Wizz Air has introduced new subscriptions that have had an affect on the airline industry. Subscriptions and discount models are changing multiple industries with positives and implications. The question is, does it really work?
Wizz Air has disrupted the airline industry once again with the introduction of its groundbreaking subscription models: All You Can Fly and MultiPass. These innovative subscriptions represent a significant departure from traditional pricing structures, challenging the status quo and potentially reshaping the future of air travel.
We thought we'd take a critical view on the different subscription and discount models deployed by Wizz Air. It's certainly true to say that even putting aside our own cynical view on whether or not these have been launched as PR stunts or serious product development, innovation, Wizz Air certainly stands apart for innovating when it comes to product and pricing.
All You Can Fly: Limited to 10,000 memberships. Subscribers can only book one-way flights with a 72 hours booking window. They're only allowed a carry-on bag, miss three flights (“no-shows”) and Wizz Air reserves the right to terminate the membership with immediate effect and without the option of a refund.
The question here is this. Is this a PR stunt and if so, does it risk damaging the brand's reputation due to the lack of available flights for people with this subscription, or is the publicity all part of the game?
MultiPass: Subscribers can choose one-way or return plans. They can add Priority and 20kg checked-in bag to the subscription, whilst added products cannot be removed from the plan once subscribed. They can only take 1 flight per month and these flights need to be booked 5 days in advance. Wizz Air discontinued the 6-month subscription plan, therefore once the subscription period ends, it automatically renews for the 12-month subscription program for the same country.
This certainly does seem like an interesting model. It targets frequent fliers who regularly go between specific destinations and perhaps goes some way to plugging flights and routes with spare capacity with passengers who are likely to travel when the right opportunity arises.
Wizz Discount Club: This offers a €10 discount on flights over €19,99. It is a model other airlines, such as easyJet, are employing with easyJet Plus, but WizzAir are instead focusing on building a more comprehensive offer, with different discount models for different markets, such as Italy where there's a model geared towards domestic flights.
Whilst this closest resembles a traditional loyalty scheme, it's range of tiers move from rewarding loyal customers with perks and incentives to giving discounts for those paying upfront. This model is being explored in other sectors too, such as with the Coffee and Sandwich chain Pret a Manger, who recently switched from offering an unlimited (5 Drinks) coffee subscription model to boost business after the pandemic, to a £10 a month model, leading to a 50% discount on drinks.
One observation that can be made with all discount propositions is they appear to be heavily skewed towards solo travellers. Another goal might also be aimed at increasing market share against the competition of Ryanair and Easyjet, whilst also eyeing up route development as part of a gradual expansion into new markets.
The travel industry is no stranger to subscription models. The hospitality sector, in particular, has been exploring this concept for several years. For instance, Accor and Marriott Bonvoy offer tiered membership levels that provide exclusive benefits, such as room upgrades, late check-out and elite status. This model has proven successful in fostering customer loyalty and driving incremental revenue. Likewise WizzAir aren't the only airline to offer subscription models either, with AirAsia's Explorer Pass offering unlimited flights with the ASEAN area.
Additionally, rental car companies like Hertz and Enterprise have introduced subscription services that offer unlimited or discounted rentals for a monthly fee. These programmes target frequent renters and business travellers seeking convenience and cost savings.
It remains to be seen which types of subscription and loyalty models will prove successful. Whilst the all you can fly models appear instantly attractive and let's be honest, they also make great headlines, the prepayment discount models seem a difficult sell for most consumers, albeit offering greater certainty for operators.
While subscription models hold immense promise, they also present challenges for both airlines and consumers. Airlines must carefully consider factors such as:
For consumers, the appeal of subscription models lies in the potential for cost savings and flexibility. However, concerns about blackout dates, restrictions and potential price increases may arise.
Elsewhere, Eurotunnel, which operates the Channel Tunnel, offered a popular Frequent Traveller scheme prior to the pandemic. This programme provided significant discounts to regular customers, effectively mirroring elements of a subscription model but instead of a subscription, frequent travellers could pre-purchase blocks of tickets at a discounted price. However, the onset of the pandemic and its subsequent challenges forced Eurotunnel to discontinue this offer.
The decision to withdraw the Frequent Traveller scheme highlights the complexities and risks associated with subscription-based models, particularly in the face of unforeseen circumstances. While such programmes can foster loyalty and generate recurring revenue, they can also expose businesses to vulnerabilities when faced with unexpected disruptions as lower margins on a pre purchased model could be eroded if overhead costs increase, the market changes or the calculations used on the level of use amongst customers turns out to be wrong.
While Wizz Air's subscription models represent a bold innovation, it's essential to consider the potential drawbacks and long-term implications.
While subscription models can be a valuable tool for airlines, they must be implemented carefully to ensure they contribute to a more sustainable and responsible future for the travel industry.
Wizz Air’s subscription models, while innovative and initially successful, have sparked debate about their long-term implications. The sell-out of the All You Can Fly pass raises questions about whether it was primarily a marketing gimmick or a genuine indicator of consumer demand. Despite this, it’s essential to consider the broader potential and challenges associated with subscription models in the travel industry, something enthusiastically embraced during the difficult period of the pandemic, but more cautiously considered during a time of inflation and uncertainty.
Is there an opportunity for destinations here? Possibly yes, but the environmental question may make that a challenging space to venture into for many DMOs. Whilst interrail passes have been successful for decades and have allowed visitors to explore more regions and places, staying longer thanks to the attractive pricing model, it doesn't seem as though a similar flight subscription will do that anytime soon.
