HOW AIRLINE “JUNK FEES” AND ANCILLARY CHARGES IMPACT TRAVEL AGENTS: Strategies to Stay Ahead

Airline fees have evolved from a minor inconvenience for travelers to a significant challenge for travel agents and agencies. With billions generated annually, these charges create complexities for travel professionals striving to offer transparent pricing and exceptional service.

A recent Senate report highlights the extent of the so-called "junk fees." In this blog, we’ll tackle their impact on travel professionals, actionable strategies to mitigate their effects, and how you can turn these challenges into opportunities to strengthen client relationships.

Junk Fees or Ancillary Fees? What’s the difference?

Junk fees and ancillary fees are often used interchangeably, but there are subtle distinctions in how these terms are typically applied.

Ancillary Fees

These are additional charges for optional services or products that enhance the travel experience but aren't included in the base ticket price. Examples include:

• Checked baggage
• Seat selection
• Early boarding
• In-flight meals, Wi-Fi, and entertainment.

These fees, while sometimes frustrating, are considered legitimate because they reflect the cost of providing extra services.

Junk Fees

The term "junk fees" is more pejorative and often refers to charges perceived as unfair, hidden, or deceptive. These might include:

• Mandatory fees that are poorly disclosed during booking (e.g., fuel surcharges or surprise resort fees).
• Charges that don’t provide additional value (e.g., fees for printing boarding passes at the airport).

Junk fees are controversial because they erode transparency, making it difficult for customers (and agents) to understand the true cost of a product or service.

Key Difference

• Ancillary fees are optional and tied to services travelers can choose to add.
• Junk fees are often seen as non-optional, hidden, or poorly justified, creating frustration and distrust.

In practice, ancillary fees can become "junk fees" when they are not disclosed clearly or when they seem exploitative, which is why these terms sometimes blur.

The Challenges for Travel Agents and Agencies

1. Loss of Fee Transparency

Hidden fees make it difficult for agents to provide clients with clear, upfront trip costs, which can lead to misunderstandings or dissatisfaction.

2. Increased Operational Complexity

Agents must navigate varying airline fee structures and policies, adding time and effort to each booking. Two clients booking the same flight could face different fees, complicating cost comparisons. For group or family bookings, ensuring seating arrangements or addressing baggage needs becomes particularly burdensome.

3. Client Frustration and Trust Issues

Unexpected fees—such as paying extra to ensure families sit together—can erode trust in agents if clients feel they weren't informed upfront, and budget-conscious clients may be blindsided by these "extras." Agents who absorb these costs to maintain client relationships may face reduced profitability.

4. Competitive Pressure

Agencies without strategies to manage or mitigate these fees risk losing clients to competitors who offer clearer pricing or better guidance.

Strategies to Mitigate the Impact of Airline Fees

A. Increase Transparency with Clients

• Break Down Costs Upfront: Clearly outline what’s included in the ticket price and provide estimates for optional add-ons that may incur fees.
• Fee Forecasting: Offer estimates of additional costs, especially for services like baggage, seat selection, and inflight meals, so clients can make informed choices.

B. Optimize the Booking Process

• Technology Tools: Use booking platforms that provide a transparent view of airline fees to ensure clients see the total cost of travel, not just the base fare.
• Smart Comparisons: Compare airlines based not just on ticket price but on the value of included services, helping clients see the bigger picture.

C. Educate Clients

• Clarify Airline Fee Policies: Help clients understand how to avoid certain fees, such as choosing airlines that offer free carry-on luggage or skipping paid seat selection on short flights.
• Provide Tips: Encourage travelers to pack strategically to avoid baggage fees or select seats early when prices are lower.

D. Build Industry Relationships

• Work with Airlines: Negotiate partnerships for better deals or gain early access to detailed fee information.
• Advocate for Clearer Pricing: Engage with airlines to promote fair and transparent fee structures.

E. Offer All-Inclusive Packages

Bundle ancillary fees into upfront pricing to eliminate surprises, enhancing client trust and loyalty.

Opportunities for Travel Agents

1. Positioning as Experts

Agents who navigate the complexities of ancillary fees can stand out as trusted advisors, offering clients insights and guidance that add value to their travel experience.

2. Revenue Growth Through Fee Management

Charge a nominal fee for researching and managing ancillary charges, ensuring you’re compensated for your expertise and time.

3. Strengthened Client Loyalty

Transparency and upfront communication about fees build trust, encouraging repeat business and referrals.

Advocacy and Industry Collaboration

A. Stay Informed

• Keep up with legislative changes aimed at regulating airline fees, such as those highlighted in recent Senate reports.
• Share industry news with clients to position yourself as a proactive partner.

B. Collaborate with Industry Peers

• Join travel agent associations or forums to discuss strategies for addressing airline fees collectively.
• Advocate for standardized fee disclosures across airlines, benefiting both agents and travelers.

Looking Ahead: The Role of Regulation

The travel industry may see regulatory changes aimed at curbing misleading fee practices. Proposed measures include:

• Mandating Clearer Fee Disclosures: Travel agents could gain access to more upfront data, simplifying pricing for clients.
• Standardizing Taxation: Bringing ancillary fees under transportation tax regulations could discourage excessive price hikes.

By staying informed, you can position yourself as client advocates and experts in navigating this complex landscape.

Conclusion

While airline “junk fees” and ancillary charges add complexity to your role as an agent, the new DOT rule introduces even more changes that directly impact how refunds, cancellations, and fees are handled. 

Staying ahead of these updates is critical—not just for compliance but to position yourself as a trusted advocate for your clients.

By embracing transparency, leveraging the right tools, and staying informed about regulatory changes, you can navigate these challenges with ease, provide exceptional service, and build stronger client relationships.

Don’t let these changes catch you off guard.

Download the free guide from Travel Industry Solutions today to learn how the new DOT rule impacts your business and discover strategies to protect yourself and your clients in this ever-evolving landscape.

https://travelindustrysolutions.com/