The hidden value in the Aer Lingus fare ladder

This is a guest and sponsored article by Wesley Jacobsson of EPIC Insights. It is the second in a double-bill covering EPIC’s research in the Irish aviation market and covers airline fare structures. It shows that while Aer Lingus has more than enough ancillary revenue options (and does not need any more), the way the airline presents these options to consumers may need work. What makes this work distinctive is that it focuses on pure Pricing and product design rather than Revenue Management and optimisation. I thought you would like to hear their results. You can visit EPIC’s website here – www.epicinsights.io – now, over to Wesley… Advertisement: Core finding Aer Lingus has a missed fare-ladder opportunity. The current Economy architecture leaves value trapped between an underpowered Plus Tier and a scarce AerSpace product. Rebuilding the middle of the ladder, pricing AerSpace more assertively, and treating guaranteed seating together as a targeted booking-level add-on can unlock meaningful ancillary revenue without simply adding more products. Setting the stage Ancillary revenue has become one of the most closely watched lines in airline commercial strategy. The seat, the bag, the boarding, the flexibility, the food: each represents a distinct decision a passenger makes, and a distinct pricing opportunity for the carrier. How those opportunities are structured matters as much as whether they exist at all. Lock features inside higher fare tiers and some passengers who would happily pay for one benefit will not upgrade to reach it. Sell them as standalone add-ons and you risk pulling passengers away from the tier upgrades that carry higher margin. Both approaches can work. Both can also leave revenue uncaptured, either by putting the right feature in the wrong place or by pricing it in a way that misreads what passengers will actually pay. The only way to tell which is which, is to stop assuming and start measuring: to put real features, real bundles, and real prices in front of real passengers and watch what they trade off. For Aer Lingus Economy flyers, EPIC did that in two stages. Our earlier MaxDiff study answered a deliberately narrow question: when price is removed from the comparison, what do Aer Lingus Economy flyers prioritize? The answer was consistent. They reach for certainty rather than novelty, favoring the features that take an uncertain part of the journey and make it feel handled: seat selection, the assurance that a group will sit together, flexibility, and priority boarding. Assurance was the only benefit type to score above average. Oliver adds: Airline Revenue Economics readers were the first to see this analysis – you can read the original article here: https://revman.substack.com/p/what-do-aer-lingus-Economy-flyers That study held price constant by design, which is how we were able to isolate pure preference. It told us what flyers prefer. It could not tell us what that preference is worth, how the features should be packaged, or what happens when a real fare is attached and choosing one feature means giving up another. It also surfaced a commercial gap that sharpens the point. Two of the features Economy flyers rank highly are absent from the fares most of them actually buy. Guaranteed seating together is not offered as a distinct product. Priority boarding is concentrated at the top of the ladder in AerSpace, where only four seats are available per flight. Part of what we set out to measure here is the value that placement leaves uncaptured. This paper picks up exactly where the MaxDiff left off. We put price back into the decision and forced real trade-offs. What we tested EPIC ran a choice-based conjoint study with Irish Aer Lingus flyers, modelling how simulated demand distributes across different ticket configurations. To understand what drives ticket choice, we tested the range of features and levels below: The levels tested are based on what Aer Lingus currently offers in its Saver, Plus, Advantage, and AerSpace tiers, with the addition of two novel features which were found to be desirable in the MaxDiff: “guaranteed seating together for those on the same booking, assigned by Aer Lingus with no advance individual selection” and “priority bag delivery”. Aer Lingus Economy fare tiers as presented in the booking flow. Note: Price was conditional on the seat product, so the total fare a respondent saw was realistic for the seat in front of them. Base fares ran from about €60 for standard-seat configurations to about €100 for the front-row product. Seven price points, with 30% steps from one to the next, were tested for each product. Methodology We surveyed 287 Aer Lingus Economy flyers in Ireland, recruited with quotas on age, income, and travel purpose to mirror the airline’s Economy base. Respondents qualified only if they had physically boarded and flown Aer Lingus from their local airport in the past 12 months to a European destination. Each respondent completed 10 choice tasks. In every task they saw three configured fares plus a “none of these” option, so the model captures not only which fare wins but whether a respondent would buy at all. The choice task was tailored to the respondent’s stated travel context and frequent route pattern. For example, respondents who primarily flew for business saw a business-trip framing, while leisure flyers saw a leisure-trip framing. The image below is illustrative rather than a single universal task. Illustrative conjoint choice task shown to respondents. Alongside the conjoint, EPIC ran Gabor-Granger price