Unlocking Hidden Revenue: How Ancillary Products Can Transform Your Travel Agency's Bottom Line
The travel industry is in the midst of a profound transformation. While airline consolidation has slashed traditional ticket commissions to under 3% of total volume for most agents, a massive $148 billion opportunity is waiting to be captured. The secret? Ancillary products—those essential travel add-ons that can turn a modest booking into a highly profitable transaction.
For small and independent travel agents, this shift represents both a challenge and an opportunity. Platforms like Flyo are specifically designed to help small travel agencies tap into these lucrative ancillary revenue streams without the complexity of managing multiple supplier relationships.
The Ancillary Revolution: Numbers That Demand Attention
The growth in ancillary revenue isn't just notable—it's staggering. According to IdeaWorksCompany's 2025 Yearbook of Ancillary Revenue, global airline ancillary revenue surpassed $148 billion in 2024, representing a 26% leap over 2023 and nearly $39 billion above pre-pandemic levels. This isn't a temporary spike; it's a structural shift in how travel is monetized.
What makes this particularly relevant for travel agents is the composition of this revenue. While airlines focus heavily on baggage fees and seat selection—which account for over one-third of their ancillary earnings—the real opportunity for agents lies in commission-based products: hotels, car rentals, travel insurance, tours, and experiences.
OAG's analysis of the airline industry reveals that ancillary services now account for over 15% of total airline revenues, with the most aggressive carriers generating more from extras than from base ticket sales. Five airlines crossed the 50% ancillary threshold in 2024, led by Frontier at 62%, followed by Spirit, Volaris, Breeze, and Allegiant.
The message is clear: if airlines are building their business models around ancillaries, travel agents who ignore this revenue stream do so at their peril.
How Flyo Empowers Small Travel Agents
Small travel agencies often struggle to access the same ancillary product inventory and commission rates that large agencies enjoy. This is where Flyo makes a difference.
Flyo's platform provides small and independent travel agents with:
- Unified Access to Premium Ancillaries: One dashboard to sell eSIM, travel insurance, airport lounge access, meet-and-greet services, and more
- Competitive Commission Rates: Negotiated bulk rates that level the playing field with larger agencies
- Zero Integration Hassle: No need to manage multiple supplier relationships or contracts
- Real-Time Inventory: Instant access to global travel services across 195+ countries
- Automated Fulfillment: Digital delivery of vouchers and confirmations directly to customers
Small agencies using Flyo have reported 30-40% increases in per-booking revenue by systematically offering ancillary products to every customer. The platform makes it simple to bundle services that travelers actually want—connectivity, comfort, convenience, and protection.
The Commission Opportunity: What Ancillaries Actually Pay
Understanding the commission structure across different ancillary categories is essential for strategic selling. Here's what the data shows:
Travel Insurance: The Hidden Goldmine
Travel insurance consistently offers the highest commission rates in the industry, ranging from 20% to 40% of the premium cost. Some agencies report minimum commissions of 60% of the supplier commission for travel insurance sales. On a $1,000 policy for a $10,000 trip, an agent could earn $200-$400—often more than the commission on the flights themselves.
Through Flyo's insurance marketplace, travel agents get instant access to multiple insurance providers with transparent commission structures, allowing you to compare options and select the best coverage for your clients while maximizing your earnings.
Hotels and Accommodations
Hotel commissions typically range between 8% and 15% of the room rate. Luxury properties and all-inclusive resorts often pay at the higher end of this spectrum, with some preferred partnerships pushing toward 20%. The key insight: independent and boutique hotels are frequently more generous than large chains, though chains offer the advantage of consistent commission structures and worldwide inventory.
Cruises
Cruise bookings remain one of the most lucrative products for travel agents, with commissions generally ranging from 10% to 20% of the total cruise fare. The average sits around 16% for ocean cruises. Group cruise bookings, in particular, yield approximately 30% higher margins than individual traveler bookings.
Tour Operators and Vacation Packages
Tour operator commissions range widely from 10% to 20%, with custom tour operators and luxury travel companies sitting at the higher end. Some tour operators pay as much as 25% commission on certain products, particularly for advance bookings or during promotional periods.
Car Rentals
While car rentals typically pay the lowest commissions (5-10%), they require minimal time investment and can be easily added to existing bookings. Budget and National, for example, pay 5% commission on base rates for leisure rentals.
Activities and Excursions
A growing revenue source with commissions typically ranging from 10% to 25%. Online platforms connecting agents with activity providers have made this easier than ever to include in itineraries.
The Fastest-Growing Ancillary Categories: Where the Smart Money Is Going
Beyond the traditional commission categories, several high-growth ancillary products are emerging as essential offerings for forward-thinking travel agents.
eSIM: The Connectivity Revolution
Perhaps no travel service is growing faster than eSIM. According to latest industry analysis, the market has reached an inflection point and is entering a period of hyper-growth. Travel eSIM users are expected to grow from 40 million in 2024 to over 215 million by 2028—a staggering 440% increase.
