Skift Take

In the past decade, airlines have successfully convinced flyers to pay for everything from seat assignments to checking bags. But some of their most loyal customers are fuming.

Cookbook author and television personality Nathalie Dupree longs for the days when she could simply walk to an airport counter, purchase a plane ticket, and get on a jet.

Now, she said, “It might take me half a day to get it booked.”

Dupree, who lives in Charleston, South Carolina, must wade through a list of decisions, including whether to choose one airline for a cheap ticket, but no frequent flyer miles, or another, costlier carrier that gives her points.

She has to pick which credit card to use, whether it’s the one issued by an airline that gives her free checked baggage, or another that means she’ll pay to check luggage.

“It’s quite a come down from my first European trip when I arrived late to the airport and they bumped me up to first class,” Dupree said. “In short, flying is no fun anymore.”

Dupree’s experience is repeated millions of times per year by airline passengers maneuvering through the forest of fees and other features that the carriers want to charge, or sell them.

This year marks a decade since United Airlines, US Airways and American Airlines the latter two (then separate carriers) decided to charge travelers $15 to check their first suitcase. They implemented the fees only months after five carriers began charging for a second or third bag.

Their excuse was the high price of jet fuel, which topped $4 a gallon in summer 2008 before the Great Recession gripped the country that fall.

The major companies were following in the footsteps of low-cost carrier Spirit Airlines, which was already charging for checked baggage.

No one – neither airlines, nor passengers – really knew what kind of change was about to take place. “My sense was the industry’s initial implementations were hurried, without much thought as to how passengers would play the new game,’” said Robert W. Mann, Jr., an airline analyst and consultant.

As it turned out, passengers were willing to pay. In 2007, American collected just $124 million in baggage fees, according to the Bureau of Transportation Statistics. One year later, American collected $277 million in baggage fees.

In the first three quarters of 2017, American’s baggage fees resulted in $827 million in revenue, BTS data shows.

A decade ago, United officials forecast that they could collect $1 billion a year in all passenger fees. Yet in 2016, United collected $6.2 billion in ancillary revenue, according to a report by IdeaWorks, which tracked the income from fees from 138 carriers worldwide.

Passengers Must Be Crafty

The wide variation between fees caused a revolution in how passengers choose which airline to fly, and what features to buy.

Doug Mitchell, a Washington D.C.-based consultant for NPR and the Online News Association, an industry group, decided last year that he would only use Southwest Airlines for his frequent domestic trips.

One reason, he said, was that Southwest does not charge fees for checking up to two suitcases.

As a frequent flyer, Mitchell quickly earned A-list status, allowing him to board early and choose his preferred seat if it’s available. He said he enjoys watching other passengers board after him and try to wedge their carry-on bags into overhead bins.

“I hate flying outside of that,” Mitchell said. “I’m wondering what other U.S.-based corporations hate its customers as much as airlines do.”

No airline would admit to hating customers, but the carriers have been upfront about their shift in attitude toward plane tickets.

“Rather than take Humpty Dumpty and put him back together, they took Humpty Dumpty and pushed him off the wall,” said Henry Harteveldt, a travel industry and consumer analyst who is co-founder of Atmosphere Research.

The past decade has seen an unbundling of the features that went into plane tickets.
In 2008, Delta Air Lines then-president, Ed Bastian, said a trip included “a ticket, a bag and a safe and reliable experience.”

But free bags are no longer a guarantee at Delta, where Bastian is now chief executive. Delta’s fee, originally $15, is now $25, unless passengers qualify for a waiver.

To get a free bag, they can use a Delta-branded credit card, for instance. Or they can purchase seats in the Delta Premium Select cabin on international flights. Or, they can be an elite frequent flyer, where free baggage checks starts with the Silver tier.

Once, flyers consolidated their travel on a single airline to earn miles for free tickets. Now, free baggage is a reason that attracts them, among perks that used to be included in the price of a ticket, like the right to choose better seats for free.

“I work hard to stay a frequent flyer elite (on United) so that I don’t have to pay fees,” said Tommy McCall, founder and CEO of Infographics Inc. “It’s great to get everything from lots of free baggage and Economy Plus or first class upgrades, down to a complimentary snack and beverage.”

He tracks his airline spending and miles on a spread sheet to make sure he qualifies for the extras he most wants, and calculates he saves $10,000 to $15,000 a year in additional spending, much of it from free upgrades on international flights.

Harteveldt said passengers now are “able to buy the things they value, that matter for their trip and that they can afford.”

But that sometimes backfires. Deborah Gobble, a New York-based writer who specializes in medical patient education programs, said she’s annoyed when she pays a baggage fee, only to see flight attendants ask for last-minute volunteers to check carry-on bags.

“I wind up feeling like a chump,” Gobble said.

Selling Experiences

Harteveldt said he sees another revolution in the works beyond simply charging for various features. “We’re seeing airlines transform from selling us tickets to selling us products or experiences,” Harteveldt says.

Although airlines traditionally have talked about the value they place on customer loyalty, the reality is that they’re more interested in passenger dollars than repeat business, Harteveldt said.

That’s why some features that used to only be available to elite flyers are now up for grabs by anyone in the cabin.

Passengers, regardless of the price of their fare, can purchase access to airline clubs and speedy security lines. They can pay to board the plane early, giving them access to the best locations for their carry-ons, and they can purchase extra legroom and the seat location they want within their ticket class.

That causes some grumbling among flyers, upset they may not be able to stow their bag above their seats, even if they buy relatively expensive coach tickets.

“I don’t mind the small seats and lack of service, but I do resent the choice between wrestling with a bag and paying money to make the boarding and disembarking process safer and faster,” said C. Claiborne Ray, a retired Brooklyn-based editor.

Harteveldt said airlines have a right to charge what the market will bear, and as the statistics show, the market has been willing to bear a lot during the past decade.

“What I would appreciate, honestly, would be that airlines would be more transparent in their behavior,” he said. “People are saying, ‘Why should I be loyal to an airline for benefits I am not receiving?”’

Toni Simonetti, a Connecticut-based corporate consultant and million-mile flyer on Delta, can check two free bags on each flight, but still feels nickel and dimed by the airline’s fees for changing flights as well as selecting seats. Said Simonetti: “Absurd.”

And if there’s any word to describe what the process has become in a decade of airline fees, that may be it.

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

Have a confidential tip for Skift? Get in touch

Tags: airline fees, airline innovation, airline passenger experience, bag fees

Photo credit: A Southwest Airlines customer checks a bag in Los Angeles. Southwest is the only larger U.S. airline that allows passengers to check two bags for free. Southwest Airlines

Up Next

Loading next stories