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Ancillary Revenues

In: Airline Revenue Management

Author

Listed:
  • Curt Cramer
  • Andreas Thams

    (University of Applied Sciences Worms)

Abstract

The global market share of low-cost carriers offering no-frills products to their customers with the opportunity to book additional product and service components has been growing from 15.7% in 2006 to 31% in 2019. This shows the constantly growing relevance of low-cost carriers from both a demand and supply side, while airlines with traditional business models keep losing market shares and partially adopt certain components of low-cost carriers, particularly in the field of additionally bookable product and service components. A recent survey among the U.S. American customers in 2019 revealed that for 57% the ticket price is a crucial aspect when buying an airline ticket for personal travel, which makes price the most important criterion when choosing a flight. For decades, we can observe an overall negative price trend in the market despite various attempts of airlines to raise prices. The average return airfare before surcharges and taxes in 2017 was estimated at $351, which was 63% below 1995 levels, while the global airline market kept growing until 2019.

Suggested Citation

  • Curt Cramer & Andreas Thams, 2021. "Ancillary Revenues," Springer Books, in: Airline Revenue Management, chapter 6, pages 61-69, Springer.
    • Handle: RePEc:spr:sprchp:978-3-658-33721-6_6
    DOI: 10.1007/978-3-658-33721-6_6
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