Bottoms up? Airports and airlines don’t want you sober

by Tom Johansmeyer on

If you want to grab a beer at 5 AM, go to your nearest airport or board a flight. More airports are letting vendors sell liquor at dawn, or in some cases 24 hours a day. The move isn’t intended to keep you happy, of course, that’s really irrelevant to the aviation industry. Rather, the goal is to pump up revenues by getting you to dig a little deeper into your wallet while you’re traveling. Further, it reflects a bit of “marketing savvy,” USA Today reports, as airports and airlines are figuring out that they can sell just about everything, “from meals to day passes to their premium lounges.”

USA Today continues:

“What’s happening is airlines are becoming better retailers of products,” says Jay Sorensen, a consultant, who says the cocktail push by U.S. airlines began during the last year. “They’re doing things to highlight the fact that, ‘Yes, indeed, we do sell alcohol on the airplane.’ They’re trying to mimic what occurs on the ground in terms of consumer promotions.”

Of course, some corners of the airline industry aren’t happy about the prospect of bringing new revenue into businesses that often struggle to perform well. The concerns are legitimate, with “some union leaders, local officials and frequent fliers fear[ing] that the increased access to alcohol raises the risk of more drunken travelers, particularly at a time when many passengers find a travel experience that involves enhanced screening and crowded planes more stressful than ever,” USA Today reports.The decision to serve liquor around the clock is expected to have tangible results, however, with an extra $500,000 to $1 million in revenues for O’Hare alone, up from the current level of approximately $20 million a year.

There’s good money in liquor, and if you drink enough, maybe the airlines and airports will be able to invest in a little customer service training …

Zagat survey: five ways customers say they hate airlines … in their own words

by Tom Johansmeyer on

It’s almost sport for customers to describe how much they hate airlines. Sure, there are a few that do well from time to time, occasionally delivering high levels of service or eschewing ancillary fees. But, the overwhelming trend tends to be one of customer dissatisfaction.

Zagat, which is in the business of measuring and publishing value and taste, has taken a shot defining the highs and lows of the airline business, and the results aren’t all that positive. Well, let’s be frank: there’s nothing pleasant about flying.

The survey results aren’t all that shocking, and you can get them here from Zagat. What’s more fun is the stuff Zagat wouldn’t print … on the advice of its lawyers, the company announcement claims with an implied smirk.

How bad can it be? Let’s look at five insights from the Zagat airline survey … with customer claws bared in all their gory glory:1. Akin to an execution: Zagat’s surveyors seemed to spend a lot of time talking about death. One noted, “The only thing missing is a blindfold and a cigarette.” Another said, “At least they haven’t killed me yet.” Get the message? In case you don’t, one called air travel, “A violation of the Geneva Convention.”

2. Service with a scowl: again, it’s not much of a shock that customer service didn’t score all that high. One surveyor summed it up: “Unwelcome aboard!” But, if you think that’s the most creative, you’re out of your mind. I did enjoy the comment, “My bags get better service, but they pay extra.” Nothing, however, beats one disgruntled contributor who asked, “Who made them mad at their customers?”

3. Not even money can buy you happiness: do you think the rich have it better? Well, not in the skies they don’t! According to one Zagat surveyor, “The only difference between economy and business classes is a shrimp on your salad.”

4. Training is key: and this is what led one to muse, “Flight attendants seem to have trained with Frau Blucher.” Yes, but what instruction guide was used? That’s where another chimed in: “Staff must use Orwell’s 1984 as a training manual.” Ouch.

5. Get comfortable? Get real: the fact that passengers don’t get a lot of space didn’t escape notice. One surveyor says, “I don’t love getting up-close-and-personal with the head of the person in front of me.” Notes another, “Seats make an iron maiden seem comfortable.” It gets worse: “Like a cattle car, except the cows are mercifully slaughtered at trip’s end.”

[photo by joiseyshowaa via Flickr]

Airlines add seats on optimism for 2011

by Tom Johansmeyer on

Do you think body scanners and TSA groping will keep people off planes next year? Well, the airlines don’t think so! Carriers are adding seats and flights, according to USA Today, in the hopes that the travel industry will continue to improve in 2011 as it has in 2010.

