IdeaWorksCompany identifies the ancillary revenue methods of 10 brave pandemic-era startups in Africa, Asia, Europe, and the US.
DUBLIN, IRELAND & SHOREWOOD, WISCONSIN – New airlines compete by identifying customers who are not well served by larger and established carriers. This is the secret to surviving as a start-up airline: find an underserved market and apply all the youthful passion and nimble moves you can muster. That’s how these 10 low cost carriers hope to flourish in a post-pandemic era: Air Premia, Akasa Air, Avelo Airlines, Breeze Airways, Flyr, LIFT, Lynx Air, Norse, PLAY, and Vietravel Airlines.
All operate as low cost carriers, as this is the prevailing model of today’s airline industry. Ancillary revenue is at the core of this movement because it honors customer choice and delivers the amazing alchemy of low fares and more revenue. World's Newest Airlines
Embrace Ancillary Revenue at First Flight is sponsored by global travel tech provider CarTrawler and reviews the ancillary revenue efforts of ten airlines that leapt through challenging hurdles during the pandemic. The 13-page report includes the following key findings:
- All 10 new entrants have not included lie-flat seating in a defined business class cabin as earlier new entrants have done.
- LIFT of South Africa removes the sharpest edges from traditional change and cancellation policies by allowing plenty of flexibility 24 hours prior to departure.
- Norse in Europe follows the branded fare method with a “good, better, and best” menu that typically encourages 50% of consumers to buy up to a higher fare.
- PLAY of Iceland had baggage revenue of $27 per passenger for the 2nd quarter of 2022, which was 15% of passenger revenue.
- Breeze in the US offers great graphic design in the presentation of pre-assigned seats, which includes 36 first class seats on its Airbus 220 aircraft.
“It’s clear that ancillary revenue is a key revenue driver for airlines. Equally so is being able to pivot and innovate if needed,” said Aileen McCormack, CarTrawler Chief Commercial Officer. “This report outlining the products new low-cost airlines are developing and rolling out shows how this innovation is paying off, with impressive results such as branded fares encouraging 50% of passengers to buy up for more services, and substantial baggage revenue from better retail efforts. We’re proud to help our airline partners maximise their ancillary revenue with our world-class travel technology and keen to see what exciting new products are coming down the pipeline."