How Volaris kept revenue flowing during the pandemic

Aviation suffered greatly during the pandemic. Flights were grounded, airports were closed, and passengers were not allowed to leave their homes. As new bookings dropped to zero, one airline’s unique product kept bringing in revenue as if nothing had happened.?

Crisis proof

The product was Volaris’ v.pass, a pioneering flight subscription program that was first launched in 2018. The program, with its more than 30,000 subscribers, brings in the equivalent of 0.5 million seat sales per year and was the first true flight subscription program ever developed.?

The program, with its more than 30,000 subscribers, brings in the equivalent of 0.5 million seat sales per year

It works just like any other subscription. The passenger selects a plan, signs up, and pays a monthly subscription fee in exchange for free flights. Options include a single one-way or return flight per month on any domestic flight, and optional ancillaries like checked bags and carry-on luggage.

During the pandemic, Volaris softened the redemption rules to adapt to the changing situation, and subscribers remained loyal. As a result, in a period where most airlines saw their revenue drop to zero, v.pass continued to bring in money.?

Why it works

Flight subscriptions work by creating a win-win situation: The airline gains a stable revenue stream and increases customer lifetime value, in exchange for offering lower fares to subscribers. The increased lifetime value and associated boost in revenue is derived mainly from two factors.?

First, people who are already paying for a subscription with an airline are highly unlikely to purchase a ticket with a competing airline, meaning that the airline will capture 100% of that traveler’s business, and will reduce its advertising costs.?

51% of people that booked a trip through flight subscriptions wouldn’t have travelled if it hadn’t been for their subscription

Secondly, subscribers will travel more frequently, bringing more business to the airline, and are statistically more likely to purchase ancillaries. In a recent survey by Caravelo, more than 51% of people who booked a trip using a flight subscription indicated that they wouldn’t have travelled if it hadn’t been for their subscription.?

Why Volaris

As restrictions eased, v.pass resumed its pre-covid growth, and is now on track to pass the 35k active subscribers mark by the end of this year. Caravelo is also seeing a substantial increase in the demand for flight subscription programs by other airlines.?

v.pass is now on track to pass the 35k active subscribers mark by the end of this year

One question remains. Why Volaris? Why was a Mexican ULCC the first airline in the world to offer a true flight subscription service? The answer may lie in its corporate culture and the people who work behind the scenes in sales and revenue management teams.?

These people, led by the vision of the company’s founder and CEO Enrique Beltranena, had the courage to look beyond the plane-shaped box that most airlines live in and try something new. Something that had been widely used in other industries but had not yet been applied to aviation.??

The road ahead

Volaris won thanks to its company culture and its people; it innovated and worked with the right partners to develop a great product. We hope that, in the future, many other airlines will follow suit and create cultures that foster this kind of innovation.??

As we write this article, the trend Volaris started is gaining momentum, and Caravelo is working with several major airlines to create their flight subscription programs that will see the light in the coming months. If you would like to join this trend and capture subscribers before your competitors do, drop us line, we’ll be happy to help.??