Seen At 11: ‘Bundled’ Perks Take Flight In Airline Industry
NEW YORK (CBSNewYork) — You’ve heard of “bundling” your cable, phone and Internet services. Now, airlines are getting in on the action, too.
As CBS 2′s Maurice DuBois reported, airlines are bundling extras, whether you fly once or several times a year. You can design your own package depending on what’s important to you, such as free checked bags, priority boarding, no change fees, free Wi-Fi or extra frequent-flyer miles.
Joy Preble travels for a living and said it can be frustrating when people lean back far in their seats and “suddenly you can’t even put an iPad on the little tray.”
So on a recent trip, she paid extra for some airline perks, including a seat with more legroom.
“It was a very roomy situation,” she said. “And it was much more pleasant.”
“You’re able to take multiple things, package them together, charge a lower price for each,” explained Gary Leff, a frequent-flyer expert who blogs for BoardingArea.com. “The airline makes more, and you get more things that you want.”
In other words, you pay more than the cost of the ticket, but when you bundle, you pay much less than you would if you purchased these perks individually.
Some airlines are also experimenting with subscription services, allowing passengers to pay a flat fee for benefits on any flights they take within a set time period.
But travel experts note that airline-branded credit cards typically offer similar bundled benefits, with a yearly fee that may be less than you’d pay for a year’s worth of packages or airline subscriptions.
“A subscription service enables them to guarantee that they’re going to have that seat available to them, guarantee that they’re going to have that free checked bag,” said Jean Median, senior vice president of Airlines for America, a trade association representing commercial airlines.
Airlines for America says these packages and subscriptions allow consumers to get better prices on the extras they want while airlines make the revenue they need.
“Last year, the airlines made 37 cents per airplane passenger,” Medina said. “Had they not offered additional services that customers were willing to pay for, they would have lost $8 per passenger.”
Leff said it’s important to examine each package or subscription to make sure it’s really going to be worth it.
“A subscription really locks you into a single airline and, over time, you may wind up paying more in airfare if you pick the same airline over and over than you would if you were going to go around and shop for the lowest price each time,” he said.
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