45% of airlines are missing out on the full ancillary revenue and digital merchandising potential

(June 6th, 2018)

Most airlines still struggle with digital merchandising shows latest Diggintravel research. During the first quarter of 2018, Diggitravel reached out to more than 110 airlines senior ancillary, digital and other executives. As a result, 38 airlines participated in the final survey which evaluated airlines digital merchandising maturity.

 

Iztok Franko, airline digital consultant and founder of Diggintravel shared the following views:

“Increased ancillary revenue is on every airline agenda. However a lot of airlines are still trying to develop digital retailing capabilities needed to take maximize it. Our research shows that 17 airlines (45%) were classified as Laggards, thus missing out on the full ancillary revenue and digital merchandising potential. On the other hand ancillary revenue represents more than 27% of total revenue for the Leaders. With our research we tried to identify what Leaders do better than the rest in each area of the digital merchandising.”

 

What and how was evaluated:

The goal of the survey was to evaluate digital merchandising maturity within airline organizations. For evaluation of maturity research was structured around five main areas:

  • Product and Pricing
  • Innovation and Technology
  • Digital Merchandising Techniques
  • Customer Centricity
  • Organizations and Integration

In addition to the survey, Diggintravel performed a digital audit of booking platforms for all 38 participating airlines, evaluating various merchandising elements such as presentation of branded fares / fare families, upsell mechanics, a la carte ancillary product offering and usage of persuasion methods.

The white paper represents the views and insights of 38 carriers, providing intriguing insights into the state of digital merchandising for the airline industry.

Full 87-page white paper is available for download on the Diggintravel website.