Recently, the Centre for Asia-Pacific Aviation (CAPA) published a report which concluded that the “full-service airline model break down in the new-world order“.
“Worldwide, the number of passengers travelling on First or Business class tickets fell by 16.7% in Jan-2009, a further substantial fall from Dec-2008 levels, which were 13.3% down on the year.”
That means that legacy airlines, which made a majority of their money from premium passengers, are struggling, even as low-cost carriers see greater traffic from people downgrading and new people taking to the skies.
What does the future full service airline model look like?
Here’s my prediction.
It will consist of airlines charging for providing value added services
, rather than those un-bundling their products. Moreover, customer service will become a key brand distinction
for the full-service airline, as prices would generally be competitive and so would most of the in-flight products too. The savvy traveler of the future will not only hunt the lowest prices, but be loyal to the airline that treats him well. Lastly and most importantly, employees of the full service airline will be part of the family, and share the love with customers at every touch point too (up to 16 per customer!
Which airline is closest to the future? Southwest.
A lot of you might be wondering why I picked Southwest. Since that’s the airline that led the low-cost carrier (LCC) revolution. But I feel even among the LCCs, there is a a huge disparity. At one end, there’s RyanAir
, which might just charge for the loo and intends to remove all check-in counters very soon. And at the other end is Southwest, Virgin Blue and JetBlue, which offer a number of value added services, yet maintain a low price.
Here’s a comparison table I’ve drawn of Southwest Airlines and the full-service carrier of the future.
What do you think? What does the future of full-service airlines look like to you? Do you think Southwest is a good indication of the future or are there better examples too?