Transportation
Delta Among Most Innovative Airlines of 2014: IdeaWorksCompany
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This year has been good to airlines, with the three U.S. legacy carriers posting share price gains of at least 72% and the country’s largest low-cost carrier more than doubling. Falling fuel prices in the second-half of the year have helped, but it is those fees that have turned things around. In fact, IdeaWorksCompany, a firm that consults with airlines on ways to increase ancillary revenues, and car rental distribution firm CarTrawler estimated that ancillary revenues will reach $49.9 billion worldwide in 2014, more than double the $22.6 billion total reached in 2010.
Now IdeaWorksCompany has announced its list of the five airlines that have demonstrated “the greatest prowess in the areas of ancillary revenue, a la carte pricing, and loyalty marketing.” That is, the good ideas that have paid off the best in 2014.
Vueling Airlines, a low-cost Spanish carrier, introduced a My25% program this year that delivers a simple 25% discount to travelers who subscribe to one of its plans. For example, a three-month subscription for a 25% discount on a flight to any airport in Spain costs €99 and a three-month subscription for the discount to any destination Vueling serves costs €149. Six-month subscriptions are also available.
Delta Air Lines Co. (NYSE: DAL) is the only U.S. carrier to make the list, and that is due to the company’s decision to switch its frequent flyer program from a distance-based reward to a reward based on the price of the ticket.
Wizz Air, a Hungarian carrier, makes the list for “a continuous roll out of a la carte services and a very transparent and effective online booking process.”
Ireland-based RyanAir Holdings PLC (NASDAQ: RYAAY) gets the nod for fixing things that its customers don’t like in an effort to reduce the conflict between front-line staff and passengers.
Jeju Air is a low-cost Korean airline that makes the list for its free travel lounges that “specialize in the booking of commission-based services for travelers and operate as ‘ancillary revenue incubators.’”
IdeaWorksCompany noted that it did not have a business relationship with any company on this list in 2014.
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