Visit the websites of leading airline retailers today and you will see a robust display of various pricing methods. Consumers encounter branded fares, service bundles, subscription plans with prices that are fixed, flexible, or dynamic.
DUBLI, IRELAND – The forever quotable Michael O’Leary, CEO of Ryanair, motivated his competitors when he recently said, “We want to become the Amazon.com of travel in Europe, with a whole load of additional services: price comparison, cut-rate hotels, discounted football tickets, concert tickets.” It’s a sentence that instantly conveys why airline executives are eager to learn more about the next level of airline merchandising.
Visit the websites of leading airline retailers today and you will see a robust display of various pricing methods. Consumers encounter branded fares, service bundles, subscription plans with prices that are fixed, flexible, or dynamic. Someday they will also encounter pricing which is aimed at them as individual consumers. The latest report, sponsored by CarTrawler and issued by IdeaWorksCompany, is designed to prepare industry professionals for the decision-making required to take merchandising to the next level with examples from the world of airline retail:
- JetBlue in the US implemented a branded fare strategy in 2015 and expects it to produce annual revenue gains of $200 million.
- Jetstar of Australia doesn’t have branded fares, but uses a similar approach that’s simply called service bundling.
- Volaris of Mexico operates a fare discount subscription program that generated annual membership fees of $3.5 million for the airline in 2014 in addition to the sale of tickets.
- United’s use of dynamic pricing for Economy Plus extra leg room seating boosted year over year revenue by 16% per seat.
- Ryanair has hired 200 IT staff to remake its website to better compete with the likes of Skyscanner.com and Google Flights.
Manual for Merchandising-Airlines Want to Become the Amazon.com of Travel
Vicky is the co-founder of TravelDailyNews Media Network where she is the Editor-in Chief. She is also responsible for the daily operation and the financial policy. She holds a Bachelor's degree in Tourism Business Administration from the Technical University of Athens and a Master in Business Administration (MBA) from the University of Wales.
She has many years of both academic and industrial experience within the travel industry. She has written/edited numerous articles in various tourism magazines.
