Why Do Airlines Revenue Derived From Non-Aeronautical Revenue?
4.2. Diversifying revenues
In recent years it has been widely believed that airports have become increasingly reliant on non-aero revenues. Over the past 15 years, the proportion of revenue derived from aeronautical activities has slightly increased indicating that the share of revenue derived from non-aeronautical activities has decreased.
Financial crises, tough competition coming from neighbouring airports and pressure on lowering airport charges from LCCs, have put a dent in airport’s aeronautical income, and an airport losing aeronautical revenue must focus on non-aeronautical income to survive or grow.
To make up from lost aero revenue an airport has to might expect to ramp up its income from concessionaires, retailers, F&B, advertising, and fees from parking. Which results in increased focus on non-aeronautical activity to make up for the inevitable loss in aero …show more content…
This again highlights that the traditional non-aeronautical revenues are heavily reliant on a high volume of passenger traffic brought by aeronautic activities. Some of the main categories included within non-aero revenues which are totally dependent of high volume of passengers are F&B, retailers, concessionaires, car parking, car rental and advertising. So during the tough times how can airports ensure that non-aero revenue maintains the same rate of growth irrespective of fluctuations in passenger volume?
This is why “diversifying revenue streams” is the key for airports to run successfully. In recent years some of the airports around the world are leveraging their real estate to achieve this end. This category of non-aero revenue can be entirely disengaged from aviation and can be used to attract consumers and businesses to numerous other services, experiences and products that can be
In recent years it has been widely believed that airports have become increasingly reliant on non-aero revenues. Over the past 15 years, the proportion of revenue derived from aeronautical activities has slightly increased indicating that the share of revenue derived from non-aeronautical activities has decreased.
Financial crises, tough competition coming from neighbouring airports and pressure on lowering airport charges from LCCs, have put a dent in airport’s aeronautical income, and an airport losing aeronautical revenue must focus on non-aeronautical income to survive or grow.
To make up from lost aero revenue an airport has to might expect to ramp up its income from concessionaires, retailers, F&B, advertising, and fees from parking. Which results in increased focus on non-aeronautical activity to make up for the inevitable loss in aero …show more content…
This again highlights that the traditional non-aeronautical revenues are heavily reliant on a high volume of passenger traffic brought by aeronautic activities. Some of the main categories included within non-aero revenues which are totally dependent of high volume of passengers are F&B, retailers, concessionaires, car parking, car rental and advertising. So during the tough times how can airports ensure that non-aero revenue maintains the same rate of growth irrespective of fluctuations in passenger volume?
This is why “diversifying revenue streams” is the key for airports to run successfully. In recent years some of the airports around the world are leveraging their real estate to achieve this end. This category of non-aero revenue can be entirely disengaged from aviation and can be used to attract consumers and businesses to numerous other services, experiences and products that can be