JetBlue TrueBlue - JetBlue Charting Corporate Course

The company is realizing that they need higher fare corporate customers

JetBlue Charting Corporate Course (http://www.btnmag.com/businesstravelnews/headlines/article_display.jsp?vnu_content_id=1003560412)

No talk about beefing up customer service? No talk about getting rid of the mommies and retirees who work parttime (24 hours/WEEK) and replacing them with 24 hour/DAY call centers? No recognition of the changes which need to be made after these debacles of the past two months?

Wow.....talk about not having a clue to the pulse of the customer. Our firm is no longer flying B6 until changes in customer service have been made and tested during bad weather conditions or any other problem which causes an increase in customer contact with the airline.

Neeleman just can't stay focused.

First he starts an LCC. He thinks that by acting cool it can attract sufficient 20-somethings business and leisure travelers to make money. And that works. So he orders hundreds more airplanes. Tries to grow faster than any airline in history save PeoplExpress.

Then fuel more than triples in price, his second fleet type experiences the expected hiccups and the losses begin. Just as the legacies are solving their post-September 11 financial woes (during which, B6 was actually making money as a small, niche airline).

Now, all of a sudden, amid a horrific operational meltdown and textbook case on how not to deal with it (primarily the multi-day delay in accepting responsibilty), Neeleman once again discusses the possibility of changing the business model - so that B6 can try to be all things to all people. Huge mistake.

Failure to focus. Simple as that. Instead of focussing on how to profitably do what they set out to do, the focus appears to have changed into "how do we grow this airline as fast as humanly possible, while turning our losses into profits?"

Attract large numbers of business travelers? I'm skeptical. With sufficient perks and discounts, some business travelers can be convinced. But without a link to a major international airline, few business travelers who fly domestic and international trips are gonna split their travel between B6 and their preferred alliance. Why? Elite status. And AA, CO, UA, DL, NW and even US realize that and will successfully exploit that advantage.

Good luck, B6. You're gonna need it.

No talk about beefing up customer service? No talk about getting rid of the mommies and retirees who work parttime (24 hours/WEEK) and replacing them with 24 hour/DAY call centers? No recognition of the changes which need to be made after these debacles of the past two months?

How many times do you need to say this, we get the point, you think Jetblue needs a professional call center.

"We're in the process of rolling out a program, such that if you call the day before a flight and book a $399 ticket for transcon, I want that person sitting in the front of the airplane in an aisle seat"

It's about time the highest fares bought something other than a middle seat.

Neeleman said the carrier also is testing "with a couple of corporations" refundable fares. "If you want to pay us more money, we'll give you something that's refundable and changeable,"

Another good move.

The last move to make B6 corporate-friendly would be double credit for corporate bookings.

Incidentally, as late as 2006 when I wanted to fly B6 I had to book it myself and get a nastygram for not using corporate travel, or I had to phone corporate travel and have them phone JetBlue. They had no ability to book B6 on their computers. And this was a huge corporate travel department, serving thousands of employees. B6 dropped the ball to fall off the corporate screen like that.

I wonder how long it will take one of the following to happen:

-jetBlue to sign Invol/re-protect agreements for irregular ops
-Corporate travellers realizing jetBlue has no Invol/re-protect agreements for irregular ops and bailing on jetBlue

Neeleman just can't stay focused.

First he starts an LCC. He thinks that by acting cool it can attract sufficient 20-somethings business and leisure travelers to make money. And that works. So he orders hundreds more airplanes. Tries to grow faster than any airline in history save PeoplExpress.

Then fuel more than triples in price, his second fleet type experiences the expected hiccups and the losses begin. Just as the legacies are solving their post-September 11 financial woes (during which, B6 was actually making money as a small, niche airline).

Now, all of a sudden, amid a horrific operational meltdown and textbook case on how not to deal with it (primarily the multi-day delay in accepting responsibilty), Neeleman once again discusses the possibility of changing the business model - so that B6 can try to be all things to all people. Huge mistake.

Failure to focus. Simple as that. Instead of focussing on how to profitably do what they set out to do, the focus appears to have changed into "how do we grow this airline as fast as humanly possible, while turning our losses into profits?"

Attract large numbers of business travelers? I'm skeptical. With sufficient perks and discounts, some business travelers can be convinced. But without a link to a major international airline, few business travelers who fly domestic and international trips are gonna split their travel between B6 and their preferred alliance. Why? Elite status. And AA, CO, UA, DL, NW and even US realize that and will successfully exploit that advantage.

