Latest news with #luggagefees
Telegraph
16 hours ago
- Business
- Telegraph
How £120 airline luggage fees spiralled out of control
Have airline luggage fees gone too far? While anyone who's been within a mile of Stansted knows that budget airlines have steep baggage charges, the speed with which those fees have been escalating across Europe in recent years has been enough to give even experienced travellers a nasty surprise. At least that's the view of the European Commission, which is proposing new legislation to get the likes of Ryanair, easyJet and Wizz Air to standardise their baggage rules. The move is being cheered on by consumer rights groups who have spent years complaining that airline luggage fees are unfair. It's true that the red-tape enthusiasts in Brussels aren't known for their intelligent, pro-market approach. But on the other hand, there's no denying that the airlines have been taking liberties when it comes to their baggage charges – many of which have spiked several times since the pandemic. Look at Ryanair, which has tweaked at least one of its baggage charges every year for the past four summers. The end result is that the maximum charge for storing a 10kg suitcase has gone from £23.99 to £44.99 – an 88 per cent jump – and the maximum fee for a 20kg checked bag has risen from £39.99 to £59.99. Meanwhile, bringing a larger bag for hand luggage could cost you as much as £36 (up from £20 just four years ago). Given that the fees are per flight, you'll need to double those numbers if you want to bring the bag back with you. Because of how Ryanair's fees work – with the exact cost depending on the flight in question – it isn't easy to make a like-for-like comparison. But a quick search of some of the most popular routes this summer confirms that passengers are almost certainly paying more than they were before the pandemic. Looking at a flight from Stansted to Santorini on June 27, for example, a 10kg check-in bag will cost £28.99 one-way. But we can see from archived versions of Ryanair's website that the maximum fee for that service was £23.99 until just three years ago – so there's absolutely no way someone would be paying that much. Like the proverbial boiling frog, these bigger changes have happened bit by bit. In 2023, a 10kg bag was capped at £25 each way; in 2024, it increased to £29.99; this year, it jumped all the way to £44.99. In other words, if you've been thinking that your summer jaunt to Turkey has been going up in price in recent years, it probably isn't in your imagination.
Forbes
29-05-2025
- Business
- Forbes
Southwest Airlines Just Made A Costly Mistake In Consumer Psychology
Southwest Airlines is changing its brand identity as it begins charging for checked luggage. Starting Wednesday, Southwest Airlines began charging $35 for the first checked bag and $45 for the second. It's the end of an era for the airline that trademarked "bags fly free" and built decades of customer loyalty around that simple promise. Southwest executives have been under pressure to boost revenue by adopting bag fees, assigning seats, offering premium seating, and other practices used by their bigger competitors. For a spreadsheet-wielding accountant, these moves may make perfect sense. But, by violating fundamental principles of consumer psychology they might backfire in a big way. I couldn't find a chief behavioral officer at Southwest. If they do have a behavioral science team, Southwest executives almost certainly ignored their advice in implementing the new luggage fees. Behavioral economists know that people feel losses about 2-3 times more intensely than equivalent gains. Southwest customers aren't only seeing a $35 change in the cost of flying from point A to point B. Rather, they're experiencing the loss of something they already "owned" in their mental accounting. The well-established endowment effect says that people value something they currently own more than the same exact thing when it's not theirs. Yanking away the free bag benefit will impact Southwest's customers more than an equivalent fare increase. Robert Cialdini's consistency principle tells us people try to align their actions with their stated beliefs and with their past behavior. As humans, we are more likely to trust people who behave in a consistent way. Southwest literally trademarked "bags fly free" and built entire advertising campaigns around being different from other airlines. This major reversal is inconsistent with its long-established brand image. The change creates cognitive dissonance that damages trust far beyond the fee itself. When customers chose Southwest, they were choosing to avoid exactly this kind of nickel-and-diming. Now they're questioning what other promises might be broken next. Here's where Southwest's move gets particularly dangerous. Customers are 'anchored' to Southwest as the "no-fees" airline. That $35 charge feels disproportionately expensive because it's compared against their mental anchor of $0, not competitors' similar fees. (Anchoring works both ways. If, for example, an airline had charged $60 per bag for years, setting the price at $35 would seem like a bargain.) Even though Delta, United, and American charge similar amounts, Southwest's fee will feel worse because of the broken expectation. Southwest's own research paints a worrisome picture. In September, they projected gaining $1-1.5 billion from bag fees but losing $1.8 billion in market share. Despite this, they proceeded anyway, pressured by activist investor Elliott Investment Management's nearly 10% stake and the demand for immediate revenue increases. The early warning signs are already appearing. Social media backlash has been swift and brutal. One Instagram post about the change received over 14,000 replies – roughly 50 times their normal engagement. The sentiment isn't pretty. Mental Accounting Disruption. Customers budgeted Southwest trips assuming free bags. Now they're forced to recalculate total trip costs, potentially discovering Southwest is no longer the cheapest option when fees are included. Social Proof Cascade. Early complainers are triggering viral negative word-of-mouth. The "Southwest is becoming like everyone else" narrative spreads quickly because it violates their core differentiation. Choice Complexity. Southwest customers chose the airline partly to avoid decision complexity. Adding basic economy tickets, boarding priority options, and fee structures creates the exact confusion customers fled other airlines to avoid. Delta CEO Ed Bastian immediately recognized the gift Southwest handed competitors: "Clearly there are some customers who chose them because of that bags fly free policy. Now clearly those customers are up for grabs." Both American and Delta announced special, short-term status matches to try to siphon off Southwest's most loyal customers. United continued to offer its previous status match for Southwest flyers. Don't Break Your Core Promise. If your brand's fundamental value proposition is built around a specific customer benefit, changing it requires extraordinary care. Southwest's "bags fly free" was more than a policy, it was their identity. Understand Your Customers' Mental Models. Southwest customers weren't just buying transportation, they were buying simplicity and transparency. Breaking that mental model affects the entire relationship, not just the specific transaction. Calculate the Full Cost of Change. Southwest's own research showed the policy change would lose more in market share than it gained in revenue. When behavioral science principles conflict with financial pressure, ignoring the human aspects of your customers rarely works. Southwest projected $1.5 billion in annual bag fee revenue. But if their own research about losing $1.8 billion in market share proves accurate, this could become a textbook case of how short-term financial pressure can destroy long-term brand value. The real test isn't whether Southwest can collect $35 per bag. It's whether they can keep collecting anything at all from long-term, loyal customers who now have plenty of motivation to look elsewhere. It's too soon to tell how all this will shake out, but it's clear Southwest has placed a high-risk bet that they'll retain most of their customers despite the changed brand experience.
