Ancillary watch: Breakdown of airline fees show growth opportunities in 2014NewsBy Nick Vivion | October 29, 2013Share This article was originally published on The projected total ancillary revenues posted by global airlines in 2013 highlight growth opportunities for airlines looking to boost those numbers next year.The numbers include a steady growth over the past few years, as airlines have both unbundled their offerings and increased sophistication when it comes to retailing additional travel products.Airlines have grown their share of revenue from ancillary fees from 4.8% of global revenue (or $474 billion) in 2010 to a 5.4% share of global revenue (or $667 billion) in 2012.Looking towards the final two months of 2013, the total global revenue from ancillary revenues will come in at $708 billion, or a 6% share of total revenues, according to the IdeaWorks Company and CarTrawler report.The breakdown is as follows, when considering traditional airlines (global flag or legacy airlines), major US airlines (American, United, and Delta), ancillary champs like JetStar which focus on ancillary revenues to differentiate service, and low-cost carriers which often unbundle every type of add-on from the core fare (WestJet, for example).Or, in percentages of share:The larger airlines clearly take a larger piece of the pie, given the total flight counts annually.The key information for airline marketers looking to leverage technology and other assets into ancillary growth is when it comes to the comparison between US-based airlines everyone else.The typical major American airline sees the majority of ancillary revenue from the sale of frequent flier miles, followed by baggage fees and other on-board retail and a la carte services.The most pressing issue facing this segment of airlines is the tepid 5% of revenues brought in by their travel retailing efforts. Outside the US, the picture is much different.Non-US airlines do an excellent job of diversifying their ancillary revenue stream. Both onboard retail and travel retail are a much more robust part of the business. This means that these airlines are using pre-trip e-mail marketing in addition to in-funnel upselling to deliver a more broad base for their ancillary revenues.Onboard revenues are also larger, showing a demand for higher-quality foods and other duty-free retail items by non-US passengers.These airlines have a slight edge on the US-based airlines, booking .5% more ancillary revenue in 2013. This diversification strategy is working - and it will be even more interesting to see how this shakes out in 2014. US airlines are striving to do better on the retailing front, but will likely continue to be eclipsed by other airlines as they use their growing knowledge to continue improving how they retail.US airlines must take note, and work to improve their retailing efforts (more on that here) which will diversify their ancillary revenue stream. This then reduces reliance on one part of the business, while also allowing each area of the ancillary basket the opportunity to thrive and grow.The full report can be viewed here.NB: Red bag image courtesy Shutterstock.