It is the only way they can advertise €19.99 fares to London or €39.99 to Paris!
Sometimes to get a good fare you have to suffer! Out on a day you don't want at a time you don't want just so they can advertise a €19.99 fare. Their sophisticated revenue management system sees to it that only very few get the €19.99 fare and even fewer will actually spend €19.99. And if they don't get you on the way out they'll get you on the way back.
You buy extra leg room by the inch. You pay to get up to the front so you can grab limited space in the overhead compartment for your bag. You pay, pay, pay depending on the level of comfort you want.
You see if you get a €19.99 fare and only spend that much then you're really not worth much to the company so you have to be enticed to buy extras. Some have us even paying to print our own boarding passes and for some we have to 'opt out' of purchasing their baggage. During the purchasing process, every click we make we are keeping our eye on the total price on the little box on the right hand side of the screen for fear of adding something we didn't want and unintentionally upping the fare we pay.
Keeping the €19.99 fare but increasing what they charge for baggage etc is maximising revenue. Charge €20 for 20kg then up the price to €20 for 15kg.
How much does it cost an airline to fly a bag from Ireland to Portugal and back? Well they have to pay for fuel. They have to pay for labour of loading and unloading the bag but even so hauling bags is hugely profitable for the airline and that is before you take into account the extra money they can get in penalties because your bag is oversize or overweight.
All these fees are understandable. Fees like these are insulated from competition whereas the basic fare isn't.