Offers, Loyalty, and AI Lead the Way
Airline tickets were once much more standardized: everyone got a seat, a meal (depending on flight duration), and a checked bag, whether they needed it or not. Fast forward to today, and airline retail is going through one of the most significant transformations in its history: Offers & Orders. The airline industry is evolving from homogeneous ticket sales and limited add-ons into a more dynamic, often à la carte model that allows airlines to craft precise, optimized offers for every traveler.
Much like Apple changed the game by elevating their digital retailing, leading airlines have now realized that the purchase experience matters nearly as much as the flight itself. Armed with modern tech, better data and more sophisticated AI, carriers will soon craft more relevant offers across marketing channels, during the shopping experience, within loyalty programs, or post-booking.
Six weeks into 2026, four major developments are already defining this new era of precision airline retailing: a focus on offers as the revenue driver of airline retailing, context-driven offers, smarter loyalty programs, and AI-powered search.
Offers Take Center Stage as the Revenue Engine of Airline Retailing
For decades, airlines have operated in a world where the order, the eventual PNR and ticket, was the organizing unit of airline commerce. But the shift toward modern retailing has made one point increasingly clear: revenue isn’t created at the order stage. It’s created at the offer stage. The offer is where airlines shape demand, communicate value, differentiate the experience, and influence what a traveler will ultimately purchase.
So far in 2026, leading carriers are refocusing their modernization efforts around this reality. Offers, not orders, represent the strategic battleground where airlines can grow revenue, improve conversion, and build brand loyalty. Every personalized bundle, dynamic fare, or context-aware ancillary recommendation lives within the offer. This is where AI and optimization disrupt the traditional, seat-centric model and unlock significantly more revenue potential.
The industry’s gradual shift toward orders is still essential. Orders promise simplified back-office processes, cleaner servicing, and better downstream fulfillment. But those benefits alone rarely justify the investment required. What does justify the investment is the ability to support richer, more flexible offers that can only be fully realized when orders modernize the retail architecture behind them.
As airlines evolve toward offer, order, settle, deliver, we’re already seeing the focus move upstream, where demand is shaped, optimization happens, and the real revenue opportunities live. By treating offers as the primary economic unit of the retailing experience, carriers can unlock new revenue streams today while laying the foundation for next-generation order management tomorrow.
From Tickets to Tailored Offers
When low-cost carriers came onto the scene, fares became unbundled. They began offering ancillaries, such as checked bags or meals, à la carte for an additional fee. Legacy airlines followed suit, introducing basic fare options and exploring the value of unbundled ancillary offerings. In 2024, global ancillary revenue reached $148.4 billion, accounting for nearly 15% of airline revenue worldwide. The unbundling trend is expected to continue well into the near future.
Airlines are now reaping the benefits of creating more holistic offers that cater to travelers’ needs based on shopping context and price elasticity. The goal is no longer simply to get someone from point A to point B but to design an end-to-end experience that feels tailored and keeps them coming back for more.
Early in 2026, carriers are moving beyond traditional revenue management (RM) and static ancillary strategies toward truly dynamic, AI-powered offer optimization. Traditional RM and pricing models, long built around fixed class codes, are shifting toward continuous pricing, which allows airlines to adjust fares more precisely. This model allows for new revenue opportunities while offering travelers smoother, more consistent price steps.
Ancillary strategies are evolving as well. Instead of relying on fixed bundles or standard add-on fees, airlines can now combine the “right to fly” (the seat itself), with options such as seat selection, early boarding, baggage, lounge access, and even destination experiences in a far more contextualized way. These tailored packages won’t just increase ancillary revenue; they’ll deepen engagement and help airlines better anticipate and meet customer expectations.
At the same time, the unbundling of airline products will continue. This dual shift – smarter bundling and deeper unbundling – is becoming more visible in early 2026 booking patterns. This trend began years ago with checked bag fees but in the future airlines will offer travelers an even wider range of options such as meal upgrades, seating zones, fast-track security, and carbon offsets. These options give flyers greater control and flexibility over what they deem worth buying but it also complicates the shopping process. As these strategies expand in 2026, each airline will have different offerings that impact the final price, making the comparison of value across airlines more complex.
Loyalty Reinvention
Airlines are also rethinking the way their loyalty programs work. Spend-based earning models and flexible redemption options are replacing traditional distance-based programs. Earning “miles” is now an artifact from the past. Meanwhile, loyalty points are becoming flexible currencies in their own right. Miles may now be used to cover a baggage fee, purchase in-flight Wi-Fi, or pay for food and drinks on the plane, in addition to redeeming them for flights, as was their traditional use. Outside of in-air purchases, some programs even allow points to be applied to the annual airline credit card fee or to retail purchases made outside of strictly travel-related expenses.
As 2026 unfolds, airlines that simplify how travelers earn and redeem rewards while increasing customization and transparency are better positioned to stand out as trusted, data-driven retailers.
AI and Smarter Search Shape the Journey
Artificial intelligence is already becoming a defining feature of airline retailing. Already in early 2026, AI-powered trip planning tools, including conversational assistants, will increasingly guide travelers from inspiration to booking. Instead of the dreaded 20+ browser tab airline fare booking experience to compare all possible options, passengers will increasingly trust and rely on AI queries to surface the most relevant offers based on shopping intent and context. For airlines, that means ensuring their offers are surfaced and taking more control of their marketing and distribution channels.
High look-to-book ratios (LTB) lead to significant computing costs and other inefficiencies, and it’s clear that LTB will likely remain high as travelers search for the best deal. With AI-driven search accelerating in Q1, airlines need to have the right distribution partner in place to own their distribution strategy and deliver relevant, accurate offers quickly across all channels to improve conversion rates. To help control offers and costs, technologies such as real-time price delivery and intelligent caching are key.
The Runway Ahead
The old models of static tickets and reward miles are giving way to a more dynamic, customer-focused approach. Airlines must transform into digital retailers that offer more customizable deals while providing clear pricing information to establish trust with flyers through transparent operations.
The shift from flight sales to journey development is already underway in 2026. Carriers that fail to adapt risk falling behind before peak summer travel. Airlines that use the right data, technology, and strategy set themselves apart in a market where travelers have many choices and no pre-conceived loyalty.
Frequently Asked Questions
By treating offers as the primary economic unit, airlines can immediately unlock new revenue streams. It allows them to use AI and optimization to move beyond the traditional seat-centric model and create context-aware travel experiences that capture more value.
Ancillary revenue is the income airlines generate from additional products and services beyond the basic flight ticket. This includes things like checked bags, meals, seat selection, and early boarding. It’s a significant part of their business, accounting for nearly 15% of global airline revenue in 2024.
Airlines are moving from a standardized ticket model to a more dynamic approach. This means shifting focus from selling a simple ticket (the order) to creating tailored experiences and optimized offers for each traveler.
Powered by modern technology and sophisticated AI, airlines can now craft more relevant offers—including dynamic fares and ancillary bundles—at every stage of the customer journey, making the offer itself the primary driver of revenue and brand loyalty.
This “dual shift” means airlines are simultaneously getting better at creating tailored packages (smarter bundling) while also offering more individual components of the travel experience for purchase à la carte (deeper unbundling). For example, they might offer a “comfort bundle” that includes extra legroom and a meal, while also allowing other passengers to purchase just a meal upgrade or fast-track security separately.
Travelers will have more control and flexibility to customize their journey by purchasing only the options they value. However, this also means that comparing the final price and value of flights across different airlines will become more complex, as each will have different offerings and fee structures.
