Retail

Subscriptions As The Ticket To Filling Empty Airplane Seats

Air Travel

Airlines often face a common dilemma when it comes to some of their routes: How do they fill empty seats and ensure their flights are fully booked? Rama Poola came to a possible solution after flying around the world and noticing that flights aren’t always sold out. He created a subscription service called SkyHi that provides flyers with access to deals on routes that aren’t at capacity.

“There are a lot of empty planes,” the SkyHi CEO told PYMNTS, “[and] we want those planes to be more efficient.”

The service charges customers a flat monthly fee for access. In return, flyers have access to flights that leave within 10 days. When a consumer finds a flight he likes, he can book it for $35 — as long it is within a radius of 1,500 miles. SkyHi is limited to five one-way flights each month, though, meaning consumers cannot buy an unlimited number of trips through the platform.

Beyond filling empty seats, the service provides airlines with customers that might spend money on other products or services. Travelers can purchase a number of upsells with the airline once they have a confirmation, including extra baggage or perhaps an extra legroom seat.

The Business Plan

SkyHi focuses on offering shorter flights from New York to Chicago or New York to Miami. These routes have many empty seats, due to the sheer number of flights between the hubs, and any number of empty seats per plane multiplied by many flights creates a larger supply.

“Airlines are good at planning, and that they know that it’s a heavily trafficked route,” Poola said. “However, there are just so many planes running that route that there a lot of empty seats. If you have 50 planes going up and each one has 10 [empty] seats, there’s a lot of excess inventory.”

SkyHi’s bread and butter is leisure travelers, particularly millennials between the ages of 23 and 27. That population tends to have disposable income, lives in larger cities and has largely gone untargeted by airlines, Poola said. The company is starting to work with influencers to create content to attract this segment and others, and the SkyHi platform is already benefiting from word-of-mouth referrals.

Beyond leisure travelers, Poola is starting to see small business owners using his service, often traveling to meet with clients, and that freelancers such as photographers or videographers are traveling on SkyHi, too. Overall, he sees an interesting trend: Leisure and business travel appears to be merging.

“It is becoming a real thing where people are sort of living lives where they’re constantly both working and leisure travelers, which is great for us,” Poola said, adding that he’s starting to see this with his target demographic.

The Flight Path Ahead

SkyHi currently works with international carriers such as Alitalia and Lufthansa, but it doesn’t yet offer long-haul transatlantic flights. Its customers can use the platform to book air tickets for hops within Europe once they cross the pond, however. One such customer has been using SkyHi for trips around the continent, others have booked air tickets to get to the Sundance Film Festival and Poola, himself, has used the service to fly to South By Southwest.

While SkyHi requires each traveler to have his or her own subscription, the company realizes that people often don’t travel alone.

“We’re thinking about what a companion pass would look like,” Poola said. He has also considered offering tickets for longer distances — say, Los Angeles to New York — and wants to encourage “a world where people do have more travel in their life and it’s super easy.”

Travel is already relatively seamless for Poola, as he lives in New York City and has a monthly Metro Card. He doesn’t think about how many times he swipes that card, and instead simply travels where he wants to go. Poola wants his customers to have a similar mindset when it comes to using his service for air travel, aiming to make SkyHi the Metro Card of the skies.

——————————–

Latest Insights: 

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. The July 2019 AML/KYC Tracker provides an in-depth examination of current efforts to stop money laundering, fight fraud and improve customer identity authentication in the financial services space.

TRENDING RIGHT NOW

To Top