Airline Ancillary Revenue Projected at $59.2B

IdeaWorksCompany, a consultancy on airline ancillary revenues, and CarTrawler, an online global car rental platform, project airline ancillary revenue will reach $59.2 billion worldwide in 2015.

This forecast is an 18.8% increase from 2014, according to “The CarTrawler Worldwide Estimate of Ancillary Revenue.” And it’s an increase of 163% from the 2010 figure of $22.6 billion — the first year of the ancillary revenue estimate.

For 2015, a list of 180 airlines provided a global projection of ancillary revenue worldwide. This is the sixth year of the “CarTrawler Worldwide Estimate of Ancillary Revenue.”

“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, CarTrawler’s chief commercial officer. “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 — including on-board 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, according to the report.

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 travelers, such as hotel accommodations and car rentals.

Click here to view the full report.