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Segmentation of customers and products was a focus of distribution discussions during the major US airlines’ second-quarter earnings calls. The carriers, which are in the process of dividing economy class into three segments – economy, basic economy and premium economy – like what they see in terms of upsell rates. Delta Air Lines said Branded Fares – its collective term for its economy segments — drove 40% of the improvement in passenger revenues in the quarter. But while the low fares may lure customers onto American’s website, they aren’t necessarily what customers are buying. About 50% of the customers who are offered basic economy opt for regular economy in the end. The company expects to retrofit most of its wide-body aircraft that serve international routes with Premium Economy by the end of 2018. Read original article |
