An “Airline Bundle” of Joy? How Airlines Are Reorganizing Business Travel Fees

Want extra legroom? And Wi-Fi? And a flight change fee waiver? There’s a bundle for that.

One creative way airlines are pricing their services these days involves an airline bundle – not necessarily of joy, but rather a group of add-ons that would normally be purchased individually. It’s a departure from the recent past, when airlines deliberately unbundled former freebies from the price of a ticket – like pillows, blankets and food – in order to charge more for what they termed “ancillary fees,” like early boarding and checked baggage.

Now, we’re back to the airline bundle. The idea behind bundling is that the more extras you buy together, the cheaper it is; basically, it’s a re-brand of ancillary fees.

But is an airline bundle a better deal?

 

Not all airline bundles are expensed equally

 

Depending on your company’s expense policy, some items in a bundle may be considered personal, like double air miles or extra legroom. So when buying a bundle, be sure you can differentiate on your expense report the items that are personal in nature versus items that are legitimately associated with doing your job. If you can’t – skip the bundle and go for the per-perk fee.

 

Buy bundles directly from the airlines

 

Unless you buy directly from the airlines, you may not get the latest and greatest bundle deals. Booking fees to third-party sites account for about 1 percent of airline operating expenses. That adds up, so airlines put their best airline bundle discounts directly on their websites in the hopes of enticing travelers to go directly through them.

 

Not all deals are a good buy

 

The Wall Street Journal recently analyzed the bundles of perks currently on offer from U.S. airlines and out of 19 packages, it only endorsed three worth buying. The problem? Most fees for early boarding or seat placement didn’t add up in a cost-benefit analysis. Particularly when you can get the same amenities for free on other airlines.

With 36 airline fees increasing last year, the airlines are using this nascent approach to better target business travelers and their travel managers by up-selling frills at a group rate. And because business travel in the U.S. is expected to increase by 4.6% in 2013, airlines will surely continue to be creative in finding ways to reassess fees – airline bundles and beyond.

 

What do you think about the new ideas from airlines to bundle ancillary fees? Tweet us @Concur and let us know what’s the best deal!

 

 

Photo: emachnic on Flickr

 

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