Quick answer
Airline ancillary revenue is money an airline earns beyond the base fare, from holidays, stopovers, seat and bag add-ons, transfers, insurance and loyalty. The airlines growing it fastest run their own branded retail platform, so they sell the whole journey and keep the margin, rather than handing it to third parties.
Selling seats is a thin-margin business. Selling the trip around the seat is not. That is the simple idea behind ancillary revenue, and it is where more and more airlines now compete. This guide explains what airline ancillary revenue is, why it matters now, the main ways to grow it, and what it takes to get started.
What is airline ancillary revenue?
Ancillary revenue is everything an airline earns on top of the ticket. That ranges from the familiar (seat selection, extra bags, priority boarding) to the far more valuable (holiday packages, stopover programmes, tours, transfers, insurance, and selling loyalty points). The common thread is margin: these products typically earn more per booking than the airfare itself, and many of them cost little to add once you have the platform to sell them.
Why ancillary revenue matters more than ever
Base fares are under constant pressure, and passengers increasingly expect to buy their whole trip in one place. When an airline only sells the seat, it hands the rest of the journey, the hotel, the tour, the transfer, and the customer data that comes with them, to an online travel agency. Growing ancillary revenue flips that: the airline captures more of the trip's value, builds a direct relationship, and keeps the data to sell smarter next time.
The main ways airlines grow ancillary revenue
There is no single lever. The airlines doing this well combine several, all under their own brand:
Branded holidays
Dynamic packages of flights plus hotels, sold on the airline's own holiday site.
Stopover programmes
Turn a hub layover into a paid mini-trip with a hotel stay and activities.
Smart cross-sell
Seats, bags, transfers, tours and insurance offered at the right moment in the flow.
Loyalty earn and burn
Let members spend and earn points on everything, keeping value in-brand.
Each one is a revenue stream on its own. Together, on one platform, they compound, because the same passenger can be offered a holiday, then a transfer, then points, all in a single journey.
Sell the journey, not just the seat
The shift is from selling a flight to selling a trip. Airlines that make it see two things move: a higher direct share (more customers booking with the airline instead of an OTA) and a higher ancillary value per booking. As a benchmark from the airlines running this model:
+42%
direct share
$68
ancillary value per booking
Owning the booking is not only about the extra sale today. It is the customer data and the direct relationship that let an airline merchandise better tomorrow.
How altovo helps airlines
altovo (formerly easyGDS) turns an airline's flights into a full travel business, without replacing the systems it already runs. Airlines get a branded holiday platform, stopover programmes, smart cross-sell and loyalty, all in their own identity, live in weeks rather than quarters. It is a travel commerce platform that layers on top of the existing stack. Malaysia Airlines runs its MHholidays brand on it, and Etihad Airways is live on altovo too.
Frequently asked questions
What counts as airline ancillary revenue?
Any revenue beyond the base fare: seat selection, extra bags, holidays and dynamic packages, stopover programmes, transfers, tours, travel insurance, and loyalty point sales. These usually carry higher margins than the ticket itself.
How do airlines increase ancillary revenue?
By selling the whole journey rather than just the seat. The fastest-growing airlines run their own branded retail platform to offer holidays, stopovers, add-ons and loyalty at the right moment, keeping the margin and the customer relationship.
What is an airline stopover programme?
A stopover programme packages an airline's hub as a destination, letting connecting passengers add a hotel stay and activities. It turns a layover into a revenue-generating mini-trip and deepens the passenger relationship.
Do airlines need a new system to sell holidays and ancillaries?
Not a full replacement. A travel commerce platform such as altovo layers on top of existing systems, adding branded holidays, stopovers, cross-sell and loyalty without replacing the core. A branded holiday site can go live in weeks.
See altovo in action
Book a short demo and see how your airline can sell the whole journey, under your own brand.
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