Additional fees in the airline industry : an examination of its effects on customers buyers behavior, customer satisfaction and perceived value

Abstract

In recent years the airline industry has increasingly shifted their revenue strategies towards additional fees and unbundle pricing strategies. While these fees generate substantial income for airlines, they also raise important questions about their impact on customer perceptions regarding price fairness and transparency. This thesis addresses the research problem of whether additional airline fees influence customer buying behavior, customer satisfaction and perceived value when purchasing airline tickets. A quantitative survey design was used to collect data from recent airline passengers (n = 139), with responses analyzed through descriptive statistics, correlations, ANOVA and multiple regression models. In order to test six hypothesis and nine exploratory research questions. The analysis incorporated both perceptual variables and segmentation variables in order to capture a comprehensive view of customer responses to additional fees. The findings provided evidence that additional fees do in fact influence customer evaluation across all three constructs. Buying behavior was strongly influenced by perceptions of baggage fees and comparative pricing disadvantages for low-cost carriers. Customer satisfaction was primarily determined by fairness perceptions and trust in price transparency, while demographic differences played only a minor role. Perceived value was shaped by fairness perceptions and customer travel frequency, with comparative pricing amplifying difference between low-cost and full-service carriers.Among the exploratory research questions analyses, demographic such as age and travel type showed limited influence, whereas situational and perceptual factors such as price fairness and transparency resulted as the strongest predictors for satisfaction and value. Baggage fees were found to have a direct effect on customer behavior regarding packing choices and booking decisions. The study concluded that additional fees are not purely used as a revenue tool but are central drivers of customer perceptions, with implications for both marketing strategy and long-term customer relationships in the airline industry.