Expert insight

Industry expert: The rise of premium economy

12 November 2018 by Jessica Gallimore

Smart businesses are increasingly opting for premium economy. Jessica Gallimore explains why.

Whether you're growing a business, you're feeling the pinch, or just thinking smarter about your travel budget, premium economy can be a savvy choice. When face-to-face meetings are necessary, then arriving at your destination feeling relaxed and firing on all cylinders is vital to ensure the best return on investment for the travel.

Historically, this might have been enabled by choosing to fly business or first class, but an expanding and evolving premium economy market now means travelling in comfort is becoming the more affordable and attractive option.

What is premium economy?

In its simplest form, premium economy bridges the gap between the business cabin and economy seats. Benefits differ between carriers but generally the main advantages of flying premium economy are wider seats and more legroom and perhaps an enhanced menu choice. (British Airways, for example, offers 18.5in seat width with 38in legroom, plus a three-course menu with options from the business class menu, served on china with linen napkins.) Some airline operators will give you a premium check-in service, lounge access and complimentary Wi-Fi too.

Premium economy tends to be offered on long-haul flights where an airline has configured seating to give more space than the economy class cabin. Sometimes it may be available to the short-haul traveller, but in those cases it’s more likely that, in a row of three seats, for example, the middle seat is left empty between two passengers, perhaps with its tray pulled down for serving drinks, to enhance the sense of space.

What is driving the market?

Airlines understand the importance to the corporate market of getting the best value from their travel programmes. Businesses that have previously had an economy only travel policy are now realising the benefits of stepping up to premium economy. The extra comfort and privacy to work means their employees are likely to feel more refreshed when they arrive. This is especially important if they are heading straight to a meeting shortly after landing or have crossed several time zones.

The growth of start-up businesses and young entrepreneurs may also contribute to the rise in popularity of premium economy. This is a generation that is used to low-cost carriers for frequent leisure travel and so are likely to be more flexible with their travel choices. Premium economy gives companies opportunities to be smart about the tickets they're buying: do employees need a business class flat bed for a daytime flight from the UK to the US east coast if they are planning to work? Perhaps a better option would be to fly in the premium economy cabin on the outbound trip and business class for the overnight return trip when employees need to sleep and arrive refreshed for the day ahead.

A growing trend

While I see a trend for airlines continuing to improve their premium economy class offering – particularly as they configure new aircraft – I don't see business class dying a death. Business class offers a particular service that is key for many employees, but premium economy definitely has a place within the business world, with an opportunity to evolve as airlines ramp up their edge over the competition. Lufthansa's new premium economy seat offers up to 50 per cent more space, while Air France has 40 per cent more than economy.

Innovation is key

However, premium economy is a particularly useful way for airlines to demonstrate their point of difference, particularly on routes where competition is plentiful. Low-cost Norwegian Air is ruffling feathers on its routes to New York. Its premium economy offering not only gives you 19in seat width, 46in legroom and inclusive food and drinks, but it also allows access to the Alitalia lounge at JFK or El Al's Art Lounge at Newark.

Virgin Atlantic has a strong premium economy offering with extra legroom – the leather seat is one of the biggest in its class (up to 21in wide with 38in seat pitch) – plus you get dedicated check-in and bag drop, priority boarding where possible, and you can put an extra bag in the hold. The airline also offers premium economy passengers an amenity kit, a choice of three meals, and a grab bar, where they can help themselves to snacks during the flight.

"Passengers want the extra comfort and perks that premium economy offers, plus consistency of service, irrespective of which type of aircraft you're flying," Rami El-Dahshan, head of TMC sales at Virgin Atlantic, tells me. "When I fly premium economy I like that it's a smaller cabin with fewer passengers, so you really feel you have the cabin to yourself."

El-Dahshan points to two types of business traveller attracted to premium economy.

"It is very popular with the SME business looking to optimise their budget," he says. "The second type of customers are from larger organisations, such as tech businesses, that have high-volume travel and an economy-only policy. Here, we see many individuals from all levels of the organisation upgrade themselves to the premium economy cabin using their miles to add value."

With Virgin Atlantic having recently launched Economy Delight, an economy cabin option that includes extra legroom, premium check-in and priority boarding, it is clear that airlines will continue to innovate in an effort to attract customers. But remember, possibly the number-one rule on getting great-priced tickets is to book in advance. And if you want some guidance on the difference between cabins, speak to your Capita Travel and Events specialist consultants – they’re there to help.

Jessica Gallimore is head of proposition – air and ancillary services, at Capita Travel and Events

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