business model of ryanair

Business Model of Ryanair

by Ruslan Kakenov

Flight: Barcelona - Rome

Company

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Iberia €137 €97 €112 €97 €112

Alitalia €137 €137 €137 €137 €137

Ryanair €89 €69 €69 €56 €56

Total scheduled passengers carried in 2010, millions

How does Ryanair make profit at lower

prices?

Ryanair’s Business Model

Lower the costs

Optional fees

E-commerce & advertising

Lower the costs

Standardized aircrafts (Boeing-737)

Contracting out of services

Airport charges

Staff costs and productivity

Marketing costs

Airline&rail fares from Barcelona

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Traditional airlines Low cost airlines 2002 rail fares

Optional fees

Priority Boarding €5

Admin fees €6

Add bags €15-45

Infant fee €20

Musical equipment €40

Sports equipment €40

Change Flight €50

Name change €110

If someone wanted to pay £5 to go to the toilet I would carry them

myselfMichael O’Leary, Ryanair CEO

E-commerce & advertising

Hertz car rental

In-flight sales

Travel related e-services

Travel related e-services

Accommodation

Insurance

Bus&train tickets

Cruises, golf etc

Drawbacks of the model

Unprotected employees

Low comfort & fair customer

service

Much reliance on ancillary revenue

Legal issues

Questions