Airlines calculate their profits by carefully considering a range of factors including; how much it costs to operate an airplane, how many seats will be filled, and how much revenue each sold ticket will generate. For a long time, it seemed as though the only way for airlines to turn a profit was to decrease its own costs and increase fares as well as the number of passengers on each flight. However, airlines have recently uncovered other ways to generate additional revenue.
If you are planning to pursue a career in travel and hospitality, read on to learn how airlines have been increasing their revenues without increasing their costs.
New Fees for Travellers
From January to March, airlines in the US generated an additional 1.6$ billion from something that did not exist until about 2008: baggage fees. Some airlines are now routinely charging between 25$ and 200$ for checked baggage. These fees are typically determined based on the number of bags a traveller has as well as the weight of each luggage.
Baggage fees are not the only extra charges that airlines are piling on. In fact, certain companies have added other fees, turning features that were once free into paid options. Some of these include:
- reservation change fees
- carry-on baggage fees
- preferred seating fees
- mobile booking fees
Beverages, snacks, pillows and ear buds are among other comfort features that cost extra these days.
Low cost carriers, like Spirit and Ryanair, are some of the biggest offenders where extra fees are concerned. These companies have earned the reputation of advertising cheap flights and tacking on so many additional fees that customers are left wondering if they actually saved any money at all.
How Customers React to Flight Fees
While some customers appreciate the reduced prices offered by discount flyers, there has been some backlash against many new airline fees. For instance, Ryanair famously considered charging customers to use the washroom. It is no surprise that this demand was met with fury from customers, and it also helped solidify the airline’s reputation for having poor customer service.
While customers often consider ticket prices when they budget for their vacations, they also appreciate good customer service from travel and tourism professionals. Students pursuing flight attendant careers will develop excellent communication skills during their training. This will ensure that they provide travellers with the best customer service once they break into the field.
The Future of Airline Customer Service
Due to pressure from its customers, Ryanair has announced that it will remove its unpopular airport check-in fee, which is charged to travellers who do not check-in online.
Other airlines have responded to customer demands by bundling fees into tiered packages. For example, American Airlines now offers its customers a range of pre-established package options, such as Choice, Choice Essentials, Choice Plus, and Fully Flexible.
Of course, not every airline charges additional or hidden fees. Certain companies have begun using their lack of extra fees as a marketing strategy, knowing that this approach will likely attract potential customers. Southwest Airlines, for example, has begun using the slogan “bags fly free” as their new company motto.