Good luck, B6. You're gonna need it.

I respectfully disagree wtih you on much of the above.

The problems with the E190 were expected, as you do mention. However, Embraer reimbursed jetBlue for much of its related losses. This is common with any new airplane being introduced. You think this was bad? Just wait for the A380 with larger, international airlines!

How is jetBlue changing the business model to be "all things to all people"? As far as I see it, the business model has pretty much been the same since the first day with some moderate changes along the way, the addition of the E190 most notably one of the biggest. JetBlue still has its niche...the company focuses on LOW COSTS while offering GOOD VALUE. JetBlue is not a cheap airline - they are not expensive either. They offer good value to customers. Being all things to all people would be flying to every city in every state, country, etc...offering first class, elite, etc. JetBlue is a single-class customer friendly airline serving ~50+ cities in the US, Caribbean and Mexico. That's hardly "all things to all people". Going after the business market a little more aggressively is no big deal - after all, ORD was the MOST requested city for jetBlue to serve. I guess those "20-something's" made a statement. After all, routes such as CLT-JFK, BOS-JFK and others are performing well above expectations. Note: These are primarily business markets.

JetBlue is not growing "as fast as humanly possible" as you say. You fail to recognize the fact that the company has recently scaled back its growth plans. Yes, they are still growing - but at a somewhat slower pace than before...in addition to selling off a few A320s. The RTP has shown great results thus far and as a cost-focused airline, jetBlue is destined for long term success. The stock took a hit - but it needed it, as it got ahead of itself.

Controlled growth is what jetBlue focuses on now. JetBlue still has the best coach product out there...

I wonder how long it will take one of the following to happen:

-jetBlue to sign Invol/re-protect agreements for irregular ops
-Corporate travellers realizing jetBlue has no Invol/re-protect agreements for irregular ops and bailing on jetBlue

A long, long time. Proof: Many (but certainly not all) corporate travelers have no trouble flying Southwest. The ones that avoid Southwest have reasons other than this. Besides, legacy airlines will hardly ever Rule 240 you to another airline these days. Rule 240 protection is mostly a placebo.

A long, long time. Proof: Many (but certainly not all) corporate travelers have no trouble flying Southwest. The ones that avoid Southwest have reasons other than this. Besides, legacy airlines will hardly ever Rule 240 you to another airline these days. Rule 240 protection is mostly a placebo.

I had a feeling someone would mention WN. As you well know nsx, WN runs a much lower average load factor (though it has been creeping up) than jetBlue. So when something happens, there is actually space on their planes to reaccommodate passengers. Plus they let their planes sit at night, preventing the snow......g (compounding) of operational problems that B6 seems to experience. Not to mention the much more comprehensive nationwide route network that Southwest has, where there are many more options for rerouting on their own route system compared to jetBlue.

I had a feeling someone would mention WN. As you well know nsx, WN runs a much lower average load factor (though it has been creeping up) than jetBlue. So when something happens, there is actually space on their planes to reaccommodate passengers. Plus they let their planes sit at night, preventing the snow......g of operational problems that B6 seems to experience. Not to mention the much more comprehensive nationwide route network that Southwest has, where there are many more options for rerouting on their own route system compared to jetBlue.

Excellent points. You're right that if B6 runs 2 or 3 flights a day on a long haul, and if they are reasonably full, some people are going to be stranded for quite a while.

Neeleman just can't stay focused.

First he starts an LCC. He thinks that by acting cool it can attract sufficient 20-somethings business and leisure travelers to make money. And that works. So he orders hundreds more airplanes. Tries to grow faster than any airline in history save PeoplExpress.

Then fuel more than triples in price, his second fleet type experiences the expected hiccups and the losses begin. Just as the legacies are solving their post-September 11 financial woes (during which, B6 was actually making money as a small, niche airline).

Now, all of a sudden, amid a horrific operational meltdown and textbook case on how not to deal with it (primarily the multi-day delay in accepting responsibilty), Neeleman once again discusses the possibility of changing the business model - so that B6 can try to be all things to all people. Huge mistake.

Failure to focus. Simple as that. Instead of focussing on how to profitably do what they set out to do, the focus appears to have changed into "how do we grow this airline as fast as humanly possible, while turning our losses into profits?"