Wizz Air has disrupted the airline industry once again with the introduction of its groundbreaking subscription models: All You Can Fly and MultiPass. These innovative subscriptions represent a significant departure from traditional pricing structures, challenging the status quo and potentially reshaping the future of air travel.
We thought we'd take a critical view on the different subscription and discount models deployed by Wizz Air. It's certainly true to say that even putting aside our own cynical view on whether or not these have been launched as PR stunts or serious product development, innovation, Wizz Air certainly stands apart for innovating when it comes to product and pricing.
All You Can Fly: Limited to 10,000 memberships. Subscribers can only book one-way flights with a 72 hours booking window. They're only allowed a carry-on bag, miss three flights (“no-shows”) and Wizz Air reserves the right to terminate the membership with immediate effect and without the option of a refund.
The question here is this. Is this a PR stunt and if so, does it risk damaging the brand's reputation due to the lack of available flights for people with this subscription, or is the publicity all part of the game?
MultiPass: Subscribers can choose one-way or return plans. They can add Priority and 20kg checked-in bag to the subscription, whilst added products cannot be removed from the plan once subscribed. They can only take 1 flight per month and these flights need to be booked 5 days in advance. Wizz Air discontinued the 6-month subscription plan, therefore once the subscription period ends, it automatically renews for the 12-month subscription program for the same country.
This certainly does seem like an interesting model. It targets frequent fliers who regularly go between specific destinations and perhaps goes some way to plugging flights and routes with spare capacity with passengers who are likely to travel when the right opportunity arises.
Wizz Discount Club: This offers a €10 discount on flights over €19,99. It is a model other airlines, such as easyJet, are employing with easyJet Plus, but WizzAir are instead focusing on building a more comprehensive offer, with different discount models for different markets, such as Italy where there's a model geared towards domestic flights.
Whilst this closest resembles a traditional loyalty scheme, it's range of tiers move from rewarding loyal customers with perks and incentives to giving discounts for those paying upfront. This model is being explored in other sectors too, such as with the Coffee and Sandwich chain Pret a Manger, who recently switched from offering an unlimited (5 Drinks) coffee subscription model to boost business after the pandemic, to a £10 a month model, leading to a 50% discount on drinks.
One observation that can be made with all discount propositions is they appear to be heavily skewed towards solo travellers. Another goal might also be aimed at increasing market share against the competition of Ryanair and Easyjet, whilst also eyeing up route development as part of a gradual expansion into new markets.
The travel industry is no stranger to subscription models. The hospitality sector, in particular, has been exploring this concept for several years. For instance, Accor and Marriott Bonvoy offer tiered membership levels that provide exclusive benefits, such as room upgrades, late check-out and elite status. This model has proven successful in fostering customer loyalty and driving incremental revenue. Likewise WizzAir aren't the only airline to offer subscription models either, with AirAsia's Explorer Pass offering unlimited flights with the ASEAN area.
Additionally, rental car companies like Hertz and Enterprise have introduced subscription services that offer unlimited or discounted rentals for a monthly fee. These programmes target frequent renters and business travellers seeking convenience and cost savings.
It remains to be seen which types of subscription and loyalty models will prove successful. Whilst the all you can fly models appear instantly attractive and let's be honest, they also make great headlines, the prepayment discount models seem a difficult sell for most consumers, albeit offering greater certainty for operators.
While subscription models hold immense promise, they also present challenges for both airlines and consumers. Airlines must carefully consider factors such as:
For consumers, the appeal of subscription models lies in the potential for cost savings and flexibility. However, concerns about blackout dates, restrictions and potential price increases may arise.
Elsewhere, Eurotunnel, which operates the Channel Tunnel, offered a popular Frequent Traveller scheme prior to the pandemic. This programme provided significant discounts to regular customers, effectively mirroring elements of a subscription model but instead of a subscription, frequent travellers could pre-purchase blocks of tickets at a discounted price. However, the onset of the pandemic and its subsequent challenges forced Eurotunnel to discontinue this offer.
The decision to withdraw the Frequent Traveller scheme highlights the complexities and risks associated with subscription-based models, particularly in the face of unforeseen circumstances. While such programmes can foster loyalty and generate recurring revenue, they can also expose businesses to vulnerabilities when faced with unexpected disruptions as lower margins on a pre purchased model could be eroded if overhead costs increase, the market changes or the calculations used on the level of use amongst customers turns out to be wrong.
While Wizz Air's subscription models represent a bold innovation, it's essential to consider the potential drawbacks and long-term implications.
While subscription models can be a valuable tool for airlines, they must be implemented carefully to ensure they contribute to a more sustainable and responsible future for the travel industry.
Wizz Air’s subscription models, while innovative and initially successful, have sparked debate about their long-term implications. The sell-out of the All You Can Fly pass raises questions about whether it was primarily a marketing gimmick or a genuine indicator of consumer demand. Despite this, it’s essential to consider the broader potential and challenges associated with subscription models in the travel industry, something enthusiastically embraced during the difficult period of the pandemic, but more cautiously considered during a time of inflation and uncertainty.
Is there an opportunity for destinations here? Possibly yes, but the environmental question may make that a challenging space to venture into for many DMOs. Whilst interrail passes have been successful for decades and have allowed visitors to explore more regions and places, staying longer thanks to the attractive pricing model, it doesn't seem as though a similar flight subscription will do that anytime soon.
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