Airline drip pricing: soaring fees or flexible flying?

by Alex Rogers, Consultant
27/10/2023

With summer over and as the holiday spike of flights to European nations subside, budget airlines can cast a wry smile at what seems to have been a very profitable season. With the shadow of covid finally lifting, passenger numbers are continuing to increase, particularly for ‘budget’ airlines, as European destinations have opened up again. However, calls are now growing to tackle the way airlines handle their passenger experience, with many who are searching for a cheap getaway left resisting a wave of attempted add-on charges.

We’ve all been there, scrolling through a comparison site and feeling an initial surge of delight as the much-needed getaway is offering flights to Barcelona at only £45 per person. However, this delight is often short lived as a journey through pages after pages of priced offerings and attempts to fatten the price of the original advertised ticket await. Seat selection, baggage, flight insurance, wi-fi, in-flight meals, speedy boarding and even car rentals are all offers thrown at you as you try to navigate your way through the never-ending maze to the budget ticket that drew you in initially.

By the 7th “great deal” offering, many are desperate to end the difficult and what can feel extortive booking process they have begun. Most customers reach the checkout in a state of confused and anxious exhaustion, worried whether their rucksack qualifies under the free baggage guidance or if the baggage fee is really a necessary expense.

This ‘drip-pricing’ occurs more and more frequently across the aviation industry with hidden extras not being the small increments many would initially anticipate. Some recent examples have shown a huge £115 to change a name on a ticket or £70 to add a standard suitcase. For some it turns budget holidays from highlights of the year into completely unaffordable pipedreams as price additions spiral costs out of control.

The Government attributes £1.6 billion in total with drip-pricing across all sectors in the last year and this huge figure has spurred new action from Westminster, with the Government recently concluding a 6-week consultation to improve transparency across all sectors effected by drip-pricing.

Does this drip-pricing represent ‘sneaky’ behaviour for profiteering or is it just adding to consumer choice?

For some, drip-pricing epitomises consumer choice. It breaks down price packages to give you the authority to decide what you pay for. Compulsory purchasing of luggage space, prime seats and other unwanted add-ons, removes non-essential spending and in turn can deliver huge savings to those travelling light.

In recent years drip pricing has moved beyond the airline industry and plays an increasing part across various sectors. Additional costings to your Trainline, Deliveroo and Uber orders show the experiences of drip pricing on a day-to-day basis that many don’t even know. What separates these additional charges is the key issue of transparency. Whilst nobody enjoys paying the extra costs, they are usually clear or added from the outset. Critics of airline style drip pricing highlight that for many, the list of seemingly endless charges leaves an almost cheated and resentful taste in the mouth.

Complex websites with hidden information boxes reinforce the ambiguity of the booking process as ‘baiting’ customers to making ‘hassle costs’ on unnecessary additions to their ticket package. It also hides the true cost from the consumer, leading customers down a long path before revealing the true extent of their purchase. From recent announcements, it’s clear that the Government agrees with them that clarity and transparency need greater attention.

Current legislation requires businesses to provide all consumers with a clear and concise breakdown regarding the price of their ticket and any additional charges. Whilst airlines remain adamant that this is the case with their own websites, the government is yet to be convinced.

Politically, this comes at a time when the Government lags behind in the election polls with just over a year until the next general election will have to be called. Siding with the consumer on this issue, even if they are not directly aware of it, provides an opportunity to present the Government as saving the public money and fulfilling their commitment to ease the cost-of-living. Addressing drip-pricing, in addition to clear labelling, is an area Labour had previously commented on, promising action to tackle when next in government, so could this be an opportunity for the Government to regain the front foot on this issue?

Whatever your views on drip-pricing, it is everywhere. The often not-so-small increments that turn budget holidays into cost-flaring vacations are being challenged strongly by all levels. Whilst airlines continue to be on the defensive, the Government is beginning it’s manoeuvres to positioning itself on the side of the consumers who value transparency over bespoke benefits