Airline ancillary revenue projected to be $59.2 billion worldwide in 2015

Airline ancillary revenue projected to be $59.2 billion worldwide in 2015

DUBLIN — Airline ancillary revenue will reach US$59.2 billion worldwide in 2015, according to IdeaWorksCompany, a consultancy on airline ancillary revenues, and CarTrawler, an online car rental and ground transportation platform.

The CarTrawler Worldwide Estimate of Ancillary Revenue represents an increase of 163% from the 2010 figure of $22.6 billion, which was the first year for the ancillary revenue estimate.

Earlier this year, CarTrawler and IdeaWorksCompany reported the ancillary revenue disclosed by 63 airlines for 2014. These statistics were applied to a larger list of 180 airlines to provide a truly global projection of ancillary revenue activity by the world’s airlines in 2015.

The CarTrawler Worldwide Estimate of Ancillary Revenue marks the sixth year IdeaWorksCompany has prepared a projection of global ancillary revenue activity.

“These figures show the impact that ancillary revenue has on the bottom lines of airlines, but it is also a critically important element of the customer experience,” says Michael Cunningham, Chief Commercial Officer at CarTrawler. “Airlines that offer a rounded, sophisticated customer experience by drawing on data science insights and the right ancillary offerings have a better chance of backing up revenues with increased loyalty and a stronger brand promise, which in turn leads to increased repeat bookings.”

Revenue from optional services, such as onboard sales of food and beverages, checked baggage, premium seat assignments and early boarding benefits, was determined to represent $36.7 billion of the projected global 2015 total. The smaller share, at $22.5 billion, comes from non-fee activity such as the sale of frequent flier miles to program partners, and commissions earned on the sale of services to travellers, such as hotel accommodations and car rentals.