RyanAir has a new lounge at Stansted. And it’s for real! RyanAir is known for being creative about ancillary revenues. We all know about the much-discussed toilet charge. But did you know that RyanAir has recently opened a new lounge at Stansted Airport? For under 18 bucks, you get breakfast, wifi, sofas and even showers before you board your flight. And the lounge has received some rave reviews as well.Now this is a sort of service I’m sure many wouldn’t mind paying for – because it’s value-added charges, not charges for un-bundling, as is generally the case.AirAsia has a shop in a mall in KLForget about in-flight shopping – that’s old school and increases the aircraft’s weight. AirAsia now has not one, but two “kiosks” in Kuala Lumpur. One is at the LCCT itself, and a new one has come up at Pavillion Mall. They promise even more outlets soon! Here, you can buy AirAsia merchandise like plane models, t-shirts and even hand-bags.…

I often get asked by senior airline executives and readers of this blog, “How can we deal with real-world PR crises using social media?” Well, the recent war of words Facebook and Twitter posts between RyanAir and SAS Scandinavian Airlines offers a number of lessons in the matter.

For the unaware, here’s a a gist of what happened. Just a few weeks ago, Ryanair said it would offer SAS executives and board members “free tickets on any of Ryanair’s 100 Nordic routes”, then surprisingly rescinded the offer. Nevertheless, SAS’ Director of Communication and EVP, Claus Sonberg, made his first flight with Ryanair from Oslo to London, which could be followed via both Facebook and Twitter.

What was meant to be just an update about the flight experience turned out to be an online “shouting match” with Claus pointing out how RyanAir was more expensive and a “Fletcher Reede” constantly brought out RyanAir’s perspectives. So now, what are some lessons airlines can take away from this?

1. Integrate new media and old media
Something I feel SAS did quite well in this matter was to make …

Dear SimpliFliers,

It gives me great pleasure to announce that Donald Schenk, the President & CEO of Airline Capital Associates in New York, and Patrick Murphy, the Chairman, Aviation Group at Performance Consultants International and the former Chairman of RyanAir, have joined SimpliFlying’s Board of Advisors. It’s an honor to have them on-board our fast-growing team as Advisors.

As part of the Board of Advisors, Don and Patrick will be mentoring the SimpliFlying team on business strategy and share their wisdom about the nuances of the industry, given their combined experience of almost 100 years!
About Donald Schenk

Mr. Schenk founded ACA in 1989 after leaving Bankers Trust where he was a Managing Director in the Corporate Finance Department. At ACA he developed a large practice advising aerospace companies on market trends and financial services companies on due diligence reviews of both airlines and aerospace companies. In addition to his consulting practice, Mr. Schenk’s financial advice has been used by numerous airlines and aerospace companies. Internationally, his financial advice has been focused on the emerging markets. Mr. Schenk has also developed an extensive practice in corporate restructuring and aviation-related expert witness work.

Mr. Schenk’s expertise …

This is a guest post by Rob Mark from Jetwhine.com in Chicago. We’ve decided to begin a little cross-posting here at SimpliFlying and at Jetwhine.

A commercial pilot and journalist, Rob has been writing Jetwhine as the blog of “aviation buzz and bold opinion,” for two and a half years. His posts are never dull because you never need to try to figure out where he and his co-writer Scott Spangler stand on an issue. Enjoy.

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For as long as I can remember, Southwest Airlines, now the largest U.S. domestic airline, created in the 1970s by Herb Kelleher and Rollin King, has been the low-cost airline others most want to emulate. The need to copy isn’t just about money, although Southwest has a profit history better than any other airline in the world. Most Southwest look-a-likes have, in fact, been dismal failures.

Southwest has a record of solid labor relations – despite last week’s pilot contract rejection – and a culture of customer fun in an industry that most others have never been able to duplicate. Southwest simply delivers a solid, consistent service at a …

Note: This is a cross-post from Steven Frischling’s Flying with Fish blog, and the original can be read here. Steven Frischling, aka: Fish, is a self employed photographer, and founder of The Travel Strategist, who has flown approximately 1,000,000 miles since he began to track his mileage 2005.
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Everyday hundreds of thousands of travellers take to the internet to search for the lowest airfare for their travels. Eventually many of these travellers with find themselves at the website of a Low-Cost-Carrier (LCC) lured in by the promise of cheap fares…but really what the cost of flying with an LCC?

