Chances are it’s been a long time since an airline fee outraged or surprised you. As baggage fees celebrate their fifth birthday, more and more travelers have come to accept them – and that’s just the way the airlines want it.
According to a report from PhoCusWright, a travel industry research firm, when airlines began charging for checked bags and bigger seats in 2008, passengers did not respond well. The likelihood that fees would amount to any money wasn’t promising. But in just five years that’s all changed.
Checking your bag, picking a seat, getting on the plane first, getting off the plane first, having a few extra inches of legroom, changing your reservation, using Wi-Fi, watching movies, buying food – all things that airlines have found they can charge for and that more and more people are willing to pay for. As fees become standard, the number of people willing to purchase extra services continues to rise.
According to the PhoCusWright report, the percentage of people purchasing everything from priority boarding to airport lounge access has risen exponentially in the last two years.
In 2010, just 28% of travelers bought an in-flight snack, while 40% did in 2012. Only 14% paid for extra legroom or preferred seating two years ago, but 24% paid last year. Airport lounge access was something only 9% of people felt the need to purchase in 2010, but 17% paid for access in 2012.
Partially, airlines finally realized they had a captive audience without a lot of options (at the same time that airports and airplanes became more crowded and cramped). The purchase of extras is highest among heavy travelers. If you need to bring more than a certain amount of clothes with you, what are your choices besides checking a bag? If you’re on a flight where free meals used to be standard, where else can you get food besides buying it from the airline? Airlines also got better at upselling and pushing perks throughout the ticket purchasing and check-in process, according to the report.
Also, people have forgotten or never knew a time when fees weren’t the norm. Almost half (46%) of U.S. travelers between the ages of 18 and 34 purchased an in-flight meal or snack, while just 29% of flyers over 55 did. That holds true across all categories of purchase. The young don’t remember the better days.
It all amounts to a whole lot of money. According to the Bureau of Transportation Statistics, in 2012, U.S. airlines collected $6.1 billion in baggage and reservation-change fees. It turns out airlines also made a profit of just about $6 billion last year. That means the business isn’t in flying people; it’s in getting them on a plane and selling them stuff.