The Godfather of Ancillary Revenue, Jay Sorensen is on LoadFactor
I had the pleasure of chatting with my friend and respected colleague Jay Sorensen earlier this year at the annual 2013 Freddie Awards. Jay has become a notable contributor on the airline practice of ancillary revenue and loyalty programs. I mention at the end of the interview that he is not only the “Godfather of airline ancillary revenue”, but he is also known in smaller circles as the “Father of the Cookie”. He earned this distinction by baking a tray of fresh cookies one day for the crew on a deadhead flight at Midwest Airlines when he was Head of Marketing. Seeing the crew enjoy the cookies and basking in the nostalgic aroma that filled the cabin, it occurred to him that it might be a novel idea to offer on scheduled flights. The rest was history, one of a brilliant marketing campaign that people remember to this day.
Many years ago when I started in the airline industry we used to delight at what we referred to as “non-transportation revenue” or “NTR” as my acronym-happy cohorts would call it. Loyalty programs were always the darlings of this type of revenue generation as managers figured out that we could leverage the equity in our miles and sell them to banks and partners for profit.
Back in 2007, nascent consultancy Airline Information founded by Chris Staab and myself, launched a conference to feed the industry’s growing hunger for additional revenues during a time at which jet fuel prices soared close to $4 per gal in 2008. The Ancillary Revenue Airline Conference (ARAC) as Jay called it, boldly addressed the growing need for add-on revenues beyond the sale of frequent flyer miles. The event was an immediate success, and much like the FFP Conference two years earlier, ARAC became the industry standard for learning ancillary revenue techniques, evaluating technology and making business deals.
Jay Sorensen was instrumental in creating a real identity for this event and was appointed its chairman. One of the main influences of Jay was using the term “Ancillary Revenue” to describe the most significant development in the industry since deregulation. The term had been used more in accounting documents up until that point when it became one of the most important buzz words that still carries steam today – even out lasting promising trends like as “GNE – GENIE” and “Customer Centricity” – yikes!