Allegiant Air Is 2017 Champ for Revenue Innovation Leadership
IdeaWorksCompany continues an annual tradition by identifying the airlines that have shown the greatest prowess in ancillary revenue, a la carte pricing, and loyalty marketing. This year, Las Vegas-based Allegiant Air takes the top spot. Throughout 2017, we assessed the top ancillary revenue producing airlines and the most generous frequent flyer programs; our reports described the industry’s service and product innovations; and we offered practical advice for airline executives. Along the way, a select group of airlines clearly stood apart in their quest for new sources of revenue success. These Top 5 Revenue Innovation Champs for 2017 represent the creativity of the front line employees and management teams who delivered exceptional results during the year
Airline ancillary revenue projected to be $82.2 billion worldwide in 2017
The CarTrawler global estimate forecasts 22% increase above 2016, with $57 billion of the total composed of a la carte fee activity. 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 $82.2 billion worldwide in 2017. The CarTrawler Worldwide Estimate of Ancillary Revenue represents a 264% increase from the 2010 figure of $22.6 billion, which was the first annual ancillary revenue estimate.
Click here for an infographic summary (JPG file) of key findings.
2017 Top Merchandising Innovations to Delight Passengers and Boost Profits
New report explores how airlines are creating profitable products and services, including examples from Allegiant, Delta, easyJet, Gol, Jeju Air, and Tui Netherlands. Airlines have always focused on the number of seats they sell. It’s similar to auto manufacturers’ fascination with selling cars, rather than focusing on the business of transporting people. Likewise, carriers shouldn’t focus solely on airline seats, but rather on the entire time a consumer spends away from home. Instead of claiming a small piece of this business, airlines could broaden their agendas to become complete retailers of travel.
Wyndham Rewards Offers More than Double the Payback Among Six Leading Hotel Loyalty Programs
Wyndham Rewards returns an average of 16.7% from room night spending as reward stay value in the third annual CarTrawler Hotel Reward Payback Survey. That’s 3+ points higher than the brand’s 2016 result and a 211% higher return than the reward value provided by Starwood’s SPG, which was ranked last among the six hotel loyalty programs at 5.4% for reward payback. During August 2017, IdeaWorksCompany conducted 1,350 reward queries and calculated “reward payback” for key hotel brands in six global frequent guest programs: Best Western Rewards, Hilton Honors, IHG Rewards Club, Marriott Rewards, Starwood SPG, and Wyndham Rewards.
Click here for an infographic summary (JPG file) of key findings.
Click here to view the 10-page report.
New CarTrawler Ancillary Revenue Yearbook Shows $44.6 Billion in Revenue Boosts for 66 Airlines
IdeaWorksCompany researched financial filings made by 138 airlines all over the world, discovering 66 which disclosed qualifying revenue activity. Airlines joining the list for 2017 include Azul, Eurowings, Jejuair, Jet Airways, South African, and Vietjet. Now available free online, the 110-page, 2017 Yearbook provides a detailed global review of a proven revenue source that delivers a whopping $6.2 billion for United Airlines, 39.4% of sales for Wizz Air, and $49.89 per passenger carried by Spirit Airlines.
Southwest, JetBlue Lead Average Reward Price Rankings Among Five Major US Frequent Flyer Programs
2017 CarTrawler Reward Seat Availability Survey also finds that Delta SkyMiles reward prices are 19% lower than in 2013. Low-cost carriers Southwest and JetBlue continue to offer US flyers the lowest average reward seat pricing, despite an industry shift to dollar-based rather than mileage-based loyalty points accrual. The annual rankings for the two airlines remain unchanged since 2013 when average reward seat pricing was first calculated.
Top Ten Airlines Generate as Much as 46% of Sales from Ancillary Revenue
CarTrawler-sponsored analysis shows big jump from five years ago, when the same group of airlines generated 10% to 33% from ancillary revenue. Every year IdeaWorksCompany searches for disclosures of financial results which qualify as ancillary revenue for airlines all over the globe. Annual reports, investor presentations, financial press releases, and quotes attributed to senior executives all qualify as sources in the data collection process.
Southwest is Tops in Annual Reward Rankings, But Survey Shows Fewer Reward Seats Worldwide
The 8th annual Reward Seat Availability Survey ─ now sponsored by CarTrawler ─ also finds
Alaska Airlines has best reward payback among major North American carriers. The steady improvement in airline reward seat availability since 2010 ended with the results from this year’s CarTrawler Reward Seat Availability Survey. Last year 76.6% of reward queries provided access to a saver-style reward seat; this dropped to 72.4% for 2017. The story for US-based consumers is generally positive, while frequent flyer members elsewhere in the world are seeing moderate to significant declines in reward seat availability.
You may also download this FAQ document:
FAQ for 2017 Worldwide Reward Survey
Cash is King: Revenue Now Rules Frequent Flyer Program Accrual
The four largest programs in the world now use revenue based accrual. Learn why American, Delta, Southwest, and United have embraced this new world order. The addition of mileage-earning credit cards forced the airlines to better consider the financial implications. More than 35 years later, revenue now influences every aspect of a frequent flyer program. This report assesses how frequent flyer programs have become very revenue aware in the distribution of miles, points, and rewards to their members.
Ancillary Revenue Goes Mobile: the Best Methods Used by the Top 25 Airlines
IdeaWorksCompany finds Air France, Emirates, Indigo, and Ryanair provide great mobile retailing examples. The latest report from IdeaWorksCompany applies the rise of the mobile age to the ancillary revenue revolution. IdeaWorksCompany researched the in-path booking capabilities of the mobile applications offered by the world’s largest 25 airlines. It’s a varied list which includes traditional global network airlines and eight low cost carriers.