I only came across Dennis Schaal’s blog recently, but it is currently sitting near the top of my RSS feeds. In a recent post he references a New York Times article titled Some Elite Customers May Start to Feel Ordinary. I’ve lifted a couple of interesting quotes from the article.
“But the question a lot of business travelers now have is whether there will be value in maintaining a low level of elite status if the airlines are selling off elite amenities like that aisle exit-row seat – especially as the system shrinks and choices narrow for everyone.”
“Assume you’re an elite-status flier who is willing to pay that extra $15 for the choice seat. Will you get first crack at it in the future? Or, given the slice-and-dice technology being developed on booking sites, will an auction of sorts ensue, with the choice seat going to someone willing to pay, say, $22.50? Do I hear $25?”
The first quote makes a good point about not losing sight of the bigger picture when unbundling fares. The second quote touches on something I have been pondering for quite some time, because online auction sites seems to have an addictive quality as people return to see if they have been outbid. Airlines looking at building a social network should take this as a big hint.
Finally, I saw a press release from Janet Titterton on airlines increasing ancillary revenue. Janet has a tough job coming up, as she is going head to head with a good client of mine on day two of an upcoming industry conference. My client is currrently billed as “Mystery Airline” given that I am working with them on implementing an a la carte pricing strategy, but for the time being the name of this man and his airline remain under wraps.
The global airline industry has the potential to generate additional ancillary revenue activity, a study has shown. Insight by Collinson Latitude… has revealed that airlines can make at least an extra $6 per passenger by offering services above and beyond ticket sales.