Inconsistencies in the Ryanair Low Fare Advertisements

ORRO,
 EVA
 
 
 
 
 
  INTBIZ
 Written
 Assignment
 #1:
 Ryanair
 question
 #1
 
 

p1
 
 
 
 
 
 
 23/03/12
 

QUESTION:
  How
  do
  you
  explain
  the
  apparent
  inconsistency
  between
  low
  fares
  advertised
  by
  Ryanair,
  and
  the
  average
  revenue
  per
  passenger?
 
  To
  answer
  this
  question,
  please
  analyze
  quantitatively
 and
 qualitatively
 all
 the
 sources
 of
 revenues
 for
 Ryanair.
  ***
 
  The
  apparent
  inconsistency
  between
  the
  low
  fares
  advertised
  by
  Ryanair
  and
  the
  average
  revenue
 per
 passenger
 can
 be
 explained
 but
 are
 not
 limited
 to
 the
 following:
 
  I.
 Not
 all
 seats
 in
 a
 Ryanair
 flight
 are
 super
 low-­‐fares
 as
 advertised
 
  a)
  Only
  a
  certain
  percentage
  of
  the
  tickets
  are
  low-­‐fares.
 
  It
  was
  25%
  of
  the
  total
  passenger
  tickets
 in
 2006
 as
 mentioned
 in
 the
 case
 and
 could
 probably
 be
 higher
 by
 now
 but
 no
 more
 than
  50%.
 
 As
 the
 seats
 run
 out,
 fares
 could
 go
 up
 and
 reach
 more
 than
 €300
 for
 top
 destinations
 like
  Malaga
 Spain.
 
 I
 have
 simulated
 a
 sample
 booking
 to
 prove
 this
 point
 (figure
 1).
 
 

Source:
 www.Ryanair.com,
 accessed
 March
 2012
 


 

Figure
 1.
 Sample
 round-­‐trip
 booking
 simulation
 from
 Brussels
 (Charleroi)
 -­‐
 Malaga
 

b)
  Moreover,
  the
  low-­‐fares
 ... [continues]

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