Skift Take

Airlines want the ability to make personalized offers to Millennial business travelers and other generations. They likely already have this data, and a whole lot more based on actual buying patterns.

A generational shift is under way in business travel: Millennials will supplant Gen X business travelers in spending by 2020, according to a new study.

Boston Consulting Group’s Traveling with Millennials traces their spending habits and posits that Millennial business travelers, age 18 to 34, will account for 46% of spending on business flights from the U.S. by 2020, up from 35% in 2013. And, older Gen X business travelers would see their share drop to 34% by 2020, down from 38% this year, the study shows.


The survey found that Millennial business travelers are more diverse than non-Millennials (60% more Hispanics and double the percentage of Asian-Americans), and the Millennials spend about as much per year as non-Millennials on flights even though the Millennials fly less frequently.

“That’s because they do more international travel, buy more refundable nonupgradable tickets, book their tickets later, and tend to make more itinerary changes per business trip than non-Millennials,” BCG states.

Business travelers, after all, come with disparate preferences, and BCG tried to portray that in the following chart:

BCG diverse business travelers

Millennials, BCG found, report spending about 13% more per flight ticket on average than older business travelers.

Airlines that are busy selling premium seats to attract more ancillary revenue should consider tailoring their marketing to Millennials, who are 60% more likely to purchase upgrades for additional legroom, according to the study.

Millennials also are more apt to purchase in-flight entertainment, and Wi-Fi, the study states.

“Onboard, they are four times more likely to pay for Wi-Fi, twice as likely to watch downloads on their mobile devices, and 60 percent more likely to watch in-flight entertainment,” the study found.

Regarding upgrades, Millennials express a preference to earn discounted travel benefits from loyalty programs as opposed to earning elite status and other rewards, BCG found.

When it comes to choosing airlines, Millennials like JetBlue and Southwest, but they don’t fly the two carriers as often as they would like because of the relative lack of availability of their flights, the study found.

The study fits in with airlines’ and other marketers’ desires to know more about their customers so they can segment them and market to them more effectively.

“To succeed, companies should segment their customers to identify those most engaged in business and leisure travel; the segments that are most profitable; each segment’s unique behaviors, needs, frustrations, and preferences; and the return on investment from meeting each segment’s needs,” BCG states.

“Armed with these insights, companies can determine how well-positioned their brands are for the targeted segments and — at a minimum — adjust their messaging, communications frequency, and media mix accordingly.”

In short, Millennials won’t be starved for attention in coming years.

Reach new heights in aviation
November 12 in Dallas
See Who's Onboard

Have a confidential tip for Skift? Get in touch

Tags: wi-fi

Up Next

Loading next stories