A Fee to Avoid A Fee?

Posted: August 5, 2010 in Business
Airline travel used to be fun and I used to look forward to the trip more than the destination. But alas no more…
Now many airlines are making money from their own operational failures by leveraging fees on unwary passengers is just an indication that they have lost the important component of the business-to-customer relationship.
Instead of taking a bold re-assessment of their business model and executing a strategy based on creating long-term customer relationships, they are replacing lost revenue via an obscure and non-transparent fee structure in addition to their existing ticketing revenue process.
The airlines argue that this is necessary because passengers are fickle and extremely price-conscious. That may be so, but it is in fact very possible to maintain minimum service standards that are customer-focused and still have enough left to fuel the aircraft and pay the staff.
The real challenge is an unwillingness to engage in organizational self-reflection and a fear of trying something new.
Which is conversely why Southwest Airlines is doing so well. Sticking to core values and executing on high standards has resulted in Southwest being both profitable and well-liked by its customers. Something that the rest of the airline herd should consider now that it has an example that being different and good pays off.

The fact that many airlines are making money from their own operational failures by leveraging fees on unwary passengers is just an indication that they have lost the important component of the business-to-customer relationship.

Instead of taking a bold re-assessment of their business model and executing a strategy based on creating long-term customer relationships, they are replacing lost revenue via an obscure and non-transparent fee structure in addition to their existing ticketing revenue process.

The airlines argue that this is necessary because passengers are fickle and extremely price-conscious. That may be so, but it is in fact very possible to maintain minimum service standards that are customer-focused and still have enough left to fuel the aircraft and pay the staff.

Something that the rest of the airline herd should consider now that it can see that being different and good at what you do pays off.

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