Spirit Airlines is a well-known low-cost carrier in the United States. From its business model, Spirit derives a significant amount of its revenue from ancillary fees.
How much exactly? Well, about 50% of the total revenue comes from non-ticket sales.
Spirit's accessory recipes
The CAPA Center for Aviation released a report detailing Spirit's successful ancillary revenue figures. According to the report, 50% of Spirit's revenue is made up of ancillary revenue, the famous extra services for engers.
And the airline continues to grow that number. In 2020, Spirit expects a 3% increase compared to 2019 in revenue formed by extra services.
However, given Spirit's low fares, it's not surprising that the airline generates revenue from extra fees.
Ancillary products on Spirit Airlines
Spirit Airlines does an excellent job selling airline tickets.
In addition, the airline also has a robust scheme designed to increase ancillary costs.
Let's take a look at Spirit's booking engine on a flight from Detroit to Orlando.
At $37,30, this flight sounds like a great bargain! Considering the distance to be covered.
After clicking “continue”, the booking engine offers you a package.
The package itself offers a wide range of benefits which are also available for individual purchase, if only some of the benefits are attractive you can decline the package and choose individually in the following steps.
The next screen after entering enger information outlines the checked baggage costs for this purchase.
Then comes the costs for seat selection.
Arguably, it would cost Spirit nothing to let engers choose seats for free. However, many travelers probably want to have a choice about where they're sitting on a plane — especially families.
Additionally, Spirit Airlines offers additional options like flight modifications, dedicated security and priority boarding in case you're a famous person who can't wait another 5 minutes to get on the plane.
Ultimately, Spirit expects engers to spend more on ancillary costs than on the airfare itself. Needless to say… But it is likely that many people will use some additional options, especially in the luggage part.
In flight, Spirit has more opportunity to earn, selling meals and drinks like most Low Cost.
It is up to the customer to consider the options at the time of purchase, and also during the flight period, to be transported at a very low cost when compared to large companies.
