Airlines add options for seat types and ancilliary products such as meals and bags to not only give passengers more choice but to introduce more price points and generate more revenue.
Last year the airline industry made close to $200 billion worldwide out of added extras, up on 2019, before the pandemic.
Travelport estimates that air travel options have gone from about 500 economy/ business options available in 2010 to more than 10,000 options in 2024 (such as economy, economy plus, flexi-family, business, first). That’s a 1900% increase.
On international flights Air New Zealand in its economy section offers three seating options including Skycouch and from late next year will add another - Skynest, a sleep pod option for travellers.
But last month it overhauled its seats-to-suit products on short-haul international routes to give passengers more affordable flexibility, and in a move away from more complexity ended options for a neighbour-free seat and the opportunity to buy food on its short-haul flights across the Tasman and to the Pacific Islands.
In its 2024 State of Modern Retailing Report, Travelport says when combining international independent research, cross-industry comparisons, and consumer insights, it found that booking travel directly from travel providers has become more time-consuming and complicated than ever.
Other key findings include:
- Most travellers (80%) agree that comparing fares from different airlines is very time-consuming, with more than two-thirds (69%) feeling that information is often restricted on some airline booking sites.
- When it comes to shopping for all components of their trip, 60% said they spend an average of one to four hours planning, while more than one-third (36%) spend more than five hours searching and comparing options before booking.
- Most respondents (88%) agree they would prefer to see all flight options and fares on one screen, which is likely the reason that more than half (54%) said they frequently use a comparison site to search for information before purchasing their ticket.
- The majority of Millennial (70%) and Gen X (64%) travellers often use online travel agencies to book, citing choice and price transparency as the primary reasons.
Travellers are looking to artificial intelligence (AI) to provide more than just a chatbot, and agencies will increasingly rely on their technology partners to implement AI and machine learning in creative ways.
What travellers want
The Toluna Research sample was of 1659 people from Germany, South Africa, Britain, and the United States who have taken at least one or more flights for business or leisure within the last 12 months.
It found that when booking flights, respondents said that luggage allowance (63%), cancellation and change policies (50%), and seat selection (50%), are the most important factors to compare.
Most travellers (63%) also stated that they feel airlines do not put the customer first when it comes to customer servicing matters (flight cancellations, exchanges).
Dynamic pricing and offers among United States-based airlines could be complicating the retailing experience for American travellers, as more US respondents (49%) feel shopping for flights takes more time than comparing hotels (40%), car rentals (8%), and restaurants (3%).
Additionally, more US travellers (47%) say airline offers are not customised to their needs, compared to travellers from Germany (34%), South Africa (35%), and the United Kingdom (45%).
Unlike American respondents, hotel shopping is the more time-consuming experience for travellers from Germany (52%), South Africa (54%), and the UK (59%).
“Travel providers are continually refining and expanding their offerings to fit their customers’ unique needs and preferences,” Catto said.
Travel Agents Association (TAANZ) president Brent Thomas said members had seen a growth in the number of customers that are being dealt with both in retail stores and through brokers.
‘‘The complexity of travel, concern from the large number of travel disruptions that travellers now face, and the continued value added from the travel agent’s knowledge are all aspects of this increase.’'
This year will be another record year for TAANZ members and the forward booking for 2025 was positive, he said.
‘‘Despite the downturn in the economy, travel is not being impacted to anywhere near the same degree as other retail sectors. New Zealanders continue to understand the value that travel brings in creating lasting memories with family and friends and continue to prioritise this expenditure as part of their wellbeing.’'
Travelport powers bookings for hundreds of thousands of travel suppliers worldwide and operates in more than 165 countries.
Grant Bradley has been working at the Herald since 1993. He is the Business Herald’s deputy editor and covers aviation and tourism.
