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
Rankings for Frequent Flier Programs: How Airlines Fared
“The programs at the top are younger programs,” says Jay Sorensen, president of loyalty consulting firm IdeaWorksCompany, which sponsors an annual survey on award availability. “They don’t have these big huge overhanging liabilities of miles or points that have been accrued through credit-card activity. There isn’t this huge pile of points they’re trying to get off the books, where you have too many miles chasing too few reward seats.”
United Plans to Award Miles Based on Fare, Not Distance
United announced Tuesday that starting March 1, 2015, it will revamp its MileagePlus program to award fliers based on total ticket price, rather than miles flown. Regular travelers will earn five times their fare; elites will earn seven to 11 times the fare, depending on their tier. . . Given that United hasn’t announced any changes on its redemption side, where a round-trip domestic ticket costs 25,000 miles, many travelers will be that much further from redemption. “Clearly the programs are being redesigned to favor high-yield passengers,” said Jay Sorensen, president of IdeaWorksCompany, a frequent flier research firm.
Global aviation leaders jet into Doha for key summit
According to US-based aviation research company IdeaWorksCompany, the second major structural change in airline performance over the years has been the emergence of ancillary businesses. Based on data from IdeaWorksCompany, the average ancillary revenue per passenger could exceed $13 this year from zero in 2007.
Frequent flier smiles: It’s easier to redeem miles
The annual Switchfly Reward Seat Availability Survey, which gauges the frequent flier programs at 25 of the world’s largest airlines, found seats were available for frequent flier redemption on 72.4 percent of the flights checked. That’s a very slight increase compared with the prior year. “I was surprised by this year’s results,” said Jay Sorensen, president of IdeaWorksCompany consulting firm, which surveyed 7,640 flights in March. “Typically, when you see the industry recovering from financial duress, one of the things they cut back on is giving away free seats.”
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
What’s next for airline fees? More ways to pay
Although the latest numbers may show a slight decline in how much passengers are paying airlines to check their bags, the long- term trend is clearly heading in the other direction. “They’re going to go up,” predicted Jay Sorensen, the president of IdeaWorks, a research firm that advises the industry. “The airlines are always testing higher rates to see if it will fly.”
Top 10 Things You Need to Know about Ancillary Revenue
After 10 years, a new business model has transformed the world’s biggest industry. 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. The report identifies many key elements of this phenomenon, including: baggage charges, branded fares, subscription programs, high value customers, transparent pricing, and frequent flier program revenue.
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.