The fluctuating global oil prices have amplified hedging costs for many airlines, which, in turn, has put severe pressure on airfares, thus making fuel one of the most variable costs for the carriers.
In such turbulent times, ancillary revenue streams and personalisation of airline offerings are effective tools for survival as a means of increasing margins, especially as global ancillary revenues of airlines were expected to have been nearly $50 billion in 2014, according to IdeaWorks.
That said, airlines still suffer from a lack of sales flexibility, which limits their capacity to offer differentiated products to individual customers and to sell ancillary services.