Attract large numbers of business travelers? I'm skeptical. With sufficient perks and discounts, some business travelers can be convinced. But without a link to a major international airline, few business travelers who fly domestic and international trips are gonna split their travel between B6 and their preferred alliance. Why? Elite status. And AA, CO, UA, DL, NW and even US realize that and will successfully exploit that advantage.

Good luck, B6. You're gonna need it.

There's a long list in the airline annals of companies which tried to "remake" themselves, and significantly change their customer base to include higher-fare paying corporate customers...

Just a few...

Midway (and the Midway Metrolink experiment)
Air Florida (began installing First Class in some planes before they went belly-up)
People Express (also began installing First Class)
Laker Airways (the original) (tried to shed its LCC image and go after the higher fare paying business market between the US and the UK)

I am sure there are plenty more...

How many times do you need to say this, we get the point, you think Jetblue needs a professional call center.

They do, among other important things.

The company is realizing that they need higher fare corporate customers

JetBlue Charting Corporate Course (http://www.btnmag.com/businesstravelnews/headlines/article_display.jsp?vnu_content_id=1003560412)

Not surprising at all. Focusing on leisure travellers only goes so far. And I still say focusing just on coach only goes so far.

It will be interesting to see if all seats up front will be blocked till closer to departure time or just some of them. And if there happen to be none available, will pax with lower fare tickets be kicked out of a 36" aisle seat? Put another way, will full fare pax be guaranteed a 36" aisle seat?

Also, on red-eye transcons I prefer window seats. Will those be held for full fare pax?

B6 really should update is web page however.

Under Corporate Travel / Why JetBlue: "There's no need to sign on the dotted line to get a good deal. With CompanyBlue, there's no hassle, no negotiations, no strings attached-just the best deals up front and tons more for your corporate dollar."

Yet in the referenced article he says "I've never been a rule guy that much," he said. "To the extent that someone walked in and said, 'I got a 100 people a day going here. If you give them this fare, I'll give you them all.' I'll say, 'All right, let's take a look at it.' I think we should be flexible in everything we do."

I guess he's willing to negotiate after all.

Under Corporate Travel / Average Fares it lists "Our average and walkup fares are consistently low every time, every day - in every single market we fly.".

However we know that fares have been more of a high-low strategy, not the cheapest fares are available from day 1 of booking.

He shouldn't say stuff that contradicts what's on the webpage.

No talk about beefing up customer service? No talk about getting rid of the mommies and retirees who work parttime (24 hours/WEEK) and replacing them with 24 hour/DAY call centers?

So you would rather foreign call centers staffed by people with suprisingly american names yet only a faint grasp of the english language and almost no ability to go "off script"? Personally there has been nothing more frustrating for me than trying to work with the "call center employees" that US Airways makes you use ... the most simple of questions and tasks becomes a massive undertaking because of a massive language barrier between "Sam" and myself.

I would 100% agree that B6 needs more customer service agents and also needs an updated phone system (the reliance on dial-up was shocking to me as an IT guy) ... but seriously ... as long as the CS agents do their jobs (which ... at least in my book ... includes being understandable and helpful) who cares who exactly is doing the work and how long their work week is? I would gladly take a Mommy or Retiree anyday of the week when my other option is a foreign call center ...

I view the US-based customer support to be a selling point for B6 ... and ... while I havent had to call customer support during a major service outage, my experiences with customer support have been nothing but good in the past when I have had to call.

(the reliance on dial-up was shocking to me as an IT guy)

From a jetBlue job listing (https://jetblue.recruitmax.com/ENG/candidates/default.cfm?szCategory=jobprofile&szOrderID=15575&szCandidateID=0&szSearchWords=&szReturnToSearch=1&cfidc=c7238) dated 3/20/07 for home-based reservations agents in SLC, UT area:

"Provide one telephone lines and a high-speed internet connection (minimum 256K connection speed)"

So, the dial-up rumor turns out to be a false one. Just setting the record straight.

It's not about sitting in the front rows or even lower fares (which JetBlue often doesn't have anyway). Business travelers want frequent flights throughout the day, easy ticket changes/standby rules, an interlining agreement, and a meaningful frequent flyer program. I don't think JetBlue is even close to providing any of these things. And that's over and above a basic level of confidence in the airline's operational skill.

