Ad revenue from aircraft

AD REVENUES FROM AIRCRAFT

The cut-throat fare war in the domestic skies sending profit margins into a tailspin and therefore new-born airlines are trying to squeeze all resources and every square inch of space on their aircraft to shore up bottom lines.

If start-up carrier ‘Go Air’ is selling ad space on the overhead baggage lockers inside its aircraft and on tray tables, Air Deccan already has companies pasting ads on its aircraft body and is going a step further and inviting ads on seat backs and even the aircrafts aisles.

Not to be left behind, the latest entrant in the Indian skies, ‘IndiGo’ is in talks with Pepsi and credit card companies to start advertising on its crew uniforms. It is additional revenue, without having to invest a penny, says the CEO of IndiGo. These ads can help us squeeze out a bigger profit.

For Air Deccan, these non-operational activities are spelling big money. Income from ads and excess baggage charges alone account for nearly 9% of their total revenue. They say that they have put up television screens inside the aircraft and run ads on it. They are on the lookout for newer ideas to increase advertising revenue says Air Deccan managing director G R Gopinath.

Selling Space

* Go Air is selling and space on the overhead baggage lockers inside its aircraft on tray tables.

* Air Deccan, which has companies pasting ads on its air craft body, is going a step further and inviting ads on seats backs and even the aircrafts aisles.

* IndiGo in talks with Pepsi and credit companies to start advertising on its crew uniforms.

* US Airways decided to sell ads on its airsickness bags.

While this additional revenue seems to have caught the fancy of the new-born no-frills carriers, the legacy airlines in the Indian skies are flying in the opposite direction. Indian Airlines, for instance, used to book ads on its passenger boarding cards. The practice has been discontinued. Now their justification is that it was not in tune with the airline’s philosophy. The IA says they would look at maintaining costs and improving service standards than mopping up ad revenues.

But looking at advertisements as an alternate revenue stream is gaining ground even among carriers in the global marketplace. Recently, US Airways decided to sell advertisements on its airsickness bags. They’re in every back seat pocket and while it’s there they want to make it multipurpose. US Air passengers should see the new, commercialized sickness bags in this year.

The idea seems to have already inspired Go Air, which is now looking at a similar option. They want to extend the ad activity from just airsickness bags to almost everything inside the aircraft say from aisles to toilets and baggage racks. It is additional money coming in says ‘Go Air’ managing director Jeh Wadia.

In fact, if you stand long enough inside our aircraft, we will paste an ad on you too, adds Gopinath the CMD of Air Deccan in lighter vein.

The Innovative ad ideas ultimately result in passengers traveling economically as the ad revenues compensate part of the expenses. In today’s competition between Airlines one can travel by Air on some sectors at the cost of II A.C. train travel. The ad revenues may help the airlines giving a further stiff competition to the Railways. Overall the passenger stand to gain.