Defined as “revenue beyond the sale of tickets that is generated by direct sales to passengers, or indirectly as a part of the travel experience,” ancillaries are a key channel of revenue in the industry. They help airlines remain competitive, allow for flexibility, and form a critical aspect of airline business strategy.
airBaltic, the Latvian national airline recently announced their most popular ancillary products for the first half of 2023. The airline recently celebrated a record high half-year profit, reaching 291 million EUR, a 52 per cent increase to the previous year and a 33 per cent increase from 2019.
The top three ancillaries were not particularly surprising:
- Checked baggage – Increased by 10 per cent compared to the same period last year.
- Advanced seat reservation – Increased by 24 per cent compared to the same period last year.
- Heavy hand baggage – Increased by 40 per cent compared to the same period last year.
Eva Plakane, SVP Revenue Management of airBaltic commented:
“We see a consistent demand for various ancillary products, designed to enhance passenger comfort and the whole flight experience. In the first half of this year, the total revenue from the additional products has surged by 39 per cent, compared to the same period the year before […] Overall, air travel is not anymore just a flight – it is a more in-depth engagement with customer by offering full travel experience from start to finish. Passengers want to make flying comfortable and enjoyable.”
One interesting trend is the growing number of passengers that have chosen to travel with their pets. Since 2022, the number of animals transported by the airline doubled, exceeding 6,600 animals this year.
Other notable patterns are the popularity of advanced seat reservation with over 14 per cent of passengers now opting for this feature, and a surge in demand for the transportation of special equipment (+83 per cent), pointing towards the return of passengers’ sports routines with skis, golf bags, and even surfboards needing transportation.
At World Aviation Festival, an ancillary panel featuring Plusgrade, Frontier Airlines, Vueling Airlines, and Spirit Airlines will answer the question: “How are recently emerging trends such as bleisure, intermodal, and longer stays affecting ancillary sales and do we have the products to react quickly enough?” Get your ticket now to avoid missing out.
For more on ancillaries see:
- Ancillaries and digitisation. An interview with Apple Ignacio, Director of Ancillaries, Cebu Pacific Air
- From selling ancillaries to shaping travel experiences
- When It Comes to Modern Retailing, LCCs Have a Head Start