tests on individual add-ons, including priority boarding, flexible changes, fast track security, lounge access, and guaranteed seating together. This gives a direct euro willingness-to-pay read to compare against the conjoint-derived package-based values. The Gabor-Granger exercise tested one feature at a time as a standalone add-on. Respondents evaluated whether they would buy the feature at specific price points, and the standalone Willingness To Pay values reported later are the price points implied by those accept/reject curves. They are not the same construct as conjoint indifference values, which measure the feature inside a bundled fare. Illustrative Gabor-Granger task shown to respondents. The add-ons selected for Gabor-Granger testing were not chosen arbitrarily. Priority boarding, flexible changes, fast track security, and lounge access are all features that scored strongly in the MaxDiff and are sold as standalone ancillaries by other airlines, but are not consistently monetized as simple standalone add-ons across the relevant Aer Lingus Economy booking path. Conjoint interpretation note: Throughout this article, “preference share” means simulated share of choice within the conjoint model. It is a disciplined way to compare packages, prices, and trade-offs, but it is not the same as an observed booking forecast. Actual bookings will also depend on availability, load factor, booking window, channel, competitor pricing, loyalty and corporate behavior, schedule, seasonality, and revenue-management controls. The results should be read as directional commercial signals to validate in market, not as guaranteed demand. What the preferences say Relative importance shows how much each attribute drove choice within the tested feature and price ranges. Ticket price was the single largest lever at 25.7%, as expected once a real fare is in play. What matters more for offer design is that non-price attributes together accounted for roughly three quarters of the decision. Bags carried the most non-price weight at 18.6%, followed by airport experience at 13.5%, in-flight dining at 12.7%, seats at 11.6%, and flexibility at 9.6%. Checked bag priority (6.1%) and standby for an earlier flight (2.2%) sat well behind, with standby barely registering as a decision factor at all. Figure 1. Relative feature importance. The importance ranking reflects the MaxDiff’s central finding. The attributes that drove choice most strongly in the conjoint map onto the benefit types that performed best in the previous study. Bags, seats, and flexibility are predominantly Assurance-category benefits, resolving specific journey uncertainties before the passenger boards. Airport experience blends Assurance, through priority boarding, with Ease, through fast-track security and lounge access, and collectively sits third in importance among non-price attributes. In-flight dining, the study’s primary Indulgence attribute, sits mid-table despite having five levels to drive variance. Standby, the most contingent and narrowly applicable feature tested, barely registered at 2.2%. The feature-level preferences further confirm the MaxDiff findings. Across every attribute, levels that resolve uncertainty outperform levels that simply elevate the experience. In bags, the fuller carry-on-plus-checked combinations lead not because they are premium, but because they resolve the pre-departure anxiety of having everything handled. The most striking illustration is in Seats: guaranteed seating together, which provides the assurance that your whole party will not be split up, and included seat selection rank highest, while the front-row AerSpace-style product scores lowest despite being the most premium physical option. It is worth noting that in this conjoint the front-row product was anchored to a higher base fare to reflect its real-world pricing, so its lower preference score reflects a combination of price sensitivity and product preference rather than rejection of the seat itself. Within flexibility, cash refund leads over less uncertainty-resolving credit or flight-change options. Figure 2. Relative feature-level preference. Commercial read: None of this is the commercial answer on its own. It confirms the direction the MaxDiff established and tells us which levers are live. The questions that matter – what each feature is worth in euros, which bundles to build, what to charge, and whether unbundling captures new demand or simply cannibalizes fare-tier upgrades – require the simulations we turn to next. Behaviour under the current ladder We simulate the baseline market using an illustrative current-fare benchmark based on Aer Lingus pricing using the average of 18 one-way fare pulls from Dublin to LHR (London Heathrow), BCN (Barcelona), and AMS (Amsterdam) on Tuesdays and Fridays in March, July, and November. This benchmark is not intended to represent Aer Lingus’s full pricing system, rather, it gives the conjoint simulator a realistic, transparent reference ladder against which alternative packages and prices can be compared. The working ladder is Saver €90, Plus €135, Advantage €170, and AerSpace €185, with steps of roughly €45, €35, and €15 between tiers. Under these conditions, AerSpace pulls 48% simulated preference share, Saver follows at 26%, Advantage at 14%, and Plus collects 7%. The signal is clear, but it should be read in the right context. When Economy passengers see the full premium ancillary bundle clearly priced and described, a large share gravitate to it, pointing to real appetite for the AerSpace proposition at the modelled price. At the same time, this