Ancillary Revenue Definition

Ancillary revenue refers to revenue generated from goods and services that differ from or enhance the main services or product lines of a company. Ancillary revenue has become an important financial component for low cost carriers in and is now being adopted by leading carriers throughout the world. Within other sectors ancillary revenue is referred to as incremental revenue. Ancillary revenue programmes enable brands to differentiate their proposition, gain a competitive advantage while generating a new and recurring revenue stream.

Aside from A la care features, ancillary revenue activities also includes the commissions earned from third party products and services such as airlines selling hotel accommodation, car rental and travel insurance.  Other examples include annual fee paid membership packages through reward and promotional platforms such as online shopping.  These types of programmes enable brands to develop loyalty building initiatives that deliver detailed customer insight, further strengthening the brand’s long-term relationship with the customer.    

To ensure success of ancillary revenue initiatives, programmes should be build around existing marketing strategies and fit with customer profiles.  Programmes can be implemented with existing loyalty and membership programmes to increase loyalty and retention. Find out more about ancillary revenue programmes offered by Collinson Latitude

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