Articles tagged “fees”

JetBlue's changes are all part of the evolution of JetBlue from a low cost carrier to one that navigates a middle ground between Spirit and Southwest, one the one hand, and American, United and Delta, on the other, all in the name of maximizing profit and pleasing Wall Street.

JetBlue's looming change in its bag-fee policy likely will create a larger controversy than when Southwest revamped its loyalty program a few years ago. JetBlue undoubtedly has run the numbers and figures it will come out ahead. It would be prudent to get the war room and phone banks ready, though.

Airlines' total global ancillary revenue, $49.9 billion in 2014, has increased each year since 2010, when total global ancillary revenue was estimated at $22.6 billion, less than half of this year's projection.

These hotel brands purport that they do not block guests' or meeting attendees' personal Wi-Fi networks, but many do require that guests are a part of their loyalty program in order to exchange email addresses for free service.

JetBlue will likely be the airline adding bag fees in 2015, not Southwest. Forsaking fees for first and second check bags is still good business for Southwest.

With global airlines slated to have a margin of around $6 per passenger in 2014, it is clear that ancillary revenue, whether it be bag fees or selling frequent flyer miles to partners, is making the difference.

High traveler demand is making hotels more comfortable charging guests for what used be included services, but both the costs and numbers of fees would quickly drop should another recession zap demand.

The JetBlue of 2015, 2016 and beyond likely won't resemble the JetBlue that we have known, but the question becomes how far with the airline take the merchandising tack that it is definitely pursuing.

Airlines are counting on demographic shifts toward younger passengers to boost ancillary sales on mobile devices.

Airlines have found a way to make a profit -- ancillary revenue -- and these fees are likely to be around for an extended period of time.