{"id":346,"date":"2026-05-30T14:11:43","date_gmt":"2026-05-30T14:11:43","guid":{"rendered":"https:\/\/crosscountrymovingteams.com\/?p=346"},"modified":"2026-05-30T14:11:43","modified_gmt":"2026-05-30T14:11:43","slug":"delta-has-trained-its-passengers-to-pay-premium-prices-heres-how-it-plans-to-get-even-more-from-them","status":"publish","type":"post","link":"https:\/\/crosscountrymovingteams.com\/?p=346","title":{"rendered":"Delta has trained its passengers to pay premium prices. Here\u2019s how it plans to get even more from them"},"content":{"rendered":"
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But other airlines, notably United Airlines and American Airlines, are using a similar playbook, to similar effect. So Delta\u2019s recently minted Chief Commercial Officer Joe Esposito, a 30-year company veteran, has been looking for new ways to push the airline\u2019s yearslong strategy to diversify its revenue away from main cabin ticket sales.\u00a0<\/p>\n

Read more The AI economy could crash on mounting chip costs \u2014 and those token costs won\u2019t help<\/a><\/p>\n

His initiatives include everything from testing out a plane with 44 first class seats on domestic flights, almost double the average, to landing more partnerships with other consumer brands. He is also looking to beef up Delta\u2019s travel services business, making the meals it offers in-flight more gourmet and even servicing engines for rival airlines.<\/p>\n

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Esposito was instrumental in developing and implementing Delta\u2019s \u201cpremium\u201d strategy before becoming chief commercial officer. And the success of that approach has been undeniable: in Delta\u2019s most recent quarter, premium revenue grew 14% year-over-year, coming within a hair of matching main cabin revenue, which only grew only 1%.<\/p>\n

His boss, CEO Ed Bastian, in a recent interview with Fortune<\/em>, called that strategy \u201cde-commodization\u201d of the air travel experience. Esposito, who became commercial chief in January, sees a parallel between running an airline well and premium retail\u2014 where success comes from offering a suite of options and complementary products.<\/p>\n

\u201cThe next innovation for us is how we pull all of our products together as a best-in-class retailer,\u201d Esposito told Fortune in an interview in his office at Delta headquarters in Atlanta. \u201cBecause we want more money from our customers, we have to put great products out there.\u201d<\/p>\n

Delta Air Lines\u2019 SkyMiles loyalty program, which now boasts 120 million members, has been highly effective in locking travelers into its eco-system and getting them to pay up. It has also stoked nearly obsessive devotion among customers. As New York Magazine<\/em> noted recently, Delta\u2019s SkyMiles members \u201caren\u2019t just loyal. They post their boarding passes as status symbols on TikTok.\u201d<\/p>\n

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But the flip side of love for a brand is hate and woe when customers feel betrayed\u2014when the service falls short or a beloved perk is retracted. (Remember all the anger at Delta when its lounges became chronically overcrowded?)<\/p>\n

More recently, Delta again won some brickbats when it announced it would stop food and beverage service on flights less than 350 miles, roughly 9% of its flights, for all but first-class passengers. Esposito defended the move, saying that it was not about saving money but rather about the short time flight attendants had. \u201cWe can\u2019t get the service done,\u201d he said. Delta has pumped the money saved into upgrading its beverage service for flights between 350 and 500 miles.<\/p>\n

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Delta is working on building or renovating lounges at Delta hubs such as Atlanta, Boston\u2019s Logan Airport, Seattle, and Salt Lake City, (Further out, Delta wants to open its first lounge in Las Vegas, a rare major airport without one. \u201cIt\u2019s our top priority,\u201d says Esposito.) The airline is also opening more of its Delta One ne plus ultra premium lounges, which offer amenities such as fine dining, spa-like wellness treatments, and valet services for its highest paying passengers.<\/p>\n

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The strategy is clear: focus on the most loyal devotees, even at the risk of disappointing more casual customers.<\/p>\n

Read more I worked with Steve Jobs at Apple, where every OS update killed startups. AI founders are about to face the same thing<\/a><\/p>\n

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\u201cUltimately you have to reward people who give you the most money,\u201d says Esposito.<\/p>\n

In all this successful pursuit of better-heeled customers, there is the risk of Delta going too far, and failing to cater sufficiently to a broader clientele that still makes up half of revenue\u2014and should work as a funnel to draw in future loyalists.<\/p>\n

Esposito says he\u2019s well aware of this imperative, pointing out that \u201cevery one of our million-milers started with a zero balance.\u201d \u201cWe\u2019ve got to bring people into the ecosystem,\u201d he adds. He bristles at any suggestion that Delta is too narrowly focused on its premium customers, pointing out that its main cabin service offers free Wi-Fi, video screens, and other perks, and that Delta offers many low-cost fares.<\/p>\n

Still, further elevating the premium air travel experience remains a priority. While remaining mum on the details, Esposito says Delta is testing out more elevated meal offerings on its flights. It is also pressuring its airport operator partners to improve the food options in terminals so there is more to choose from than fast food for passengers who can\u2019t get into a lounge.<\/p>\n

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Outside of flying, Delta is also working to further broaden its revenue sources: in 2024, diversified revenue streams made up 57% of the total at Delta; by March 2026 that had risen to 62%<\/p>\n

Delta wants to build its growing Delta Vacations reservation services, insurance, partnerships with brands such as Uber, Starbucks, Paramount, and others. Those kinds of partnerships, where Delta steers customers to a brand and gets a cut of the business, explain why the airline chose Amazon over Starlink as the provider for its in-flight services, to Elon Musk\u2019s highly vocal irritation.\u00a0<\/p>\n

\u201cStarlinks is not retailing, but Amazon is,\u201d says Esposito. \u201cYou can think about a partnership where you use those screens in the future for true retailing.\u201d<\/p>\n

One non-consumer-facing service Delta is betting on is providing engine maintenance services to other airlines. On a guided visit for Fortune at Delta\u2019s mammoth \u201cTechOps Center\u201d at Atlanta\u2019s airport, an executive said that business was very high-margin and is set to reach $1 billion this year, with plans for it to grow to a multi-billion dollar business.<\/p>\n

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For now, though, Delta\u2019s strategy will remain focused on pushing premium services and pleasing those finicky affluent customers who have made Delta the most profitable airline in the U.S.<\/p>\n

Read more I helped design the system that brought down ISIS financing. I\u2019ve got an AI governance idea the Pope and Anthropic would both like<\/a><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Delta is doubling down on luxury offerings, loyalty, and new revenue streams beyond ticket sales.<\/p>\n","protected":false},"author":1,"featured_media":345,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[100],"tags":[],"class_list":["post-346","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-air-travel"],"yoast_head":"\nDelta has trained its passengers to pay premium prices. Here\u2019s how it plans to get even more from them - Cross Country Moving Team<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/crosscountrymovingteams.com\/?p=346\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Delta has trained its passengers to pay premium prices. 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