is an unconstrained choice simulation, not a booking forecast. A top tier priced only modestly above Advantage would be expected to attract a high share when availability is unlimited, so the 48% should be interpreted as appetite at the tested ladder rather than evidence of network-wide demand at any price. That distinction matters because AerSpace is a four-seat product on a 174-seat aircraft. On any given departure, at most four passengers can buy it. For the remaining 170 Economy seats, the practical ladder is Saver, Plus, and Advantage. The next simulation therefore removes AerSpace from the choice set to show how demand redistributes when the premium cabin product is sold out. The three-fare reality We re-ran the simulation with AerSpace removed from the choice set, holding all other prices and packages constant. Given the fact that there are only four AerSpace seats per flight, this shows how consumers who would have selected AerSpace distribute among other tiers when it is not available. Figure 3. Simulated preference share under three scenarios. Panel B shows the result. Saver climbs to 42%, Advantage to 37%, and Plus collects approximately 15%. The market becomes bimodal. Displaced premium demand splits between the price floor and the loaded mid-premium tier, with Plus collecting only a fraction of either. The middle of the ladder is hollow. This is not primarily a price-sensitivity issue. Passengers willingly pay €80 more to step from Saver all the way to Advantage. It is a package-design issue. The €45 step from Saver to Plus buys advance seat selection, a 20kg checked bag, and standby. The next €35 step to Advantage unlocks lounge access, fast track at Dublin, and the flexibility suite of no change fee, refund voucher, and cash refund eligibility. The geometry of the ladder invites passengers to skip the middle entirely. Rebuilding the ladder The diagnosis points to a problem deeper than Plus alone. The current ladder has tiers that fail to earn their place relative to each other, with steps small enough that passengers can rationally jump from Saver straight to Advantage. EPIC used the conjoint utility scores to rebuild all three Economy tiers with intentional, utility-grounded differentiation from one tier to the next. Plus gains its first airport-experience benefit through fast-track security. Moving from “No extras” (utility 9.7) to “Security” (utility 11.5) is a 1.8-point lift, the largest single improvement available without devaluing other higher-fare-tier benefits such as lounge access and priority boarding through crowding. This gives Plus a real reason to exist between Saver’s no-frills floor and Advantage’s full premium bundle. Advantage receives three changes that distinguish it from the rebuilt Plus on dimensions Plus does not touch. Checked bag priority and light catering (snack plus drink) are small but useful utility lifts that broaden the premium proposition. The seat benefit is extended from “advanced selection of standard seats” to “advanced selection of standard and extra-legroom seats.” AerSpace also gains checked bag delivery priority and maintains a clear premium step above Advantage with the empty middle seat and priority boarding. Panel C of Figure 3 shows the result with AerSpace held out of the choice set, the operational reality for most passengers. The bimodal pattern breaks. Plus captures 25% simulated preference share, ahead of Saver at 23%. Advantage holds 47%, capturing the bulk of displaced premium demand cleanly. The middle of the ladder is doing its job, and so are the tiers around it. Revenue contribution from the rebuild Figure 4. Modelled per-flight revenue, current vs. rebuilt ladder. Figure 4 compares modelled per-flight revenue. We treat AerSpace as a fixed contribution of €740 per flight (four seats at the Aer Lingus-referenced avg of €185), since its supply cap means changes at this tier do not scale, and we model the remaining 170 Economy seats using the three-fare simulation that most passengers actually face. On this basis, the current ladder produces approximately €21,260 per flight and the rebuilt ladder produces approximately €23,470, an uplift of €2,210 per flight, or 10.4%. Revenue interpretation note: These are modelled gross fare-revenue scenarios from the conjoint simulator, not an audited P&L forecast. The figures assume a 174-seat A320 with four AerSpace seats and 170 remaining Economy seats at modelled share. They should be read as directional revenue potential to validate through route-level pricing tests, not as guaranteed uplift. Pricing optimisation With the rebuilt ladder in place, each fare’s price-elasticity curve was examined for pricing optimisation opportunities. Saver supports a modest increase from €90 to just under €100, with share declining only slightly from 23.19% to 21.92% while revenue continues to rise. Plus remains at €135, as further increases cause the share loss to outweigh the price gain. Advantage moves from €170 to €177, indicating some remaining pricing headroom within the rebuilt package. AerSpace is treated differently because supply is capped at four seats per A320 flight. The question is not which price maximizes share, but which price still supports sell-through. At €280, the highest price tested, AerSpace still attracts 22.96% simulated preference share, well above the 2.3% threshold needed to fill four seats. This does not prove the ultimate market-clearing price. It does show that, within the tested range, AerSpace can be priced materially higher while still supporting sell-through of the current four-seat supply. At €280, AerSpace contribution rises from €740 to €1,120 per flight. Combined revenue impact Figure 5. Cumulative modelled per-flight revenue across rebuild and pricing stages. Figure 5 shows the cumulative modelled per-flight revenue across the three stages. The current ladder delivers approximately €21,260 per flight. The package rebuild lifts this to €23,470, an uplift of €2,210, or 10.4%. Layering pricing optimisation on top adds a further €1,335, bringing total modelled per-flight revenue to approximately €24,805. The cumulative uplift from current to fully optimized is approximately €3,545 per flight, or 16.7%. This optimized total prices AerSpace at its highest tested price which works out to approximately €1,120 (four seats at €280), not the €740 baseline used in the rebuild stage. Conclusions on package and price optimisation Three opportunities sit alongside the optimized ladder and are worth flagging before we move on to other commercial questions. AerSpace has scope to expand operationally. The four-seat capacity of AerSpace is a configuration choice, not a structural constraint. Each additional row of AerSpace replaces six standard Economy seats. At the optimized AerSpace price of €280, the incremental revenue from one additional row works out to approximately €280 per flight after accounting for the displaced standard seats: four new AerSpace seats at €280 add €1,120, against six standard Economy seats lost at the optimized blended yield of approximately €140 per seat. Two additional rows would add roughly €560. The expansion is bounded by demand, which at €280 supports many multiples of the current four-seat capacity. The case for additional AerSpace rows should therefore be tested by route, season, and load factor rather than treated as a network-wide conclusion. AerSpace has pricing headroom. The conjoint tested AerSpace prices up to €280, and preference share at that price remained well above the threshold needed to sell through the current four seats. The evidence supports a higher price than our highest-tested price point for the existing AerSpace supply. Identifying this exact price point will require additional testing. Operational availability must be station-specific. Fast track security, lounge access, checked bag priority, catering, and standby are not purely digital benefits. They depend on airport availability, lounge and security capacity, ground-handling execution, flight frequency, disruption conditions, and cost to serve. The conjoint identifies which benefits passengers value; implementation should be validated by route, airport, season, load factor, and operational feasibility. The optimized ladder should be validated against the competitive set. The conjoint does not observe competitor pricing on the booking platforms where Aer Lingus competes most directly with other carriers. A follow-up exercise comparing the optimized Aer Lingus ladder against published competitor fares on common routes would be a valuable validation step. Further optimisation opportunities The package and pricing work above addresses the existing four-tier ladder. The next question is what to do with the specific reassurance benefits the MaxDiff surfaced as valuable, but that are not always easy for Economy passengers to buy directly. Guaranteed seating together is the clearest case, because it ranked strongly when price was removed and does not currently exist as a distinct Aer Lingus product. Priority boarding, fast track security, and lounge access raise a different question: they already have a role inside higher-value offers, but may also have value as targeted add-ons if priced carefully. Pricing the unbundled features Each feature was valued two ways. Gabor-Granger gives a standalone willingness to pay: the price a passenger accepts for the feature on its own. The conjoint gives an indifference price: the gap at which two otherwise identical fares draw equal share, which is the feature’s value inside the fare against its base level. Guaranteed seating together is the one tested feature that clearly does not belong in a fare at all. It is a booking-level benefit, a single purchase that seats a party of up to four together, with no natural home inside any one passenger’s ticket. The two readings show it plainly: as a ticket attribute it is worth €14, but offered as a standalone add-on it draws €30. It earns more as an add-on because that is its natural form: one charge to the booking rather than a group benefit bolted onto an individual fare. The other four already live in tiers. Three of them read consistently across both methods, all landing in the high teens to low twenties: priority boarding at €20 standalone and €23 in-package, fast track at €20 and €23, and lounge at €25 against €19. Two independent methods agreeing at around €20 apiece confirms these are valued benefits rather than filler, which is what justifies reserving them for the premium tiers. None needs to be unbundled, but offering any as an add-on is a targeted way to reach passengers who will not take the full tier step. Flexible changes are the reversal. As a fare attribute, the level scores €8 below standard change rules, which looks backward until you read the level as shown: “no change fee, fare difference applies.” Inside a fare, that wording can still feel like a cost because the fare difference applies. Presented on its own with a price attached, the same flexibility is clearly an upgrade and drew €20. The commercial value is messaging-sensitive: any monetisation should present it alone and lead with a clean change-without-fees message. As specified