Brazilians Stuff Suitcases in Last Free Perk for Fliers
In other parts of the world, airlines are getting even stricter about luggage, from carry-ons to suitcases bound for the cargo hold. That means planes flying outside Brazil are lighter and more fuel-efficient, said Jay Sorensen, a former Midwest Airlines executive who now runs aviation consultancy IdeaWorksCompany.com in Shorewood, Wisconsin. In Brazil, “they’re messing with the economics of airlines,” Sorensen said in a telephone interview. Brazil risks bankrupting its airlines by dictating what they can charge for, he said.
Financial Review of Australia
Qantas frequent flyer changes ‘bewildering’ for customers
Qantas Airways may have marketed recent changes to its frequent flyer program as “simpler and fairer”, but in reality the airline added “daunting complexity” to its loyalty scheme, according to a new report from US consulting firm IdeaWorksCompany.
Financial Post of Australia
Airlines go à la carte: Why travellers should get used to baggage fees and more ‘unbundling’
“We predict that the inclusion of free baggage as a benefit of a fare will disappear worldwide over the course of the next few years,” said Jay Sorensen, president of IdeaWorksCompany, a Wisconsin-based consulting firm that helps airlines generate more revenue through ancillary fees. According to research by IdeaWorksCompany, global airline ancillary revenue soared nearly 1,200% between 2007 and 2013 as more carriers embraced the concept of “unbundling,” or charging separately for a variety of services.
Revenue-Based Accrual as the New World Order
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. For many fliers, gone forever as of 01 January 2015 is the notion an economy class fare accrues miles on the basis of distance flown. Instead, the almighty US dollar will determine the miles posted to member accounts. “Revenue-Based Accrual as the New World Order” was released today as a free 15-page report and is available at the link above. The 2014 Loyalty Marketing Report series is sponsored by Switchfly, a global technology company that powers travel commerce and loyalty redemption solutions for leading travel, financial services and ecommerce brands.
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.
Selling those little extras pushes Jetstar into top 10
THE Jetstar Group has emerged among the top 10 airlines in the world when it comes to the percentage of its revenue derived from selling extras to passengers. Jetstar made about a fifth of its revenue by selling extras, such as checked baggage, in-flight entertainment and meals, in fiscal 2013, according to a survey from US-based IdeaWorksCompany.
Airline Profits Are Up, Thanks To Everything But Airfares
“Without ancillary revenue, the airline industry would be at a loss overall,” says Jay Sorensen, president of IdeaWorks, the Shorewood, Wis.-based consulting group which tracks ancillary revenue.
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.
2014 CarTrawler Yearbook of Ancillary Revenue by IdeaWorksCompany
The 2014 CarTrawler Yearbook of Ancillary Revenue by IdeaWorksCompany, now available free online, provides the most detailed global assessment of a bottom-line-booster that can represent more than 38 percent of a carrier’s revenue. The full 85-page report examines 59 airlines that disclosed revenue in financial filings during 2013 from activities such as frequent flier miles sold to partners, fees for checked bags, and commissions from car rentals.
How budget airlines REALLY make their money: Jet2 and Wizz Air rely on optional extras MORE than Ryanair, with only 65% of their income coming from ticket price
The world’s top airlines collected more than £31.5billion in extra charges in 2013, an increase of more than £4billion on the previous year. Some airlines are making up to 40 per cent of their money from charging for extras like seat allocation, checking in luggage and food and drink on flights, according to a report by consultancy IdeaWorksCompany.