Top Ancillary Revenue Rates Reach $52 per Passenger and $6 Billion per Airline
IdeaWorksCompany published the first ancillary revenue review of top-performing airlines back in 2008. The top ten airlines generated $8.4 billion that year. Fast forward to 2015 and the top ten tally has leapt to nearly $26 billion. Now, this group is a billion-dollar club with annual ancillary revenue ranging from just over $1 billion to $6.2 billion − which is #1 carrier United’s total. Top performer per passenger is Spirit, at $51.80 per customer; Spirit also tops the list for revenue share, at 43 percent of total sales.
Southwest and airberlin Top Reward Rankings but Turkish Airlines and Air China Rise High
The 7th annual Switchfly Reward Seat Availability Survey also finds JetBlue has best reward payback among major North American carriers. Value-oriented airlines dominate the top tiers of the 7th annual Switchfly Reward Seat Availability Survey. Two global carriers made significant improvements to their rankings. Turkish Airlines had the 4th best reward seat availability for 2016, which is much improved from its 15th place ranking in 2015. Likewise, Air China showed big improvement by moving to the 10th slot from 18th place in 2015.
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Switchfly Reward Seat Availability Survey Infographic
Aer Lingus, AirAsia, Ryanair, and Spirit Use Email to Sell After Booking
The need for ancillary revenue requires airlines to venture beyond the booking confirmation email. The latest report from IdeaWorksCompany follows that path to learn how airlines gain more sales after a booking is made. IdeaWorksCompany assessed the full set of emails sent by six top ancillary revenue airlines to learn how they encourage customers to buy more.
Aer Lingus, Pegasus, Spirit, SWISS, and WestJet Provide Excellent Online Examples of a la Carte Promotion
Shopkeepers know the best store layout balances an efficient shopping experience with the placement of subtle detours that cause consumers to consider buying more. Retail methods can fill airline shopping carts too; airline websites can easily apply these practices to booking path design. This requires airline executives to think like retailers and to create websites that go beyond enabling simple transactions to becoming destinations that engage and excite consumers. The latest report from IdeaWorksCompany reviewed the websites of airlines all over the world and details good practices regarding booking paths ─ and also what airlines should avoid
Air Canada, easyJet, Jetstar, LOT Polish, and United Among Airlines Using Non-Traditional Loyalty Methods
Loyalty is increased through a wide array of methods. To be exact, IdeaWorksCompany identifies six additional loyalty platforms beyond a traditional frequent flier program. Some may operate as replacements for traditional FFPs and others work to increase the loyalty of customers through a combination of rewards and recognition. The latest report issued by IdeaWorksCompany describes the many loyalty choices available, such as coalition programs, subscription plans, and credit-card based rewards.
Delta Air Lines Is 2015 Champ for Revenue Innovation and Marketing Leadership
IdeaWorksCompany continues a year-end tradition by identifying the airlines that have shown the greatest prowess in the areas of ancillary revenue, a la carte pricing, and loyalty marketing. Throughout 2015, we assessed the top ancillary revenue producing airlines and the most generous frequent flier programs, and issued reports that described the industry’s service innovation and product development; and offered practical advice for airline executives.
IdeaWorksCompany boycotts Trump
Presidential candidate Donald Trump called for a “total ban” of Muslims entering the United States at a campaign rally yesterday. In prior comments he has suggested creating a database to monitor Muslim Americans and proposed warrantless searches of their homes. His statements have gone far beyond normal political discourse and represent overt bigotry and xenophobia. Donald Trump has placed hatred and fear in the forefront of his political campaign.
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.
Airlines Want to Become the Amazon.com of Travel
The forever quotable Michael O’Leary, CEO of Ryanair, motivated his competitors when he recently said, “We want to become the Amazon.com of travel in Europe, with a whole load of additional services: price comparison, cut-rate hotels, discounted football tickets, concert tickets.” It’s a sentence that instantly conveys why airline executives are eager to learn more about airline merchandising. 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