The numbers tell a compelling story: 65% of travelers already prefer eSIM over physical SIM cards. This shift is driven by a massive increase in smartphone support. Nearly all premium smartphones from Apple, Samsung, and Google since 2023 are eSIM-ready, with many flagship models now dropping physical SIM slots entirely.
For travelers, the demand is simple: never going out of network. Being connected from the moment they land is no longer a luxury—it's an essential part of the modern travel experience.
How Flyo Powers the "Always On" Experience:
Flyo's eSIM marketplace provides the infrastructure to keep your travelers connected in 195+ countries:
- Instant Activation: QR codes delivered via email or WhatsApp in seconds.
- Global Network: Coverage across 195+ countries with high-speed data.
- Reliable Connectivity: Automatically tapping into the best local carriers so travelers never go out of network.
- 24/7 Digital Support: Ensuring a smooth terminal-to-destination experience.
The era of searching for airport Wi-Fi or hunting for local SIM kiosks is over. Travelers now expect seamless, instant connectivity, and eSIM is the technology making it possible. Small agencies using Flyo report that eSIM adoption rates now exceed 60% for international bookings, reflecting the massive consumer demand for "always-on" data.
Airport Meet and Greet Services
VIP airport assistance has evolved from an ultra-luxury niche into a mainstream ancillary with broad appeal. Services now operate at over 1,150 airports across 195 countries, offering everything from fast-track security and customs assistance to porter services and lounge access.
Pricing typically ranges from $75-150 for basic meet-and-greet services up to several thousand dollars for private terminal experiences. Travel agents can access these services through platforms like Flyo and typically earn 15-20% commission on airport transfers and ground services.
The target market extends well beyond VIPs: families traveling with young children, elderly passengers, first-time international travelers, business executives with tight connections, and anyone navigating unfamiliar airports all represent potential buyers.
Airport Lounge Access
Pre-bookable lounge passes represent a growing ancillary category with proven demand. Services allow travelers to access airport lounges regardless of ticket class, with single-visit passes typically priced between $30-50.
For travel agents using Flyo, lounge access earns commission on every sale while boosting customer satisfaction. The perceived value is high—travelers save $20-40 per visit on food, drinks, and Wi-Fi they would otherwise purchase—while the actual cost to deliver is minimal.
Networks operate over 600 lounges at 350 airports, providing comprehensive inventory for agents to sell against. The key to success is proactive positioning: suggest lounge access during the booking process, particularly for long-haul flights, early morning departures, or trips with extended layovers.
Seat Selection and Premium Seating
Seat selection fees have become one of the highest-margin ancillary categories in aviation. United Airlines collected $1.3 billion from seat selection fees in 2023, exceeding its baggage fee revenue for the first time. This represents a fundamental shift: unlike baggage handling, which carries operational costs, seat selection revenue flows almost entirely to the bottom line.
For travel agents, the opportunity lies in understanding and communicating the value of seat selection to clients. Families traveling together, business travelers requiring aisle or front-row seats, and anyone on long-haul flights represent prime targets for seat upgrade sales.
Pre-Ordered Meals and Premium Dining
The retail-on-board segment is experiencing robust growth, projected to expand at approximately 13% annually through 2029. Airlines are increasingly offering meal pre-ordering systems that allow passengers to select and pay for enhanced meal options in advance.
This represents a classic bundling opportunity for agents. EasyJet reported that nearly 50% of its ancillary revenue comes from bundled baggage and seat packages—adding meals to these bundles creates additional margin while improving the perceived value proposition.
The Package Power: Lessons from EasyJet's Success
Perhaps no case study better illustrates the profit potential of bundling than EasyJet Holidays. The budget airline's package holiday division saw earnings soar by 56% in 2024, now representing nearly one-third of company-wide profits. The airline reported that while a return flight generated roughly $23 in profit, a customer booking a full holiday package brought in approximately $125—more than 5 times the profit per customer.
This dramatic difference stems from the compounding effect of ancillaries. When customers book a package, they typically add transfers, tours, activities, insurance, and other services. Each component contributes additional margin, transforming a commodity transaction into a high-value relationship.
For travel agents using platforms like Flyo, creating these bundled packages is straightforward. The platform's unified dashboard allows you to combine flights, hotels, insurance, eSIM, airport services, and activities into a single quote—dramatically increasing your revenue per booking while delivering exceptional value to your customers.
The data shows that bundled bookings generate 3-5 times more revenue than flight-only transactions. The data also shows that offering dynamic packaging leads to a 37% increase in redemption activity and a 42% customer return rate.
Practical Strategies for Maximizing Ancillary Revenue
1. Build Comprehensive Packages
Instead of booking just a hotel, create packages that include accommodations, tours, transfers, travel insurance, eSIM connectivity, and airport services. Each component adds to total commission earnings while providing clients with a more convenient booking experience.
Flyo Pro Tip: Use Flyo's package builder to create templated offerings for popular destinations. Pre-built packages convert at 2x the rate of à la carte bookings because they reduce decision fatigue for customers.
