Airlines ’Round the World Embrace the Need for Change in the Ancillary Revenue Services They Create
The internet has furthered the evolution of retail by determining which companies perish, survive, or thrive. It’s a story that parallels much of what has happened in the airline business. The common theme is this: Companies that embrace change enjoy a better chance of success. Those clinging to the past risk others taking their place. The latest report by IdeaWorksCompany examines the changes occurring in merchandising, what lessons can be applied to the travel business, and how airlines are becoming better ancillary revenue retailers.
Women Leaders Boost Ancillary Revenue Profits at Alaska Airlines, Finnair, Jetstar, and WOW air
Ancillary revenue has become a universal benefit for all successful airlines, from global network giants to low cost carriers, because it provides protection against the unpredictability of airline fares and the risk of rising fuel costs. The four ancillary revenue leaders presented in this report, along with the four airlines, demonstrate what occurs when people are selected and promoted on the basis of their ability, passion, and results
Top Ten Airlines Generated $29.7 Billion from Ancillary Revenue in 2017
CarTrawler-sponsored analysis shows ancillary revenue has gone beyond tilting the bottom line toward profitability and is now a core component of revenue for fiscally healthy airlines. 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. These results are contained in the new report, 2017 Top 10 Airline Ancillary Revenue Rankings.
American and Turkish Airlines Show Dramatic Increase in Reward Seat Availability with Southwest Staying on Top
The 9th annual Reward Seat Availability Survey ─ sponsored by CarTrawler ─ also finds survey newcomers Norwegian and China Eastern ranked in the top 8 among 25 airlines. The CarTrawler Reward Seat Availability Survey answers the question, “How easy is redemption for the basic and most popular reward type offered by the world’s top airlines?” The 25 carriers in the survey remained almost the same as 2017, with China Eastern, Norwegian, and WestJet as newcomers for 2018.
Click here for 2018 Worldwide Reward Survey FAQs.
Click here for infographic summary (JPG file) of key findings.
Key Mobile App Features for Top 15 Low Cost Carriers: Assigned Seating, Trip Protection, and Pre-Pay Baggage
IdeaWorksCompany finds Norwegian, Pegasus, Ryanair, and Wizz Air provide great mobile retailing examples. The latest report from IdeaWorksCompany reviews the mobile applications offered by the world’s largest LCCs as measured by passengers flown. After all, the LCC category should naturally excel in the art of ancillary revenue.
European Airlines Lead 2017 a la Carte Revenue Estimate at $19.4 Billion with Asian Carriers 2nd at $15.8 Billion
The CarTrawler Global Statistics of a la Carte Revenue provides regional details, comparisons to 2010 revenue numbers, and a first-ever baggage revenue estimate. 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. Of these, the revenue from checked baggage looms large with $23.6 billion in estimated sales for 2017.
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.