SimpliFlying

Image by Richard H Martin via Flickr

Singapore Airlines has always been admired for its consistently high-quality products and innovation, especially in times of crises. From using the latest aircraft like the Airbus A380, to customer service that even other airlines talk about. Recently, Harvard Business School Professor Rohit Deshpande talked about Singapore Airlines’ strategy for success in an interview on the HBS Publishing website, conducted by Scott Berinato. His conclusion - competing on price alone never bears fruit.

Thinking beyond price competition

Professor Deshpande explains in the interview that too many airlines around the world, and especially in the US, compete on price alone and this forces them to commoditize their businesses. They remove any additional frills and the concept of in-flight service is diluted substantially. This is exactly what Singapore Airlines doesn’t do. It never compromises on the quality of service, and charges a premium for that. In a world many airlines are eliminating services on-board, Singapore Airlines pampers those who’d pay for it  - and there are plenty of disgruntled traveleres today who would!

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The JetBlue Airways in-air communications division, LiveTV, purchased the Airfone network from Verizon in early June 2008. The purchase includes 100 ground to air transmission stations as well as any remaining corporate and government customers. More importantly, LiveTV plans to use the network for voice, email and other online services on board planes, starting with their own aircraft. This has been an exciting journey, ever since JetBlue acquired LiveTV from Thales earlier in the decade.

The airplane is an island no more

With LiveTV in-seat video, every passenger on the aircraft gets a personal TV screen with up to 36 channels of live satellite programming, a GPS map channel and four additional channels of stored content. In addition to this, LiveTV allows people to listen to XM Satellite radio, and now with the acquisition of AirFone, connect with those on the ground using their communication devices too. Having built a strong and popular product, JetBlue has now started to encash on LiveTV.

Time to set the cash registers ringing

The LiveTV product provides authentic value-added services to JetBlue’s customers. The keyword here is authentic. Unlike a number of other airlines who seem to be charging for basics like a cup of water in order to make money, LiveTV actually charges for a real value added service. The best part is that many of the channels and services on LiveTV are free, and customers can pay more for what they really want - a very sound business model.

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Another ranking, another familiar (and not so familiar) story. This time, Travel+Leisure ranking of World’s Best international airlines ranks Singapore Airlines at the top, followed by Emirates - which climbed a notch, and Thai Airways as the third, which climbed two notches. The surprise entries in the top few airlines here are SilkAir - Singapore Airline’s regional wing - and Air Tahiti Nui. It’s surely a proud moment for those at Singapore Airlines and SilkAir to have both the airlines among the world’s best. Air Tahiti Nui is in the Top 10 for the first time, so quite an achievement for them as well.

All rankings like these tend to bring out certain unique nuances about the airline industry. Here are some interesting observations.

1. These rankings are attained by surveying readers of the Travel+Leisure magazine, who’re serious holiday-makers. Hence, the inclusion of “holiday-destination-heavy” airlines like SilkAir and Air Tahiti Nui should be taken with a pinch of salt. Moreover, the fact that other established holiday airlines like Thomas Cook and Condor are not included in this ranking should send some signals back to their headquarters.
   
2. The fact that there is hardly any overlap between these rankings and airlines that won the Freddies - ranking of the best frequent flier programs - reflects that most of the fliers who’ve participated in this survey are not frequent fliers. So does that mean that this ranking should carry less importance than others? Probably not. It just reflects the preferences of a different segment of travelers. Read the rest of this entry »

   

   Tags: Air Tahiti Nui, Emirates, Rankings, SilkAir, Singapore Airlines, Thai Airways, Thomas Cook
   

US based Southwest Airlines and Canada’s WestJet Airlines paved the way for a strong relationship by announcing codeshares starting 2009. Not only will the relationship give customers access to a much larger number of destinations across North America and the Carribean, but the customers of both the airlines would appreciate the seamless brand experience across borders.

Image Credit: gtarded

Both Southwest and WestJet are the leading budget carriers in their respective markets and the alliance has the potential to enhance the brand value of both the airlines due to some key factors. Here are some of these factors.

1. Greater choice - Just like global alliances of full-service airlines allow passengers access to routes not flown by a specific airline, but a partner carrier, this partnership will give customers of budget airlines in North America the same conveniences for the first time. Furthermore, like Tiger Airways in Asia and Air Berlin in Europe, this alliance will allow passengers to take multi-leg budget flights too.
2. One size fits all - Both Southwest and WestJet fly only Boeing 737s, which will ensure a consistent experience for passengers in either airline. Moreover, sometime in the future, as both these airlines operate from each others’ hubs, maintainability would be much easier too.
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   Tags: budget airlines, Southwest Airlines, WestJet Airlines
   

The InsideFlyer magazine published an article entitled “The FFPs of the Middle East” last September. Though on the face of it, the article compares the various FFPs among the leading airlines there, upon closer look, you also discover the nuances that enhance brand value for the customers of these airlines. As proven by the large number of airlines from the Middle East winning the Freddies earlier this year, there are surely lessons for grabs here.

Catering services specifically to customers’ needs ensures loyalty

The region is flush with oil revenues, and more rich Arabs are taking to the skies - flying business class and first class. Airlines in the region pamper this key segment of their customers. Etihad Airways just opened a plush business class lounge at Abu Dhabi airport and offers limousine pick-ups, like Emirates. Emirates is also the first airline to introduce showers on-board its new A380 first class cabin. Qatar Airways has gourmet meals catered to suit their frequent flyers. It is no wonder that programs like Emirates Skywards reports that the program’s current rate of growth is just over a member a minute.