in the fare, it is the weakest candidate. Figure 6. Standalone willingness to pay against in-package indifference price, by feature. Business travel as a pricing lens Airline fares are not sold to an average passenger. They are sold in context. Carriers already see signals at the point of purchase that can shape how the same fare ladder is presented: route, day of week, booking window, party size, channel, and travel context. The commercial question is not whether every traveller needs a different product. It is whether visible demand signals can tell Aer Lingus where the existing ladder has more pricing headroom. Business travel is the clearest example. Because the choice tasks were tailored to respondents’ stated travel purpose, the business-traveller cut reflects business-led decision-making rather than a generic leisure frame. The cut does not point to a separate fare architecture. It points to Advantage as the right place to capture incremental premium yield when the context is more business-led. In other words, the opportunity is not another fare. It is a sharper read on where the premium tier can carry a higher price. In the total-sample price optimisation, the rebuilt ladder lands at Saver €100, Plus €135, and Advantage €177. In the business-traveller cut, Saver and Plus remain at the same optimized prices, while Advantage can move to €185 before the revenue curve turns down. That is the central finding. Business travellers do not require a different ladder, but they give Aer Lingus more permission to price Advantage assertively. This confirms the MaxDiff finding that business travellers place a higher value on a full-service Economy product. The implication is disciplined. Advantage should be treated as the natural business-relevant tier, not because business travellers need a bespoke product, but because they are more tolerant of the price attached to a credible premium package. The messaging should emphasize the parts of Advantage that matter most in a business context: airport control, flexibility, priority handling, and a more complete Economy journey. For Aer Lingus, the next test is operational and commercial rather than conceptual. Advantage pricing can be more assertive where business demand is denser, such as business-heavy routes, weekday departures, shorter booking windows, solo travellers, or channels where corporate demand is more likely. The point is not to proliferate fare products. It is to use business intent as a practical filter for when the optimized ladder can work harder. Conclusion The conjoint does not replace the MaxDiff. It completes the commercial sequence. The MaxDiff showed which features Aer Lingus Economy flyers value when price is removed from the decision. The conjoint shows what happens when those same features are placed inside real fare structures, real price points, and real trade-offs. The answer is not that Aer Lingus needs more ancillary options. It is that the current fare ladder can work harder. Plus needs a clearer role, Advantage can carry more premium demand, AerSpace has pricing headroom within the tested range, and some benefits are better monetized as targeted add-ons than locked inside fare tiers. The opportunity is to build a sharper Economy architecture: one that gives passengers clearer reasons to trade up, captures demand that currently sits outside the ladder, and validates the modelled upside in market. Key takeaways • The MaxDiff created the right hypothesis. Passengers prioritize certainty over indulgence. The conjoint confirms that this direction still matters when price and fare trade-offs are introduced. • The current ladder leaves value trapped. Once AerSpace is removed from the available choice set, the market becomes bimodal, with demand pulled toward Saver and Advantage while Plus remains structurally weak. • The rebuilt ladder strengthens the architecture. Rebuilding the three main Economy fares gives Plus a clearer role and lets Advantage capture premium demand more cleanly. The rebuild lifts modelled per-flight revenue from approximately €21,260 to €23,470, an uplift of €2,210, or 10.4%. • Pricing optimisation adds further headroom. Layering pricing optimisation onto the rebuilt ladder lifts modelled revenue to approximately €24,805 per flight. That is a cumulative modelled uplift of approximately €3,545, or 16.7%, versus the current ladder. • AerSpace is scarce and has pricing headroom. At the highest tested price of €280, AerSpace still attracts preference share well above the current supply threshold of four seats. That supports higher pricing for the current supply, while any row expansion should still be tested by route, season, load factor, and competitive context. • Add-ons should be selective, not automatic. Guaranteed seating together is the clearest standalone opportunity. Priority boarding, fast track security, and lounge access also have value, but they should be priced carefully: high enough to capture passengers who would not buy a premium fare, without undercutting the tiers those benefits also help sell. • Business travel is a pricing lens, not a separate ladder. Business travellers support more assertive Advantage pricing, with the optimized Advantage price moving from €177 overall to €185 in the business-traveller cut. • Modelled upside needs market validation. The conjoint is strong for comparing relative offer architecture, but the revenue numbers should be validated against live booking behaviour, competitor fares, operational costs, route mix, and revenue-management constraints. You can visit EPIC’s website here – www.epicinsights.io