2. Lead with Insurance—But Don't Stop There
Given the high commission rates and genuine value proposition—especially post-pandemic, when 76% of travelers say they would use a travel advisor to navigate complex travel rules—insurance should be part of every client conversation. But extend the conversation to connectivity (eSIM), comfort (lounge access), and convenience (meet-and-greet services).
Frame these around protection and peace of mind, not as add-ons. Flyo's platform allows you to present these as a cohesive "worry-free travel bundle" rather than separate upsells.
3. Position eSIM as Essential, Not Optional
With 65% of travelers now preferring eSIM over physical SIM cards and the market growing at 85% year-over-year, connectivity has become a baseline expectation. Present eSIM packages proactively for every international booking—the 35% savings versus roaming charges makes this an easy sell that delivers genuine value while earning commission.
4. Target High-Touch Travelers for Premium Services
Meet-and-greet services, lounge access, and premium seating aren't just for the ultra-wealthy. Identify clients who would benefit most:
- Families with young children navigating large airports
- Elderly travelers needing assistance
- Business executives with tight connections
- First-time international travelers
- Anyone with mobility concerns
These services command premium prices and strong commissions. Flyo makes it easy to identify and suggest the right services based on passenger profiles and itinerary details.
5. Bundle Seats, Meals, and Connectivity
Take inspiration from airlines like Finnair, which bundle seat selection with WiFi at discounted prices. Create your own bundled offerings that combine seat upgrades, pre-ordered meals, and eSIM packages.
6. Focus on High-Margin Segments
The MICE (Meetings, Incentives, Conferences, and Exhibitions) sector is valued at $805 billion and relies heavily on specialized agents. Group travel bookings yield 30% higher margins than individual traveler bookings. Medical tourism, valued at $115 billion globally, represents another high-margin niche.
The Bottom Line
The travel industry's economic structure has fundamentally changed. The era of building an agency business primarily on ticket commissions has passed. But in its place, a more diverse and potentially more lucrative opportunity has emerged.
The data tells a compelling story: global ancillary revenue exceeds $148 billion, package bookings generate 3-5 times more revenue than flights alone, insurance commissions can reach 40% of premium costs, and emerging categories like eSIM are growing at 85% annually. Travel agents who embrace ancillary products as a core strategy—not an afterthought—are positioning themselves for sustainable profitability.
For small and independent travel agencies, the challenge has historically been access. Large agencies with dozens of employees and established supplier relationships could offer comprehensive ancillary products. Small agencies were left behind.
That's exactly why Flyo was built.
Flyo levels the playing field by giving every agency—regardless of size—access to the same premium ancillary products, competitive commission rates, and streamlined fulfillment that previously required massive scale to achieve.
The most successful agents in 2025 and beyond will be those who think holistically about the traveler journey. Every international trip is an opportunity to sell connectivity (eSIM), comfort (lounge access, premium seating), convenience (meet-and-greet services, pre-ordered meals), and protection (insurance). Every family vacation is an opportunity to bundle services that make travel easier while building loyalty and earning commissions on multiple product categories.
Ready to unlock ancillary revenue for your agency?
Explore Flyo's platform and discover how small travel agencies are transforming their businesses with access to premium ancillary products, competitive commissions, and automated fulfillment—all in one unified dashboard.
Frequently Asked Questions
Q: How much commission can travel agents make on ancillary products?
A: Commission rates vary by product category. Travel insurance offers the highest rates at 20-40%, followed by tours and activities (10-25%), hotels (8-15%), and cruises (10-20%). Even lower-commission products like car rentals (5-10%) add up when bundled together.
Q: What is the best ancillary product for small travel agencies to start with?
A: Travel insurance and eSIM connectivity are ideal starting points. Both offer high commission rates, strong customer value propositions, and digital fulfillment. Platforms like Flyo make it easy to add these products to any booking with minimal training required.
Q: How do I convince clients to buy ancillary products?
A: Focus on value and peace of mind rather than features. Frame ancillaries as solutions to real problems: insurance protects their investment, eSIM keeps them connected affordably, lounge access makes long layovers comfortable, and meet-and-greet services reduce stress in unfamiliar airports.
Q: Can small agencies really compete with large agencies on ancillary products?
A: Yes, especially with platforms like Flyo that provide small agencies with access to the same inventory and competitive commission rates as large agencies. Many small agencies actually outperform large ones on ancillary attachment rates because they provide more personalized service.
Q: What percentage of my bookings should include ancillary products?
A: Industry data shows 67% of travelers purchase at least one ancillary. Top-performing agencies using Flyo achieve ancillary attachment rates of 70-85% by systematically presenting relevant products during the initial booking conversation.
Sources: OAG Aviation Reports, IdeaWorksCompany 2025 Yearbook of Ancillary Revenue, Juniper Research Travel eSIM Market Reports, IATA NDC Documentation, CarTrawler Ancillary Revenue Studies, Industry Commission Rate Surveys, Collinson Group Lounge Access Data