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American Airlines Is Once Again Changing How Fliers Can Earn Rewards

April 23, 2024

Wall Street Journal

The lowest-priced reward flight with American on average was 25% cheaper in 2024 compared with five years earlier, according to airline-consulting firm IdeaWorks. Comparatively, the price of a rewards flight, in miles or points, across all of the carriers studied rose 28% on average since 2019. The IdeaWorks analysis was based on 600 flight inquiries conducted in March for travel between June and October. The queries searched for the lowest-price fares for certain routes across six carriers: American, United Airlines, Delta, Southwest Airlines, JetBlue and Alaska Airlines.

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There is a reason it’s costing more travel miles to get the same flight

April 5, 2024

The Street

If you recently tried to book a flight with points or frequent-flyer miles, you might have noticed that not only cash prices have jumped significantly. The “they want how much for that flight?” feeling is confirmed by data — IdeaWorksCompany, a consulting firm analyzing airline revenue, calculated that the average price of a plane ticket purchased with miles rose by 28% between 2019 and 2024, or 7% more than the 21% inflation of the U.S. Consumer Price Index during the same time period. “Mileage/point prices have climbed 28% overall since the last survey five years ago,” write the study’s authors. “[…] The primary reason is the larger flow of miles/points from co-branded credit card accrual, which created more demand and prompted airlines to increase reward prices.”

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It’s been harder to accumulate miles but this airline has the best reward redemption rate

April 4, 2024

USA Today

Airline reward tickets are getting more expensive. While cash fares for flights are rising slower than inflation, a new report from IdeaWorksCompany, a consultancy focusing on ancillary airline revenue, shows that reward redemptions are getting even pricier than paid-for tickets. According to the analysis, airline reward ticket prices have increased 28% on average in the last five years, while the Consumer Price Index rose 21% over that same period. The survey was based on 600 fare queries at six different U.S. airlines.

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Airlines made US$33 billion from baggage fees worldwide last year, and they could make even more this year

February 28, 2024

South China Morning Post

Airlines made US$33 billion from baggage fees worldwide last year, and they could make even more this year. Last year’s estimate is up almost 15 per cent from 2022, and it’s the first time it’s crossed US$30 billion since before the pandemic. Carriers could be set to make even more this year, as several US airlines have upped their checked bag fees. Baggage fees alone were worth an estimated US$33.3 billion to airlines last year. That’s according to a report from IdeaWorksCompany, a consultancy for airline ancillary revenues, and car rental firm CarTrawler.

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Why Airlines Are Charging More to Check a Bag

February 27, 2024

Skift

Another reason airlines are increasing bag fees may be to boost sign ups for their loyalty programs and co-branded credit cards. For example, United said travelers that own a United Chase credit card or are members of its MileagePlus program will still be able to check in a bag for free. American said AAdvantage status members and credit card holders can also check in their first bag for free. Jay Sorensen, the president of airline consulting firm IdeaWorksCompany, said bag fee waivers was one of the primary benefits of holding a co-branded credit card. “If you make bag fees more expensive, you are making the credit card more valuable to hold,” he said. “I think that a good portion of all of the headlines regarding American increasing their bag fees can also be seen as a promotion for taking the co-branded credit card.”

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Airlines made $33 billion from baggage fees last year, an analysis of over 120 major airlines estimates

February 27, 2024

Business Insider

Baggage fees alone were worth an estimated $33.3 billion to airlines last year. That’s according to a report from IdeaWorksCompany, a consultancy for airline ancillary revenues, and car rental firm CarTrawler. IdeaWorks’ report analyzes revenue disclosures from around 120 major airlines around the world, before collating a global estimate.

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Report: Airlines Made $33 Billion Last Year Charging For Checked Bags

February 23, 2024

Entrepreneur

A new study from IdeaWorks examined how much customers paid for baggage-related fees last year across 20 airlines. Paying a fee to check a bag seems like an unnecessary added cost, especially when you have no choice — you need your luggage to travel with you. And according to a new report, those baggage fees really add up for the biggest airlines that reported major earnings on the fees alone. A study by ancillary revenue and travel industry specialists IdeaWorks suggests that, in 2023, the top 20 airlines in the world made $33 billion in baggage fees, up 15% from the same time last year when airlines made $29 billion in 2022.

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Airlines Make Whopping $33 Billion On Bags, See Where They Fly Free

February 20, 2024

Forbes

A recent study by ancillary revenue specialists IdeaWorks reveals airlines earned $117.9 billion from extras, including onboard sales, baggage charges, seat selections, and loyalty programs last year. Airline revenue from baggage fees surged to $33 billion. This is a significant 15% increase over the $29 billion airlines earned from bags in 2022 and exceeds the $32.9 billion in baggage fee revenue airlines made in 2019, pre-COVID.

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Airlines will make a record $118 billion in extra fees this year—their websites are designed to get you to pay

November 19, 2023

Fast Company

Airlines are piling on fees for checked bags, assigned seats, and other extras. Here’s how their websites pressure fliers into paying for them. It’s not your imagination: Airlines are piling on more fees and extra charges, driving up the cost of air travel. Across the industry, revenue from what’s known as ancillary sales—fees for selecting seats, checking bags, and buying food, to name a few—will reach a record $117.9 billion in 2023. That’s a 7.7% increase from pre-pandemic records, according to a recent study from airline consultancy firm IdeaWorks and B2B car rental company CarTrawler.

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Special Offers ─ Ancillary Revenue

November 1, 2023

Low Cost and Regional Airlines Magazine ─ LARA

“Three areas of innovation have caught my attention ─ lounges, super apps and booking flexibility,” says Jay Sorensen, President of IdeaWorksCompany and an expert on airline ancillary revenues.  These innovations are highlighted in IdeaWorks’ and CarTrawler’s Airline Revenue Innovations:  A Global Sample of the Coolest Products and Services.

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