More importantly, all of these airlines give a variety of options to their customers to en-cash their frequent flyer points - up to 600 options at Etihad! These include not just flight tickets and partner merchandise, but also specially catered experiences like weekend breaks and shopping to one-of-a-kind experiences such as a night with the paparazzi or tandem skydiving among many others.

In addition to pampering the super rich, the budget airlines in the region offer the millions of low-wage workers from South Asia, China and The Philippines to fly home without burning a hole in their pocket. Again, a number of these airlines are owned by the legacy carriers, and new ones are propping up very often. The latest is FlyDubai, being launched by Emirates.

Airline services and frequent flyer programs that actively cater to customers’ needs can have a huge leverage on airline’s brand loyalty, especially over time, as new competitors take to the skies. And this is demonstrated very well by the Middle East carriers.

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In service businesses like airlines, first impressions count. On my hour-long American Airlines flight last evening from Toronto to Boston, I was welcomed on-board by a cheerful flight attendant, Heather. She was genuinely pleasant (and not over-doing it) and extremely courteous, even though she was the only flight attendant on board the small Embraer jet. She played along when people were not paying close attention to the safety demonstration, and cracked jokes while serving beverages. A very pleasant experience - but that’s just one tenth of the job done for the airline when it comes to creating first impressions.

Creating lasting first impressions - a hundred million times

Air Canada’s Robert Milton mentions in his book that on average each passenger comes in contact with the airline ten times, every time he flies. This may be through the call center, website, at the check-in counter and of course, on-board the plane. So if an airline flies 10 million passengers per year, there would be a total of 100 million interactions on average! So how can airlines create a lasting first impression, every customer interaction? Here are three ways.

1. Exceed expectations. Before a customer interacts with an airline, he has certain expectations formed through advertisements, word-of-mouth or previous experiences. Airlines should aim to exceed them. Reduce the waiting time at the call center. Have pleasant check-in counter staff. Cater to the fliers’ needs on-board. This is not to say that each and every airline must spend millions in sprucing up service levels, but rather exceed the expectations they have set themselves. For example, budget airlines like AirAsia promise on-time performance and not in-flight luxuries. They then ensure these metrics are adhered to. Airlines like Thai Airways and Qatar Airways promise a pampered service for their business class passengers, and then deliver it. Prioritize, then execute and keep the word. Read the rest of this entry »

   

   Tags: AirAsia, American Airlines, Robert Milton, Virgin America
   

Everyone is now aware of the much criticized move by American Airlines to charge $15 for the first checked in bag, and $25 each for subsequent bags - a perfect example of the knee-jerk reactions we are getting used to from airlines. This is a one-way street for the passenger. What if oil goes down to $100 in two months? Surely the baggage fee will not be reduced. Sounds like a perfect recipe for disaster for customer confidence (if there is any left now).

Photo courtesy of http://www.worldrider.com/

Surely, there are better ways to deal with externalities than to squeeze out every nickle-and-dime out of the already exploited passenger. Airline executives in the US can learn some things from their counterparts in Asia (who’re still doing well in this environment) and also take some lessons in Economics. Here are three tips to get started: Read the rest of this entry »

I wonder what it would be like to take a flight on the new Northwelta from Boston to Singapore via Detroit and Tokyo on a Boeing 747, once the US$17 billion merger between Northwest and Delta comes through. Will I get the Northwest experience or a predominantly Delta one, a mish-mash or none?

There’s been a lot of chatter around the merger, though more negative than positive (check out the one by Center for Asia Pacific Aviation for a different view). But I’ve hardly read anything about how the merger would affect the brand. Even though the new airline (largest in the US with over 70,000 employees) will be operated under the Delta name, which currently doesn’t have any 747s and also doesn’t fly to Asia Pacific, the brand experience can certainly be enhanced to make the sum greater than the parts combined.

Here are five ways how Northwelta can leverage on the merger to boost its brand (something soon-to-be-merging airlines can keep in mind too). Read the rest of this entry »

Airlines are coming up with innovative ways to engage the customer, like SIA’s first flight to London graphic design competition we mentioned in this post. The next step into virtual user interaction would be to tap on the cutting edge of virtual worlds, which is led by Second Life.

A number of leading corporates have found interesting ways to tap on the bustling virtual communities on Second life, including Cisco, Adidas, ABN Amro Bank , MTV and even Toyota. Insead Business School has held MBS classes there. The hit CBS show “CSI: Crime Scene Investigations” plans an episode later this month where a killer is pursued into Second Life. One of the few industries not yet represented on Second Life is the airline industry - and herein lies a great branding opportunity for first movers and fast followers into the realm. Read the rest of this entry »

Since the late 1990s, many airlines have discarded First Class for Business class, or a mix of the two (think Delta and Air New Zealand). Of late, full-business carriers have come and gone (like SilverJet and MaxJet respectively). Now legacy carriers like Singapore Airlines and British Airways are looking to introduce Business-only flights on their long haul routes (click here to see inside the cabins of these airlines). So, what is it that makes business class tick, and how can airlines differentiate their product, as the top tier gets crowded.

First the three functional requirements of a business traveller:

1. Reliability + Frequency - on time performance and lots of options for timings
2. Flexibility - business travelers often like to change their plans at the last minute
3. Comfort - if the business traveler is able to have his own private space and get a week’s worth of work done on his laptop in-flight, he’ll not be too concerned with money Read the rest of this entry »

   

   Tags: Business class, EOS, Silverjet, Singapore Airlines