To American Airlines CEO Robert Isom all that matters at an airline is on-time performance. He says that is what makes seats seem comfortable and food taste better. The implication is if they can operate on time, they can skimp on everything else. Thus he tells employees not to spend a dollar they don’t need to.
Isom’s Chief Revenue Officer similarly believes the airline’s schedule is the product. Neither one seems to realize that these are table stakes. An airline needs to get passengers where they want to go reliably, but when customers have a choice they’ll select the airline that delivers the better product.
- There are customers that are pure price buyers. That’s the market Spirit Airlines and Frontier cater to.
- There are also coach passengers who will pay more for a better experience. And premium cabin customers are going to be paying substantially more to get a better product.
- High cost airlines like American, United and Delta need to appeal to customers that will spend more money. They need to earn a revenue premium since they aren’t going to be the low-cost producers of seats.
Etihad Salmon Biryani
United Airlines CEO Scott Kirby used to describe his airline’s schedule as its product but has changed his tune somewhat and is even restoring seat back video screens to older aircraft. When passengers see those screens the planes seem newer.
British Airways found that 25% of consumer decision-making is based on an airline’s brand and they lost sales when they degraded their product. They needed price and network but that wasn’t enough.
Oliver Ranson reviews the book Airline: Style at 30000 Feet by Keith Lovegrove and suggests “style and brand is just an important part of airline revenue generation as data & analytics – this book clearly shows why.”
Uniforms convey a sense of style. In the U.S. that extends only to Delta, though ‘passport purple’ has nothing on the red dress that preceded it.
Cost matters when it comes to food, hence the famous story about former American Airlines CEO Bob Crandall ordering the removal of an olive from first class salads to save $40,000 a year. The scale at which these meals are produced means small cost increments add up. However in the context of $5000 airline tickets small investments can yield outsized dividends in sales – while cuts to the experience can cause an airline to survive by discounting its best product (the way US Airways used to do with business class, and the model crept into thinking once they took over American).
Psychology matters a lot. People need to know they’re enjoying something premium, which is why caviar has historically been popular in international first class along with prestige name wines and champagnes (which may not be the best wines and champagnes, or best-tasting at altitude).
Cathay Pacific Caviar and Balik Salmon
Random passes along this story of failure,
In 2010 and 2011 Qatar Airways asked it’s business class passengers what they wanted and they said more luxury food. After evaluating a range of delicacies like caviar and quail’s eggs the management decided that foie gras was the way to go. Unfortunately, when it went on board hardly anybody touched it.
In a restaurant many people look at food through the prism of menu prices. They eat the foie gras and find it delicious. But when the delicacies are free, the same people decide that they do not like liver and it gets thrown away. I was told that Qatar Airways had to throw away rather a lot of foie gras in 2012.
Personally I very much enjoy seared foie gras, less so foie pâté. It mattes too what kinds of food is served because taste is different at altitude and because many foods are being reheated. Soups and dishes in sauce stay moist and reheat well.
Singapore Airlines Business Class Laksa
ANA Ramen
This takeaway in the book may seem foreign to U.S. passengers used to the soft bigotry of low expectations that goes along with U.S. airlines,
Back on the ground, airline food is a popular subject among the recently disembarked clientele; if refreshments are poor the message gets passed on – a good enough reason to choose an alternative airline for the next trip. Conversely, if the food is appreciated then recommendations ensue.
Having flown Air Canada business class long haul this month I was struck by how the last meal of the flight is often an afterthought, but it’s also the last impression of the flight. North American carriers skimp on breakfast especially. While there was a choice of breakfast entree, trays were set up with a cold croissant still in shrink-wrapped packaging. It was truly sad, and something that’s a comparably easy fix.