I do think Neeleman shows an extraordinary, maybe airline-killing, lack of focus and discipline here. His "I'm not a rules guy" remark ought to terrify B6 boosters. It shows the core proposition / business plan, which was working, more or less, in the early days and is still valid, is up in the air. The whole deal is built around a few simple rules.

When PeopleExpress started installing first class in a futile and desperate attempt to attract business travelers, it signalled that the company was well and truly in a death spiral. Lack of focus; lack of confidence in the core product that got you to the party. I think PE was wiped out before the conversions were even completed.

JetBlue needs more focus and discipline, more belief in and support for a uniform high-quality coach product, more rules... not less.

BTW, when I bought a last-minute $409 transcon ticket on B6 a couple of months ago, I was told there were only two seats left on the plane, but I got an exit row aisle... about the best seat in the house. So it looks like they already hold back better seats for higher-paying customers.

It's not about sitting in the front rows or even lower fares (which JetBlue often doesn't have anyway). Business travelers want frequent flights throughout the day, easy ticket changes/standby rules, an interlining agreement, and a meaningful frequent flyer program. I don't think JetBlue is even close to providing any of these things. And that's over and above a basic level of confidence in the airline's operational skill.


Exactly right.

I do think Neeleman shows an extraordinary, maybe airline-killing, lack of focus and discipline here. His "I'm not a rules guy" remark ought to terrify B6 boosters. It shows the core proposition / business plan, which was working, more or less, in the early days and is still valid, is up in the air. The whole deal is built around a few simple rules.

The reason for this change is that growth is coming harder to come by. There are still some places where they can show up and fill up a plane. However those places are becoming harder and harder to find.

When you look at routes like JFK-SEA where service is being cut back on certain days, it is clear that getting organic growth on existing routes is a problem for B6. Thus the push on moving from what's 'worked' in the past because it really hasn't worked as well as it should have.

Take a look at how many existing routes have gotten new service and it pales in comparison to how many cities have new service. Getting more out of existing cities needs to be a core component of future growth; there are only so many cities to fly to, at some point it runs dry, I think B6 is close to that point now.

How many times do you need to say this, we get the point, you think Jetblue needs a professional call center.I am responding to this thread about the CEO's view of what the "corporate course" should be. Nothing wrong with that. If you don't like my responses, there is the "ignore" feature. ;) Why subject yourself to my words?
With sufficient perks and discounts, some business travelers can be convinced. But without a link to a major international airline, few business travelers who fly domestic and international trips are gonna split their travel between B6 and their preferred alliance. Why? Elite status. And AA, CO, UA, DL, NW and even US realize that and will successfully exploit that advantage.Interesting you say that. I threw those concerns away because I loved the Jetblue product. The seat pitch, the satellite TV, the leather seats, the friendly and happy FAs....they made me look forward to travelling. But when this falls apart due to a weather situation, forget it. When I was with CO, I never had a problem reaching customer service during hurricanes, snow storms, and other weather conditions. The customer service for elite status flyers like me wasn't a group of part-timers in SLC. So maybe accruing miles once again for int'l flights has come around again as something quite attractive. I'll trade a few inches of pitch for service.
So you would rather foreign call centers staffed by people with suprisingly american names yet only a faint grasp of the english language and almost no ability to go "off script"?YES! I deal with many of these call centers on a daily basis; IBM anybody? :p When I get someone whose accent I can't understand, I ask for that person's manager. Done. I'd rather deal with an overseas center than some cheap operation of American homebodies working part-time and not available during high-volume, critical moments like during bad weather.

The fact that the CEO didn't even MENTION the failure of his customer service parttime homebodies tells me he has no intention of improving customer service. I'd rather him say that he's going to outsource overseas to verify that Jetblue can indeed handle the call volumes.

There are still some places where they can show up and fill up a plane. However those places are becoming harder and harder to find.... When you look at routes like JFK-SEA where service is being cut back on certain days, it is clear that getting organic growth on existing routes is a problem for B6.

Interesting that you should bring up the JFK-SEA cutbacks this fall, because I think that's exactly the wrong thing to do in any case... and especially if JetBlue wants business travelers.

When Southwest opens a new station they don't try one or two flights, toe-dipping style, to see how it works. They storm the airport like crazed Spartans -- and it usually works great.

