"Recognise that ancillary revenue is important to an airline's prosperity"
Published: 21 Aug 2008
Ancillary Revenue in Travel Special
Maximising your ancillary return is not just about commissions, products or technology but also your ancillary strategy which should now be at the core of any airlines' business.
This viewpoint came from Steven Greenway, Chief Commercial Officer, SkyEurope Airlines during one of EyeforTravel's events (Ancillary Revenue in Travel 2008 conference held in Dublin) earlier this year.
Referring to the retailer vs. flight supplier issue, Greenway said "We all now want to extract the "overall value" of the guest." This means flight, change fee, insurance, parking, car hire, hotel, baggage, seat selection, city guides, currency conversion etc.
But in terms of problem in this arena, he said, "Too often we focus on what is the "next big product" or who has got the best deal, or even what leading edge technology should be adopted?."
Reflecting on current approach towards ancillary revenue, Greenway said the ancillary ownership is fragmented, terming it as the old "silos" problem. According to him, there is no end-to-end thinking on how ancillary products can be implemented.
Recommending a strategy in the context of ancillary ownership being fragmented, Greenway said, "Recognise that ancillary revenue is important to an airline's prosperity. Centralise all ancillary activities under one senior manager and work with various divisions to deliver on clear KPI's/revenue targets."
On the other aspects of a successful ancillary strategy, apart from stating that all ancillary activities need to be centralised under one owner who is a senior manager, he referred to following:
· RM should not only manage routes by yield/SLF but also ancillary contribution
· The Super PNR needs to become a reality
· Airlines and ancillary providers need to work as partners
· Ancillary products need to be dynamically tailored to a customers circumstances and/or a route-by-route basis
· Ancillary capability must be channel agnostic
· Think end-to-end to maximise ancillary opportunities
From RM perspective, he said revenue management systems should be capable of integrating data and there should be a collected effort to offset distressed inventory.
Ritesh Gupta
EFT Team
Ancillary Revenue in Travel 2008, Las Vegas
EyeforTravel is scheduled to conduct Ancillary Revenue in Travel 2008 Conference as part of the Travel Distribution Summit North America. The conference will be held on 1-2 October in Las Vegas.
For more information, click here:
http://events.eyefortravel.com/tdsusa/ancillary/agenda.asp
or contact:
Helen Raff,
VP North America
Email: helen@eyefortravel.com
Tel: +44 (0) 207 375 7582 – UK
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