Can airlines count on the subscription model?

 

29th April, 2019 

Subscription economy in general has made rapid strides over the years. Learning from the same, the travel sector, including airlines, too, is seeking ways to meet the expectations of travellers, largely set by the likes of Amazon, Netflix etc.

Mexican low-cost carrier Volaris’ decision to embrace the subscription model, v.pass, is one such move.

“We don’t talk of being Amazon of travel, rather our aim is higher,” says Felipe Ocáriz, Head of Revenue Development, Volaris. The vision: Volaris will become the Spotify of aviation. Why? “Because Amazon focuses on transactions. In case of Spotify, the focus is on experience. Volaris should become the only choice for flying and destinations,” said Ocáriz Arce, during the Ancillary Merchandising Conference held in London earlier this month.

Be it for the idea to the development process to managing a subscription product, its technical complexity and above all, ensuring the passenger experience isn’t diluted, the airline asserts it is making progress. It is counting on possible benefits – thriving on data of members, stepping up the ancillary revenue generation, combatting customer acquisition cost and competition.

v.pass - from being a concept to being a core proposition within Volaris’ product stable – has made tremendous progress in under a year, shared Jonathan Newman, Chief Commercial Officer, caravelo, a Barcelona-based travel technology specialist. The team is working with Volaris on this project. “The number of consumers that are using/ subscribing the product are growing 20% on monthly basis,” mentioned Newman

.

 

Editorials

  • Ai Editorial: Payments - a fascinating discipline to follow in 2020 +

    21st January, 2020 Ai Editorial: Travel merchants are prioritising speed, trust and security when it comes to the payments-related experience. This, along with balancing CX and fraud prevention, and responding to Read More
  • Ai Editorial: Establishing a proactive data protection mechanism +

    17th January, 2020 Ai Editorial: Data security and privacy-related initiatives are now a priority, and travel merchants have to embrace proactive and appropriate tools for the entire organization, writes Ai’s Read More
  • Ai Video: Banking on exclusivity and experiential benefits for loyalty +

    14th January, 2020 Exclusive rewards, personalized access, a distinguished experience... such initiatives, as indicated by studies, are driving customer loyalty. It is vital for airlines to focus on the human Read More
  • 1
  • 2
  • 3
  • 4
  • 5