all stakeholders, such as finance, sales, operations, marketing, and revenue management personnel, in a forum led by one of the industry’s leading experts.
Economy Class Meals Get an a la Carte Upgrade
Air France, Austrian, Condor, Hawaiian, KLM, and US Airways hope customers will forego free and pay for better food. This IdeaWorksCompany report describes how these airlines strive to create better comfort in the air for those willing to pay a little extra.