Through November this year, the top 10 airlines in the United States added 2.7 percent more seats for passengers than they had a year earlier, USA Today reports, with 90 percent of the airlines adding seats “by increasing the number of flights or moving to bigger planes.” JetBlue added the most with an up-tick of 7.6 percent, followed by Delta, which added 5 percent more seats year over year.

Business travelers are leading the charge, it seems, with airline readiness bolstered by a few years of tough times:

With signs of improvement in the economy, travel demand, particularly from the corporate sector, is on the rise. After three years of retrenching in the face of higher fuel costs and fewer travelers, airlines are beefing up capacity incrementally on profitable routes. They’re adding slowly so as not to have to lower fares. They’re adding seats on international routes more quickly than on domestic routes.

And the good news for the airlines is that these aren’t loss-leader additions. USA Today continues:

“We’re growing in profitable markets. We’re not flooding the seats with low (fares) to manufacture a competitive situation,” JetBlue spokeswoman Jenny Dervin says. “The overall supply and demand is in good ratio.” Much of JetBlue’s added capacity comes from additional flights to the Caribbean and in the Boston market, Dervin says. Other carriers are also sharply increasing international flights.

International fares are up 30 percent to 50 percent, with domestic fares up around 15 percent year over year.

[photo by mrkathika via Flickr]

TSA to impede travel market recovery? Not buyin’ it

by Tom Johansmeyer on

When I finally crawled out of bed and caffeinated Saturday morning, I made the rounds on Twitter and found a bold statement by travel journalist Christopher Elliott: “Thanks to TSA, 2011 could be a flat year for travel”. Despite the digging he did, I’m just not buying it. Passenger inconvenience, especially when it comes to leisure trips, isn’t likely to have a major effect on the travel industry in 2011.

You’ve read it from me on Gadling before: it isn’t the leisure traveler that defines the travel market; it’s the business traveler. These are people who have no choice but to hit the road, whether because they are instructed by their bosses or because they recognize business opportunities that they need for growth or simply to keep their companies alive. As business conditions continue to improve in the broader economy, demand for flights is likely to increase, and those buying tickets will have relatively little choice in the matter.

We’re looking back on what’s shaping up to be a positive year for the travel industry, particularly the airlines. And, according to Elliott, on his blog, “2011 was shaping up to be the best year for travel since the recession began.” He cites expectations of higher prices, even if only slightly, but pent up demand by travelers for “long-postponed vacation[s].”

Thanks to TSA, 2011 could be a flat year for travel http://bit.ly/gsbOfTless than a minute ago via webChristopher Elliott
elliottdotorg

The next year of the recovery could be imperiled, however, by new measures implemented by the Transportation Security Administration, specifically body scanners. In fact, Elliott writes:

But now that the Transportation Security Administration has introduced full-body scanners at many American airports, and subjected those who opt out of the machines to an “enhanced” pat-down, the 2011 outlook has changed, say travelers.

To support this claim, he talks to Jeff Cohen, an Austin, Texas-based securities trader, who claims to be “torn about whether I’ll travel more next year or not.” Cohen tells Elliott he goes on “a couple of large trips a year” and had a big one in mind for the first half of next year, “to somewhere exotic.” Now, Cohen tells Elliott, “[T] he recent TSA crackdown has me rethinking that.”

Further, the Consumer Travel Alliance sees the traveling public as generally unlikely to increase its travel activity. Elliott continues:

A majority (46 percent) say they will travel “about the same” as they did this year. Slightly less than a third (30 percent) will travel more, while just less than a quarter (23 percent) will travel less. This contradicts several earlier surveys, which had predicted a significant upswing in travel next year.

The key word here is consumer. The focus, here, is on leisure travel. The needs of business travelers are again overlooked.

Let’s consider Cohen’s case for example. So, he’s rethinking his leisure travel plans for next year. If he has to hop on a plane to close a deal or bring in a new client, is he going to do that? Would he sacrifice a two-hour flight for a 10-hour drive do so? I don’t know the guy, but drawing on my white-collar experiences, I think I know how he’d react to a major business opportunity a few states away … and it wouldn’t involve turning the key to the ignition.

