How can you create new revenue streams during a crisis?

1 Offer ancillary services

One of the most common and effective ways to create new revenue streams during a crisis is to offer ancillary services that complement the core product of air transportation. Ancillary services are any additional products or services that customers can purchase before, during, or after their flight, such as baggage fees, seat selection, priority boarding, inflight meals, entertainment, wifi, insurance, car rental, hotel booking, and so on. Ancillary services can provide significant value to customers who are looking for convenience, comfort, or customization, and can also increase customer loyalty and satisfaction. According to IATA, ancillary revenues accounted for 12.2% of total airline revenues in 2019, and are expected to grow even more in the post-pandemic era.

2 Diversify the business model

Another way to create new revenue streams during a crisis is to diversify the business model and explore new markets, segments, or niches that are less affected by the downturn or have unmet needs. For example, some airlines have launched cargo-only flights, charter flights, repatriation flights, or scenic flights to cater to different types of customers and demand. Some airlines have also leveraged their brand, assets, or expertise to offer new products or services that are not directly related to air travel, such as selling inflight meals, merchandise, or vouchers online, renting out aircraft or equipment, or providing training or consulting services.

3 Partner with other businesses

A third way to create new revenue streams during a crisis is to partner with other businesses that can offer complementary or synergistic value to the customers or the operations. For example, some airlines have partnered with health care providers, testing labs, or insurance companies to offer COVID-19 testing, vaccination, or coverage to their passengers, which can increase their confidence and safety. Some airlines have also partnered with tourism boards, hotels, or attractions to offer bundled packages or discounts to their customers, which can stimulate travel demand and spending. Partnering with other businesses can help airlines to access new customer bases, reduce costs, share risks, and create win-win situations.

4 Innovate the customer experience

A fourth way to create new revenue streams during a crisis is to innovate the customer experience and offer new features, benefits, or options that can differentiate the airline from the competition and meet the changing needs and preferences of the customers. For example, some airlines have introduced flexible booking policies, enhanced hygiene measures, contactless check-in, or biometric boarding to provide more convenience, security, or peace of mind to their customers. Some airlines have also offered premium services, such as private suites, lie-flat seats, or personal assistants, to attract high-end customers who are willing to pay more for comfort and exclusivity. Innovating the customer experience can help airlines to increase their value proposition, customer satisfaction, and retention.

5 Engage with the community

A fifth way to create new revenue streams during a crisis is to engage with the community and build trust, reputation, and goodwill among the stakeholders. For example, some airlines have supported social causes, such as donating flights, meals, or masks to health care workers, transporting medical supplies, or planting trees. Some airlines have also launched campaigns, contests, or events to connect with their customers, employees, or partners, such as inviting customers to share their travel stories, rewarding employees for their efforts, or hosting webinars or workshops. Engaging with the community can help airlines to enhance their brand image, customer loyalty, and social responsibility.

6 Experiment with new technologies

A sixth way to create new revenue streams during a crisis is to experiment with new technologies that can improve the efficiency, productivity, or quality of the operations or the services. For example, some airlines have adopted artificial intelligence, big data, or blockchain to optimize their pricing, revenue management, or loyalty programs. Some airlines have also implemented augmented reality, virtual reality, or 3D printing to enhance their marketing, training, or maintenance. Experimenting with new technologies can help airlines to gain a competitive edge, reduce costs, increase revenues, or create new opportunities.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?