When you buy a Big Mac, do they charge you for the lettuce and special sauce?
There has been a lot of press lately about the airlines continuing to add fees for everything they can think of.
I don’t know what these guys are thinking when they do this.
An article on CNN’s site quoting airline consultant Robert Mann, says the following about their thinking:
Airline consultant Robert Mann of R.W. Mann & Co. expects the carry-on and possible toilet fee to remain firmly in the realm of the aggressive discount carriers, who capitalize on “an infinite demand for very low fares.”
“A lot of people will put up with a lot of inconvenience and crazy fees in order to think they got a low fare,” Mann said.
Can they not just figure out how to charge a price and make money to cover it? Are they trying to modify our traveling behavior through a pricing scheme?
There is now proposed legislation requiring the airlines to disclose their add on fees to the customer in a way that you would really know what you are paying prior to travel.
So should we require McDonalds to tell you how much they are charging for the special sauce when you buy the Big Mac? Or can we be content that we either think the Big Mac is worth it at the price, or we don’t buy it.
Every time the airlines irritate the consumer with their pricing schemes or bad schedules or whatever the irritant of the day is, the government tries to legislate some way to make them behave.
Most of the airlines you fly on have their flight attendants thank you for choosing them. It goes something like this: “Thanks for flying with us today; we know you have a choice and we are glad you chose us”.
Our friend Dan Robles who posts frequently on Plane Conversations writes the following about the airlines pricing schemes in a recent post on his site:
Steven Frishling (www.flyingwithfish.com) predicts that there will be a schism in the industry, some airlines will take on the race to the bottom with ancillary fees and others will realize that every angry customer is an opportunity to migrate to a superior travel experience.
Charging is obnoxious – every hit hurts. In fact, Expedia makes the majority of their fees off everything except airlines, why can’t airlines?
Steven suggests that the opposite of bundling – integrating hotels, taxis, sponsors, etc even using frequent flyer miles – is a the best way to improve the experience of flying. Airlines should provide targeted portals, build sponsored content, attract sponsor revenue, supply hotlinks, etc. All of these are clever ways to derive revenue without alienating passengers.
All this “cost-saving” of ancillary pricing can quickly become a huge liability as competitors come along with comparable prices and superior service. Social media is proving to be an excellent tool for reaching out to passengers and understanding the needs. This allows them to package features smartly, unbundle fees in a way that adds value to the experience, not by squandering trust and respect at every opportunity.
Ultimately, the market will take care of this anti-social behavior of the airlines. Maybe some airlines will succeed by attracting that “infinite demand for very low fares,” but I have to believe that most of us do not want the confusion, inconvenience and trickery of it all.
We do have a choice as to who we fly with. We even have a choice to not fly at all. What about the choice to fly in a private aircraft? Can we offer these consumers a better choice at a price they can live with?
If the airlines aren’t going to do what Steve Frishling suggests, then why don’t we?
I believe that the whole “a la carte” airline pricing idea has not only been born out of the increasing need for new revenue streams but also a manipulation of basic human psychology. How? Well when one looks for an airfare, the natural human reaction is to look for the lowest prices. If one sees a 40 dollar fare for Spirit from NY to FL theres the “what a deal!” factor. Only later does the unwitting consumer find out what the flight really costs with all the other “fees”. It is NOT to the airlines advantage to have one fee out there since there is this tremendous mental need to “get the best deal”. This, unfortunately has contributed to the race to the bottom insted of competition based on service.
Private aviation (especially in charter) has many of the same issues. How many charter flights have been lost since another company has a lower quote (often at a loss). The client simply sees the “DEAL” and nothing else, and there is currently no established easy way for a client to get real time feedback about a certain charter organization other than perhaps general word of mouth.
Where social media has a tremendous advantage is in providing this real time feedback. Imagine if a client could pull up “XYZ Charter” and see current feedback from clients that have used there service both good and bad. This can go a LONG way for the client to chosing one operator over another and somewhat mitigates the cost factor since it is a proven psychological fact that people will ALWAYS pay more for quality.
After all, why do people pay more for a Lexus than Chrysler? Its all about quality and the perception of quality. That is what every charter operator can strive for in the social media world. To be the “Lexus” of aircraft charter and provide the very best in service at a fair price even if that price is higher than some its rivals.