The business traveler really has little choice in whether to hit the road. Could he skip a business opportunity or pass on a project in favor of something local – or to wait for a gig nearby to arise? Of course. But, that would mean turning down the very fees that put food on the table. Sales professionals need to travel to bring in business, fulfillment teams (e.g., the folks who provide the good or service sold) may have to take to the friendly skies and support sometimes needs to be provided on site. This is just how the nature of commerce has evolved. If conditions continue to improve, more of these people will be buying plane tickets.

And, they’ll pay more for them.

The nature of business travel, given that it occurs in order to support subsistence or the accumulation of wealth (both important), is that it is inelastic, at least relative to leisure travel. There is effectively no choice but to get on a plane, unless extreme measures are brought into the equation. Since business travel relatively inelastic, these travelers will pay more, which supports a continued travel industry recovery.

The fact that business travelers tend to be willing to pay more for their tickets also means that they have less choice in whether to fly. Sure, there are tools out there such as videoconferencing and online collaboration software that can provide a substitute, but a recovering market means that there’s more capital available, which facilitates investment in face-to-face meetings. When your boss tells you to travel, you travel.

As a result, the decision to travel is itself relatively inelastic for the business traveler.

So, if the business traveler is the backbone of the travel industry recovery, the TSA is unlikely to get in the way in 2011, even if every passenger listens to the snap of a rubber glove before an invasive pat-down begins.

Now, let’s take a closer look at the leisure traveler. The impact of the TSA security measures may involve a bit of hype there, too.

Even before Thanksgiving, the close to two thirds of consumers thought the body scans weren’t a big deal, with 70 percent stating they didn’t expect the enhanced security measures to slow travel down during the busiest travel season of the year.

Further, economic growth, if it occurs, will provide consumers with more disposable income. Those who have an interest in travel are likely to become more ambitious, taking the trips they’ve always wanted to. Elliott finds many who disagree with this assessment, but there’s nothing like having a freshly filled checking account to alter your perspective.

We all love to hate the TSA, and I’ll admit that I’m among the many in that camp. There’s nothing worse than waiting in a long security line at a crowded airport. The notion of having to devise and carry out strategies for getting through the checkpoints faster indicates the absurdity of what goes on in airports today. Efficiency is as low as customer service, and there’s little we can do about it.

That said, will body scans and pat-downs impede a travel market recovery next year? It doesn’t seem likely. General global economic trends will determine how many people get on planes next year, not the policies crafted and implemented by government employees.

[photo by oddharmonic via Flickr]

Delta says customer service isn’t dependent upon costs

by Tom Johansmeyer on

It looks like Delta has some strong thoughts on airfare and customer service. The airline identified as the worst in the United States is now saying that customer service shouldn’t be related to operating expenses – well, at least that’s the implication of the new ad the airline is running on New York City subways: “Customer service shouldn’t fluctuate with the price of oil.”

The fact that airlines generally aren’t famous for customer service is well-established, and many excuses reasons are given, ranging from regulatory constraints to a lack of cooperation from passengers. Of course, cost always comes into the equation, too. Despite a strong year for air carriers in 2010, history shows that this is a volatile industry, and it’s always necessary to keep an eye on expenses.

It isn’t unusual to see airline industry employees cite cheap flights as a reason for the decline in customer service: what else do passengers expect, right?
This is what makes Delta’s move so interesting. A direct statement that service shouldn’t be constrained by underlying expenses (and thus profit margins), the ad I saw on the 3 train yesterday morning takes a bold stand. Delta is taking conventional wisdom head-on (well, airline industry conventional wisdom) in a very public way.

It should be interesting to see if this leads to a change in the airline industry employee population’s position on the relationship between cheap tickets and passenger expectations. For Delta employees, leaning on the traditional rationale results in a direct contradiction with the company’s stated message. Though the sentiment may not trickle down to employees of other carriers, their being vocal about the informal “expense-to-service” ratio inherently puts them at a disadvantage relative to Delta’s claim. The subtlety may not reach the average consumer (especially those who don’t come into contact with Delta’s ads), but the implication is clear.

Doubtless, it makes sense to draw distinctions between advertisements and expectations, and any change at Delta based on this messaging will take time to implement (let’s be realistic – big companies do tend to move slowly). Nonetheless, it will be interesting to see how this situation unfolds.

So, tell us what you think: do you think customer service expectations in the airline business should be linked to the price you pay for a seat? Leave a comment below!