Ryanair decided to end the subscription program that guaranteed discounts, free seat reservations and travel insurance to frequent customers. The company launched the service eight months ago, but adoption exceeded forecasts and costs exceeded revenue. The company low cost will maintain benefits only for those who have already joined, although it will not accept new registrations.
According to the British newspaper The Guardian, the program registered 55,000 customers, which allowed the carrier to raise 4.4 million euros. According to the same source, the benefits awarded cost more than 6 million euros, far exceeding the value obtained from subscriptions. This difference led to the cancellation of the initiative and the review of the commercial strategy associated with the program.
Eight months arrived to change the plan
The “Prime” service was presented with a set of advantages aimed at regular passengers. For 79 euros per year, subscribers could book up to 12 flights with discounts and no additional costs for seat assignments, in addition to travel insurance coverage included.
The newspaper writes that the volume of use of these advantages ended up generating financial losses for the company, contradicting the initial objective of attracting customers with greater regular travel.
“It costs more money than it generates. This level of subscription revenue does not justify the time and effort required to launch exclusive monthly sales of ‘Prime’ seats,” said Ryanair’s chief marketing officer, Dara Brady. The publication adds that this statement reinforces the conclusion that the program was not sustainable in the model presented, which led to its suspension.
Those who have already joined maintain benefits for another year
The same source states that the decision to end the program does not immediately affect those who already had an active subscription. These passengers will be able to continue to enjoy the benefits until October of next year. The company clarifies that new customers will no longer be able to sign up, thus marking the formal closure of “Prime”.
Explains that the program was launched in February this year in the European Union and the United Kingdom. The commercial package was intended to create a base of regular customers, but the cost-benefit ratio turned out to be unfavorable. The high number of repeat passengers resulted in higher spending on benefits than expected, which contributed to the decision to close.
Company maintains seasonal campaigns
With the end of the program, Ryanair maintains regular sales and seasonal campaigns, but removes a modality designed for frequent users from the offer. The evolution of commercial policy may be adjusted again in the future, but with no provision for direct replacement of the discontinued service.
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