My love letter to the airline industry during this time of trouble.
Jay Sorensen’s letter to the global airline community: for those at the ticket counter, at the gate, on the plane, on the ramp, in the hangar, and at corporate headquarters.
European Airlines Lead a la Carte Revenue Estimate at $31.5 Billion with Asian Carriers 2nd at $21.1 Billion
The birthplace of airline a la carte revenue—Europe—continues to lead the globe in annual growth for this key sales component. And the world’s fastest-growing air travel market, Asia, is not far behind. IdeaWorksCompany, the foremost consultancy on airline ancillary revenues, and CarTrawler, the leading technology platform providing end to end transport solutions for online businesses, recently estimated airline a la carte revenue at $75.6 billion worldwide for 2019. The CarTrawler Global Statistics of a la Carte Revenue adds regional details and 2015 comparisons to the figures from the earlier November 2019 release.
Airline Ancillary Revenue Projected to Leap to $109.5 Billion Worldwide in 2019
IdeaWorksCompany, the foremost consultant on ancillary revenue, and CarTrawler, the leading provider of online car rental distribution systems, project airline ancillary revenue will reach $109.5 billion worldwide in 2019, compared to $92.9 billion in 2018. The CarTrawler Worldwide Estimate of Ancillary Revenue represents an almost fivefold increase from the 2010 figure of $22.6 billion, which was the first annual ancillary revenue estimate.
Click here for CarTrawler Ancillary Revenue Estimate 2019 Graphic (JPG file)
Finding the Path to Fix Airline Retail
It’s hard to believe we are nearing the 24th anniversary of airline websites – Alaska Airlines sold the first air travel ticket online in December 1995. Fast forward to today, airline websites still promote two core functions: transactions and information retrieval. At present, airline websites are little more than cash registers surrounded by shelves of merchandise. This report encourages airlines to move from a transaction focus to become robust retailers of travel.
A podcast of this report has been recorded, and is available at Spotify and Google Podcasts. Click this link to listen on Spotify.
2018 Top 10 Airline Ancillary Revenue Rankings
CarTrawler-sponsored analysis shows ancillary revenue continues steady advance by every measure, and asks the question, can too much of a good thing be a bad thing? 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. Of the nearly 150 airlines reviewed, 70+ reveal figures related to ancillary revenue.
British Airways Greatly Boosts Reward Seat Availability, and Entire Industry Shows Dramatic Improvement
The 10th annual Reward Seat Availability Survey finds Southwest, JetBlue, Etihad Airways and Turkish Airlines atop the rankings. The IdeaWorksCompany Reward Seat Availability Survey answers the question, “How easy is redemption for the most popular basic reward type offered by the world’s top airlines?” This year’s survey assesses 20 top airlines, with Etihad, Qatar, and Singapore as newcomers for 2019. The net result is better reward seat availability for 2019 compared to 2018. Of the frequent flyer programs surveyed this year, 13 provided better overall reward availability for 2019, with only three programs showing decreased availability.
Click here for 2019 Worldwide Reward Survey FAQs.
IKEA Teaches Everything You Need to Know About Airline Retail
CarTrawler-sponsored report shows IKEA’s merchandising methods are also used by
AirAsia, Air New Zealand, Allegiant, easyJet, Ryanair, and Scoot. IKEA is not an airline, but it is one of the world’s master retailers. The company’s relationship with customers doesn’t depend on pushing transactions. Instead the company seeks to offer “products at prices so low that as many people as possible will be able to afford them.” It has become a global success because it first seeks to meet customer needs. IKEA Teaches Everything You Need to Know About Airline Retail was released today as a free 15-page report sponsored by CarTrawler.
Global Baggage Fee Revenue Jumps to $28.1 Billion
CarTrawler Global Estimate of Baggage Fee Revenue reveals 110% increase from 2014 estimate of $13.4 billion. IdeaWorksCompany, the foremost consultancy on airline ancillary revenues, and CarTrawler, the leading technology platform providing transport solutions for online businesses, recently estimated ancillary revenue at $92.9 billion worldwide for 2018. This CarTrawler Global Estimate of Baggage Fee Revenue identifies baggage as a $28.1 billion component and provides a worldwide summary of baggage fee policies for 20 top airlines.
Allegiant Flies Its Own Route to Revenue Success
IdeaWorksCompany started tracking ancillary revenue in 2007 and Allegiant has reliably been among the best performers when measured as a percent of revenue or on a per-passenger basis. This success has been attained through a rigorous approach to a la carte sales and travel-related packaging. This CarTrawler-sponsored report describes how Allegiant is mastering the art of a la carte and seeks to capture even more of a consumer’s leisure and entertainment spending
European Airlines Lead 2018 a la Carte Revenue Estimate at $22.5 Billion with Asian Carriers 2nd at $18.8 Billion
IdeaWorksCompany, the foremost consultancy on airline ancillary revenues, and CarTrawler, the leading technology platform providing full end to end transport solutions for online businesses, recently estimated airline a la carte revenue at $65 billion worldwide for 2018. The CarTrawler Global Statistics of a la Carte Revenue adds regional details and 2014 comparisons to the figures from the earlier November 2018 release. A la carte activity is a significant component of ancillary revenue and consists of the amenities consumers can add to their air travel experience. These include fees paid for checked baggage, assigned seats, buy-on-board meals, early boarding, and onboard entertainment.