Reducing airline ticket costs: There is an airfare war raging in the industry and airlines are reducing airline ticket costs by offering discounts and low cost tickets to compete with each other. In fact one of the lowest cost airlines is offering a first class ticket for just $10 more than a rival low cost airline.
This is just one of the countless examples of how the industry has shrunk costs while increasing revenue. But how has the industry done so?
The following story gives a few examples of the efforts that airlines have made to drive costs down while increasing revenue.
Reducing Airline Ticket -Airlines Push For Low Cost Ticket Sales
From their perspective competition is good for their bottom line. And from the perspective of the customer, it’s another option. But the battle for your dollars is heating up. For example, if you book a flight at the lowest cost airlines like Southwest, you are probably getting the best value for your dollar, but you are essentially getting a lower-cost ticket.
It’s a race to slash costs and drive revenue. Airlines see low-cost ticket sales as the way to drive revenue. As low-cost ticket sales increase, airlines are forced to come up with other ways to cut costs and therefore their costs.
Airlines Are Cutting Costs But Not Their Ticket Prices
The airlines are reducing costs in other ways, but those ways aren’t always apparent to the consumer. For example, you may see a low cost airline reduce their costs by reducing airport security. While that may seem like a cost reduction, there are usually impacts to baggage fees. Or you may see a cost cut by eliminating in-flight meals and beverage service. Then there are the efforts to cut costs in other areas. These efforts are hidden from the consumer.
In-flight meals and beverage service, for example, are on the chopping block. Some low cost airlines are doing away with in-flight meals in favor of cheaper snacks. The message to the customer is that meals are not necessary. It’s an attempt to rationalize flight cost by getting rid of additional expenses, but the impact is being felt by the consumer, as fewer meals means fewer economical meals.
Reducing Airline Ticket Costs: Airlines Are Reducing Baggage Fees
Another attempt to rationalize cost is the practice of charging for baggage. Airlines are doing this to collect revenue, as they have traditionally relied on fines to fund their operations. But as the cost of flying has decreased, so has the revenue collected from baggage fees.
Reducing Baggage Fees Is Good For Consumers
Increasing baggage fees is also good for consumers, as the practice is a way for airlines to recover costs. Airlines are trying to rationalize costs so that they can maintain services and quality, but the effort is a little difficult to spot.
Reducing Airline Ticket: Airline’s Efforts to Re-Finance
The airlines are trying to re-finance costs through these measures. Increasing fees for baggage is one approach, while others are focused on reducing services. Cutting services will reduce cost but increase the hassle to the customer, but will save money.
The message to the consumer is that, while costs are going down, the service quality is going down, as fewer services and services reduced can result in higher expenses.
The message to the consumer is that, while the cost of flying is going down, the level of service will continue to increase.