US domestic airlines: segmented fares, changing customer behaviour
The US domestic airline market is arguably the most mature in the world, which means traffic stimulation opportunities are more limited than in other emerging regions.
But ultra low cost airlines believe that market concentration in the US creates opportunities to lure the infrequent traveller into taking more trips, and they’ve grown rapidly in the market during the last decade.
US full service airlines have also opted to court the infrequent traveller through the introduction of segmented fares, featuring a basic economy option. Although segmented fares seemingly allow those airlines to compete more effectively with ULCCs, they’re really a way for American, Delta and United to drive customers into higher fare buckets, and ultimately grow their revenue.
The country’s largest lower cost airline, Southwest, has also declared that it is preparing to launch new ways to drive revenue in 2020 as it regularly fields questions about its response to product segmentation in the market place.
Become a CAPA Member to access Analysis Reports
Our Analysis Reports are only available to CAPA Members. CAPA Membership provides exclusive access to in-depth insights on the latest developments in the aviation and travel industry, developed by our team of dedicated analysts located in Europe, North America, Asia and Australia.
Each report offers a fresh perspective on the latest industry trends and is available online or via the CAPA mobile app, with customisable alerts to help you stay informed and identify new business opportunities.
CAPA Membership also provides access to our full suite of tools, including a tailored selection of more than 1,000 News Briefs every week and comprehensive data and analysis on thousands of companies around the world.