Passenger Preference for Increased In flight Privacy and Innovative Fare Structures in Business Class will Drive Growth
Business class revenue was a key growth driver for airlines as they attempted to resurrect from COVID-19 pandemic-related service disruptions. The emergence of the new traveler segment, the luxury leisure traveler, ensured business class cabins remained fully booked throughout the seasonal tourism periods. Overall, passenger preference for privacy on board aircraft was high, which led to many passengers opting for business class travel, despite higher fares.
Airlines have been experimenting and innovating around many avenues, such as improving service quality, adding new service elements, sustainability, and new fare structures. While lie-flat seats and direct aisle access were considered benchmarks before the pandemic, seats equipped with doors for increased privacy are the new benchmark for passengers. On the sustainability front, direct contribution from original equipment manufacturers (OEMs) is scarce, while airlines are trying to implement sustainable best practices within their business class cabins.
The last decade saw a growing trend of low-cost carriers (LCCs) offering business-class products, largely due to their high profitability. Airlines are also experimenting with new fare structures, primarily the unbundling of complementary services. The unbundled fare strategy has become a strong growth opportunity, especially for airlines facing low load factor and yield scenarios.
Key Issues Addressed:
- How is the unbundled fare strategy implemented, and what are the related growth opportunities?
- What important considerations do passengers analyze while selecting their itinerary?
- How are LCCs embracing business-class products?
- What are the latest best practices and innovations seen in global business-class cabins?