Irish carrier Ryanair is one of the most notable LCC’s in the world, with a network that operates from a staggering 32 ‘Hub’ airports. Ryanair is known for charging for everything…what exactly is ‘everything?’ well how about they charge you to check in for your flights…either online or at the airport…rates vary.

How do the rates vary? Well if you check in online, and you booked your ticket online your check in fee is €5 (US$6.75), but if you check in online but you booked your ticket via the telephone your check in fee is €10(US$13.50).

Can’t check …

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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 …

Image via Wikipedia

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I read an article about Tony Fernandes, the CEO of AirAsia, in The Economist today that got me thinking. Thinking about the last few articles I’ve written about United Airlines, RyanAir and Southwest Airlines – on how they make money off their customers – what what works and what doesn’t.

There’re a lot of airlines in the US and Europe can learn from Tony Fernandes and AirAsia (+ Azran and AirAsiaX). Here’s how the article in The Economist ended.
“Mr Fernandes says that he came to the industry with no preconceptions, but found it rigidly compartmentalized and dysfunctional. He wanted AirAsia to reflect his own unstuffy, open and cheerful personality. He is rarely seen without his baseball cap, open-neck shirt and jeans, and he is proud that the firm’s lack of hierarchy (very unusual in Asia) means anyone can rise to do anyone else’s job. AirAsia employs pilots who started out as baggage handlers and stewards; for his part, …

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I was reading through a popular airline forum this morning and was shocked the read the story of a United Airlines frequent flier, who was extremely frustrated by “hidden fees” the airline had imposed on him, and was desperately seeking advice on how to resolve the matter without further aggravation. Here’s Phil’s story (reproduced with permission):
“I purchased a ticket to Amsterdam last weekend with my miles. I booked over the internet and paid a $100.00 booking fee, along with the taxes on the flight.

I had to change my plans because of my mother’s surgery this week. So I called United and they said that I can do one of two things, hold my ticket without returning my miles -OR- pay an additional $150 to have my miles returned to my account.

Oh yeah, just to get the miles put back into my account and forget the hell about all of this, it’s an addition $150.00. I don’t get it, those are mine! And all they have to do is …

Continuing with the ancillary revenues special this March, I’d like to explore the issue whether ancillary revenues are good for the airline brand, or detrimental. We all know they’re good for the balance sheet, but what about the brand? To answer this question, let me segment ancillary revenues in two bands – charging for value addition, and un-bundling current product and services.
Charging the passenger for value-addition
A comment on the hotly debated article I wrote on RyanAir’s competition for charging passengers got me thinking. Here’s what Shyrose had to say:
“RyanAir should link up with the local taxi companies of the detination airports and agree a deal with them, whereby flyers can book their taxi on the plane so it’s ready and waiting for them the other side. Taxi companies give Ryannair a referral fee, and Ryanair will be positioned as offering greater value service for customers.”
And I think Shyrose is bang-on-target. Customers don’t mind paying for additional services they value. And this is especially true when the offer is in-sync with the brand expectation. There are ample examples of such value addition. Travel insurance and car rental are popular ones. The intelligent …

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[caption id="" align="alignright" width="320" caption="Source: RyanAir"][/caption]

It seems like RyanAir folks read SimpliFlying! Just when we’re having an ancillary revenues special this month, they’re giving us all the fodder to write about!

The airline has launched a competition where anyone in Europe can suggest ideas by email to competition@ryanair.com on how RyanAir can make more money off their customers! The best idea wins €1,000.

Some of the wackiest ideas are already stated on RyanAir’s website:

Charging for toilet paper – with O’Leary’s face on it,
Charging €2.50 to read the safety cards,
Charging €1 to use oxygen masks,
Charging €25 to use the emergency exit,
Charging €50 for bikini clad Cabin Crew.

An airline which laughs at itself
These days, companies, especially large, international ones that dare to laugh at themselves are a rarity. And an airline that can do that earns my respect. Others in those ranks? I’d say Southwest, JetBlue, Virgin America, Kulula.com, Indigo and AirAsia. Ironically, no legacy carriers made to this list. Do you know of any more?
A “cheap”, but authentic brand
Alright, many of you woul classify this RyanAir move as “cheap”. But isn’t RyanAir a cheap airline for the …