SpiceJet Strategy on Ancillary Revenue

Few weeks back we have read in various news articles on the SpiceJet decision of earning revenues from non passenger segments by selling branding opportunities to various companies on its boarding cards. They are also looking to add Insurance schemes for its passengers.

Now, SpiceJet have entered into a Joint venture with The UK based online retailer UnderFivePound.com. SpiceJet has decided to outsource its logistics and retailing operations to UnderFivePound.com and expects to make a foray into merchandising on board by early next year.

UnderFivePound.Com, through its Web site, sells a range of men’s, women’s and children’s clothing along with other items such as jewellery and houseware gadgets. Known for its ‘amazing’ offers, the Web site, as its name suggests, sells products for less than £5 and is known for its discounts and freebies.

Keeping the pricing of the merchandise in sync with the image of a LCC, SpiceJet expects to sell value-for-money items on board, to its customers. As Mr Sridharan said: “As we are a low-cost airline and believe in keeping down prices, our merchandise would be value-for-money items as well”.

Clearly, SpiceJet is bringing value for money deals to its customers not only by selling low cost airline tickets, but other products as well.

Worth trying … What say you?