CO may be losing its way. Is it Jeff or what's up?
Mar 18, 2010, 8:27 am
#31
Join Date: Jan 2009
Posts: 599
They should take a look at the DirecTV product and see about making it free for elites (we've suggested that before).
Maybe they could take it a step further and make DirecTV free for all. Not sure how much the tradeoff would be (they would have to redo the contract) but maybe free DirecTV + BOB would work better than paid DirecTV + free food.
Maybe they could take it a step further and make DirecTV free for all. Not sure how much the tradeoff would be (they would have to redo the contract) but maybe free DirecTV + BOB would work better than paid DirecTV + free food.
Mar 18, 2010, 8:44 am
#32
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The Continental "worst to first" under Bethune, was legendary, and textbook. This guy's office paint isn't even dry, and he's talking tough. To Delta, a recent speech, somewhat reminiscent of Khruschevs We will bury you, at the start of the cold war. Then theres the in your face to the government. You fine us for stranding passengers, and well cancel the flight. You figure out how to get them home. The contrast with his predecessors is marked, and a bit juvenile. Keep your free meal, Jeff. The more you shrink the product advantage, and the worse you treat the customer, the lighter the loads. I know a lot of people who were willing to endure that sewer called Newark Liberty, for a better ride. Jeff should be careful what he wishes for. Founder, Bob Six, must be turning in his grave.
Mar 18, 2010, 8:45 am
#33
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They should take a look at the DirecTV product and see about making it free for elites (we've suggested that before).
Maybe they could take it a step further and make DirecTV free for all. Not sure how much the tradeoff would be (they would have to redo the contract) but maybe free DirecTV + BOB would work better than paid DirecTV + free food.
Maybe they could take it a step further and make DirecTV free for all. Not sure how much the tradeoff would be (they would have to redo the contract) but maybe free DirecTV + BOB would work better than paid DirecTV + free food.
Mar 18, 2010, 8:54 am
#34
Join Date: Mar 2009
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Wow, thanks for the info. It has been almost 8 years since I have flown CO int'l (and that was a reward flight to Lima, at that), and all int'l flights since then in coach have been AC. Now I have another occasion (besides removing shoes and pulling out the 1L baggie) to curse the terrorists!
Mar 18, 2010, 9:18 am
#35
Join Date: Sep 2007
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No free booze on international flights was one of the best decisions by airlines. I longer have to worry about having a drunk seatmate.
No food on domestic flights, no big deal. Never liked those chewy sandwiches. Cheeseburgers and pizzas were great but they have not been seen for a while. I would rather grab some food in the food court than buy airplane food.
As a plt, I am jumping for joy when CO announced selling the ELR seats. Since upgrades are hard to come by (less than 50% for a couple years already), it is nice to have a chance at exit row seats at check-in.
Personally, I believe CO in moving in the right direction. Unless, WE-CARE truly cares and CO does a better job handling IRROP situation, serving airplane foods and handing out a few blankets will not retain customers. Profitability is important. At least they won't spend $35 Million on food that everybody complains about. There is hope that they might even get a few millions from people desperate enough to pay for the food.
No food on domestic flights, no big deal. Never liked those chewy sandwiches. Cheeseburgers and pizzas were great but they have not been seen for a while. I would rather grab some food in the food court than buy airplane food.
As a plt, I am jumping for joy when CO announced selling the ELR seats. Since upgrades are hard to come by (less than 50% for a couple years already), it is nice to have a chance at exit row seats at check-in.
Personally, I believe CO in moving in the right direction. Unless, WE-CARE truly cares and CO does a better job handling IRROP situation, serving airplane foods and handing out a few blankets will not retain customers. Profitability is important. At least they won't spend $35 Million on food that everybody complains about. There is hope that they might even get a few millions from people desperate enough to pay for the food.
Mar 18, 2010, 9:42 am
#36
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I think CopperSteve would like this extended to free meal if you don't get the bump up (which despite denials by CO management is more and more rare), assurances that the longer leg room seats will indeed be available to elites BEFORE being sold (like the assurances that were not delivered with FC seats)...but yes CO does a good job of taking care of it's elites in general, but with these changes, I think everyone is a bit edgy of the other shoe to drop.
Mar 18, 2010, 9:47 am
#37
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I think ala carte pricing is far and away the smartest way to manage an airline. I have no problem with the move to baggage fees. I certainly don't feel like beverages should be free in the air (any beverage except maybe water). Why am I subsidizing your 4 diet cokes? It just doesn't make sense to me.
And I would even be in favor of not serving any food options, at all, in y (except maybe intl flights). It would reduce transaction costs and turn planes over faster.
And I would even be in favor of not serving any food options, at all, in y (except maybe intl flights). It would reduce transaction costs and turn planes over faster.
Mar 18, 2010, 9:49 am
#38
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The Continental "worst to first" under Bethune, was legendary, and textbook. This guy's office paint isn't even dry, and he's talking tough. To Delta, a recent speech, somewhat reminiscent of Khruschevs We will bury you, at the start of the cold war. Then theres the in your face to the government. You fine us for stranding passengers, and well cancel the flight. You figure out how to get them home. The contrast with his predecessors is marked, and a bit juvenile. Keep your free meal, Jeff. The more you shrink the product advantage, and the worse you treat the customer, the lighter the loads. I know a lot of people who were willing to endure that sewer called Newark Liberty, for a better ride. Jeff should be careful what he wishes for. Founder, Bob Six, must be turning in his grave.
