United Airlines has spent years training passengers to pay more for better seats and amenities, and the strategy is paying off. As fuel costs climbed amid the U.S.-Iran conflict, the airline raised fares and leaned harder into “premiumization,” driving second-quarter operating revenue up 16% to $17.7 billion.
“Demand is strong,” United CEO Scott Kirby told Wall Street analysts on a conference call Thursday. “United has proven that our brand loyal strategy is working, and we’re using today’s environment to accelerate our investments in all aspects of the customer experience from nose to tail.”
United Airlines hasn’t quantified how much it’s increased fares, but flight search engine Skiplagged found that prices rose 35% for popular domestic routes and 15% for international destinations this summer, according to the New York Times.
Premium seats, premium strategy
Major carriers, most notably and successfully United and Delta Air Lines, have spent years persuading customers to pay more for tickets by investing in much improved services. The two airlines have built their businesses around higher-spending travelers, international networks, and lucrative loyalty programs.
