
The last year hasn’t been good for business travel. Steep declines domestically and internationally have had a substantial impact on airlines all over the world. So, how do airlines make up for the dip in business travelers? They find more ways to charge leisure travelers, of course.
As airlines review their quarterly performance, we can expect them to start exploring new ways to make up for the continuing dip in business travel/revenue. Checked bag fees and a la carte pricing for food (and even for blankets in some cases) have helped carriers create new revenue streams, but it doesn’t look like it will stop there.
Southwest Airlines has held out on bag fees, and even made that a major marketing point, but that doesn’t mean they’re not looking for other ways to bring in money from travelers…(keep reading)
“‘There are substantial ancillary revenue opportunities besides bag fees that we are continuing to pursue,’ said Gary Kelly, Southwest’s chairman, president, and CEO…’We would much prefer to explore opportunities to provide more service to customers and give them the choice to spend more money with Southwest Airlines…Our frequent-flier program and Southwest.com both position us well to pursue that strategy.’” (from Memphis Daily News)
Kelly goes on to say, “there’s no reason to believe business travel will return anytime soon to help bail us out.”
Southwest will not be the only airline looking for new ways to encourage passengers to spend. We’ve already seen new tactics like United Airlines’ Premier Baggage plan and JetBlue’s All-You-Can-Jet option. If business travel stays stagnant and airlines slowly run out of things to charge us for that used to be free, it will be interesting to see what new services arise and what kind of fees those services bring with them.