Mar 18, 2010, 9:51 am
#39
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Yeah, NW didn't fail, it was bought out. Buy out's only work when there's something of value to buy.
Mar 18, 2010, 10:05 am
#40
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No market on earth is truly commoditized - not even gasoline. To an extent the notion of air travel being a commodity is becoming a self-fulfilling prophecy. My prediction is sometime soon there will be a "back to traditional values" move, either from one of the legacies, or maybe a new entrant, who will offer bundled products. They'll make money and everyone else will follow like lemmings. It's a fashion thing, but the winners will be the ones who lead instead of following.
Three class planes? Converting the front third of "coach" to "business" would allow an airline to offer a bundled product to flexible fare and as many elites as it wanted, while still offering a lowest, unbundled price in the back. They might also do things to increase differntiation like increase the seat pitch in "business" and trim back things like FF miles on deep discount "coach" fares since they're allegedly not motivated by loyalty anyway.
1) Many of the services are simply not that valuable. I'll accept that some might have flown CO for the free meals, but were they willing to pay even a small premium for them? The objective value of the turkey puck is maybe $1. Even if that covers the marginal costs of the turkey puck, is it worth offering for a dollar of revenue?
2) Those services that are valuable, are not valued by all. Free baggage transport is certainly valuable, but not by everyone. To charge a premium, you will pretty much need to fill the plane with those that value baggage transport. For CO, this would mean shifting away from their target, corporate customers.
You have to try and differentiate between those willing to pay for the services and those that aren't. I don't find a SK-style differentiation of the coach cabin any more elegant or likely to be effective than simply offering a la carte services. Indeed, I would think that the a la carte services, if done correctly, would likely lead to more revenue, as you would always struggle to find the right balance of services that people would be willing to pay for the whole bundle.
At the end of the day, I just find it hard to believe that, if people are unwilling to pay a fee for baggage transport or are unwilling to pay for the meal, that they will pay more to have it bundled into the ticket price. More accurately, I doubt that there are enough such people to fill the network of an airline the size of CO. Once airlines have to compete on price, even if it is only to fill maybe 10% of the plane, you open yourself up to the free-rider issue. Even those that value the add-on services should ultimately be unwilling to pay a premium if the carrier will have to sell some seats without that premium.
Mar 18, 2010, 10:45 am
#41
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They should take a look at the DirecTV product and see about making it free for elites (we've suggested that before).
Maybe they could take it a step further and make DirecTV free for all. Not sure how much the tradeoff would be (they would have to redo the contract) but maybe free DirecTV + BOB would work better than paid DirecTV + free food.
Maybe they could take it a step further and make DirecTV free for all. Not sure how much the tradeoff would be (they would have to redo the contract) but maybe free DirecTV + BOB would work better than paid DirecTV + free food.
Indeed, they had some great routes that DL wanted, including the NRT hub. But there were huge parts of the carrier that didn't hold value, hence the parking of planes and the significant cuts in the route structure. Hard to know if they would have survived on their own; definitely conjecture more than fact there.
Mar 18, 2010, 10:49 am
#42
Join Date: Jan 2009
Posts: 599
Even though there would probably be a sunk cost maybe LiveTV would drive more revenue better than the free food would. But it is a cost...
Mar 18, 2010, 11:23 am
#43
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They wouldn't have to rewrite the contract. It includes a clause for a specific dollar amount that CO can pay to make TV free on a flight for all customers. If the flight is delayed enough (and I don't know how long that is) the FAs are supposed to flip that switch and make it happen. I know that it has happened before. So CO would basically just be eating that number on every flight. I'm guessing that it is a discounted amount versus the full price the passenger pays but still probably more than CO wants to pay. And they don't seem to have much motivation to do so.
Indeed, they had some great routes that DL wanted, including the NRT hub. But there were huge parts of the carrier that didn't hold value, hence the parking of planes and the significant cuts in the route structure. Hard to know if they would have survived on their own; definitely conjecture more than fact there.
Indeed, they had some great routes that DL wanted, including the NRT hub. But there were huge parts of the carrier that didn't hold value, hence the parking of planes and the significant cuts in the route structure. Hard to know if they would have survived on their own; definitely conjecture more than fact there.
Mar 18, 2010, 11:44 am
#44
Join Date: Oct 2009
Posts: 41
True -- but the competition was worse than CO, so the changes to "bring the product in line with the competition" is making CO worse.
Mar 18, 2010, 1:45 pm
#45
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At the end of the day, I just find it hard to believe that, if people are unwilling to pay a fee for baggage transport or are unwilling to pay for the meal, that they will pay more to have it bundled into the ticket price. More accurately, I doubt that there are enough such people to fill the network of an airline the size of CO. Once airlines have to compete on price, even if it is only to fill maybe 10% of the plane, you open yourself up to the free-rider issue. Even those that value the add-on services should ultimately be unwilling to pay a premium if the carrier will have to sell some seats without that premium.