I'm out here in Seattle. You know how much marketing JetBlue does to generate traffic here? Zilch. I've never heard a B6 radio spot in Seattle, never seen a B6 billboard, never had a piece of direct mail with a $10-off coupon, nothing. You have to go out to the airport and see their ticket counter, which is dark/unstaffed until 730p each night, to know they even exist here. This is an uncultivated market. No wonder they're cutting it back (based on last year's traffic!). Southwest, meanwhile, is all over the place -- paid media, event sponsorships, ballpark billboards, you name it. Market the hell out of the product, pour awareness into this market, and you could fill four A320s a day to JFK and the east. Do nothing and you find yourself timidly cutting back the only redeye (ycch) you've got.

Don't have enough aircraft to run that play in ten west coast stations (and they have ten)? Pick three or four and close the rest. Place a bet.

The proper thing to do is flood the zone, not retract. If you display a defeatist, ooh-we-can't-fill-the-planes mentality you will be defeated. If you scale the castle walls like its win or die, you will win.
Getting more out of existing cities needs to be a core component of future growth; there are only so many cities to fly to, at some point it runs dry. Well, at some point you have to go from generating new traffic to stealing existing traffic from competitors. I'm in a creative / professional services business. When times are good there is plenty of work for everybody. When they're not, the work is still out there; you just have to rip it out of some other agency's hands. Not so different in the airline biz.

Lastly, if you want any prayer of attracting / retaining higher paying business traffic, the single stupidest thing you can do is cut back to less-than-daily service.

I think it's at least 50/50 that JetBlue will have to close some of these ten west coast stations in the coming year because of yield and aircraft utilization issues. And they will have defeated themselves!

Don't have enough aircraft to run that play in ten west coast stations (and they have ten)? Pick three or four and close the rest. Place a bet.

Several times in this forum I have recommended a depth (rather than breadth) of service strategy for B6. Southwest wins high-traffic markets this way. For travel between northern California and southern California you cannot beat their frequency of service. That, above all else, wins high-fare business travelers. The E190s can really help B6 implement a depth of service strategy.

The 190s could be the saving grace or the dagger that continuly inflicts deep wounds. We'll see how much the 190s dispatch reliability improves after they get the software upgrade. Hopfully the upgrade is just what they need to solve the problems they have. Rumor has it Airbus is offering us a sweet deal if we give back the 190s and go for the 319s. I haven't heard anything concrete about the offer, only rumors and you know how rumors spread.

Rumor has it Airbus is offering us a sweet deal if we give back the 190s and go for the 319s. Take it, quick, before they change their mind!

The reason for this change is that growth is coming harder to come by. There are still some places where they can show up and fill up a plane. However those places are becoming harder and harder to find.

When you look at routes like JFK-SEA where service is being cut back on certain days, it is clear that getting organic growth on existing routes is a problem for B6. Thus the push on moving from what's 'worked' in the past because it really hasn't worked as well as it should have.

Take a look at how many existing routes have gotten new service and it pales in comparison to how many cities have new service. Getting more out of existing cities needs to be a core component of future growth; there are only so many cities to fly to, at some point it runs dry, I think B6 is close to that point now.

Only 1 problem I dont think JB was looking to do with SEA as it has with LGB. The Red-eye works great for them in that otherwise most likely the plane wouldnt be used for anything else. During the rest of the day they have to place it and make their $$$.

Also JB really doesnt belong in the Long Haul biz, theres alot of places they can still make a good $ flying to out of JFK and alot closer. Thats why they reduced ONT to the timing as SEA, they did start out with a few flights.

Rumor has it Airbus is offering us a sweet deal if we give back the 190s and go for the 319s.


I hear Airbus would love to make some deals on the 380s, too.

No talk about beefing up customer service? No talk about getting rid of the mommies and retirees who work parttime (24 hours/WEEK) and replacing them with 24 hour/DAY call centers? No recognition of the changes which need to be made after these debacles of the past two months?

Analise, please return to the hanging up on 1800 JetBlue post and take a look at the last few posts regarding res agents.. Not all are part time, not all are at home.

People have always been asking for refundable fares. It is one of these most requested items from JetBlue, besides start flying to Chicago. The company is starting to look into providing these fares, in addition to fixing the problems at hand. David just put out a video to crewmembers in which he listed the items that are being addressed. Of those include, website/server issues, phone issues, new software for the crew scheduling department and the list goes on.

without a link to a major international airline, few business travelers who fly domestic and international trips are gonna split their travel between B6 and their preferred alliance. Why? Elite status.


^ Truer words were never spoken!