On any typical morning at Luton the airport bustles with people rushing for flights. However the contrast with say 10 years ago or more is startling. It is the dress of the passengers.
What used to be an almost exclusively for Leisure market with loads of families and couples off to sun destinations now sees a very different crowd. The business person is now more than likely to be that group who occupies the security lines. (Not the check in lines as everyone has previously checked in if they are biz people).
Easyjet deserves a lot of the credit for this. Taking the low cost model to business markets is driving the differentiation between them and Ryanair. It is also driving greater revenue per passenger - but also greater costs. Easyjet is now deploying technology to improve the quality of the checkin process. In a story carried by ABTN, an Easyjet Spokesman commented: "We are evaluating the technology as to how it can speed up the check in process."
"It allows our staff to have more contact with passengers, providing a faster and more informative service.
"We will never get rid of check-in desks like some other airlines have done in the past," he said.
CapGemini in a recent piece on its concept of Mobile Service Partners combining to deliver services to the consumer via any mobile devices estimates that by the year 2030 almost all travel customers will use some sort of mobile Information and Communication (I&C) device to handle their travel arrangements, independent of the larger computing devices such as PCs and laptops. The formal line between the customer and the supplier provider will blur making some of these services less necessary.
Who knows maybe Ryanair will be right in the end. But for now - in the customer service stakes - Easyjet seems to have the ascendancy. So more and more of those Easyjetters will be biz folks.
07 March 2010
04 March 2010
BA Tries New Cost Measures
A great piece in the Beat this week on BA's new compensation program in the USA indicates a different tack by BA in its way to try and reform its business.
Having essentially rolled over on the issue of GDS fees - it is going after - let's call them softer targets. There is a lot of fodder in the battle with the Flight Attendants - who probably have lost the hearts and minds of the consumers. BA in my opinion now has the ascendancy in that battle. So now it is going after a revised compensation plan against the agency community. This time the US TMCs.
Given the importance of the business market to BA's bottom line (particularly after the disastrous 2009) this might be a risky strategy. Given the spring shoots now appearing in the USA - it would seem unwise to stifle the growth and upset this group of people. But perhaps it feels emboldened by the pending BAAAIB alliance approval and the resulting synergies - particularly in the business market to the UK. Given the relatively small footprint by Star on the UK - US market and the paucity of Skyteam flights (just 2 767s a day between LHR and JFK) perhaps they can throw their weight around.
However I do hope someone from the DoT is paying attention. The reduction/absence of competition on the Transatlantic run does seem to allow behavior like this.
This is my opinion and take it for what its worth
Cheers
Having essentially rolled over on the issue of GDS fees - it is going after - let's call them softer targets. There is a lot of fodder in the battle with the Flight Attendants - who probably have lost the hearts and minds of the consumers. BA in my opinion now has the ascendancy in that battle. So now it is going after a revised compensation plan against the agency community. This time the US TMCs.
Given the importance of the business market to BA's bottom line (particularly after the disastrous 2009) this might be a risky strategy. Given the spring shoots now appearing in the USA - it would seem unwise to stifle the growth and upset this group of people. But perhaps it feels emboldened by the pending BAAAIB alliance approval and the resulting synergies - particularly in the business market to the UK. Given the relatively small footprint by Star on the UK - US market and the paucity of Skyteam flights (just 2 767s a day between LHR and JFK) perhaps they can throw their weight around.
However I do hope someone from the DoT is paying attention. The reduction/absence of competition on the Transatlantic run does seem to allow behavior like this.
This is my opinion and take it for what its worth
Cheers
Jetstar Follows Ryanair Model - Attacks Airports
Jetstar which is the low cost airline of the Qantas Group (heck it even says so now on some of its planes like the A330s) has taken a leaf out of the Ryanair playbook in picking on airports.
After its very public spat with Darwin last year - it has now picked on a smaller airport - Rockhampton. Pulling out its big PR guns - the airline is now pulling flights and denouncing the airport pretty much as the devil incarnate.
What is rather funny in all this - as soon as it announced the decision to pull back on the Brisbane to Rockhampton route - its flights were immediately replaced by Tiger Oz. Oh yes and by QantasLink...
Go figure
Cheers
After its very public spat with Darwin last year - it has now picked on a smaller airport - Rockhampton. Pulling out its big PR guns - the airline is now pulling flights and denouncing the airport pretty much as the devil incarnate.
What is rather funny in all this - as soon as it announced the decision to pull back on the Brisbane to Rockhampton route - its flights were immediately replaced by Tiger Oz. Oh yes and by QantasLink...
Go figure
Cheers
IATA finally acknowledges LCC market
Acknowledging that that there is actually a low cost airline model - IATA has (begrudgingly) started to include LCC statistics in its reporting. Don't believe me? I quote directly from IATA's stats:
"As IATA member airlines carry 93% of international traffic measured by RPKs, this change does not make a large difference in the statistics" IATA Jan 2009 Report. I think I bed to differ. The LCC model has a profound effect on airline statistics.
Interestingly IATA seems to only capture those pure LCC airlines. They so far admit that there is only 7% of total traffic being LCC. And this is where there is a pretty fundamental failure of the IATA statistical model. It measures that notional value RPK (RPMs). IE Revenue Passenger Miles. If for no other reason than everyone else uses passengers as a measure of total traffic it is high time that IATA woke up and started publishing some real data on passenger numbers.
IATA claims that LCC traffic is only "7%" of total traffic. Given that the vast majority of LCC passengers are short haul and only a smattering of long haul traffic this is starting to distort the figures. Let me illustrate this.
The total traffic worldwide (using ACI data) is estimated at 4.5 billion passengers these are actual landings and take offs. This number tends to be inflated as it includes and counts each passenger twice. One take off and one landing. So in my opinion there are actually around 2.2 billion actual worldwide passengers. (PSJs - for Passenger Segment Journeys). If we look at just one group - the ELFAA - European Low Fares Airlines Association which comprises: Vueling | easyJet | flybe | Jet2.com | Norwegian | Ryanair | Sky Europe | Sterling | Sverige Flyg | transavia.com | Wizz Air
They carried 162 million pax last year. And this is not all (but it is most) EU carriers. If we were to add back in MENA, Africa, Asia Pac, USA and Latam carriers the numbers would swell by at least double. (WN alone is now more than 100 million pax). So you can see the share of market pax worldwide by true LCCs is higher than the 7% shown using the RPK model.
Interestingly if we look at an apple to orange comparison - according to IATA's numbers total traffic (in RPKs) was down nearly 11% for Europe in 2009. But for ELFAA airlines (passengers flown) it was up 8.7%. Interestingly IATA claims that the impact of LCCs mitigated the annual fall in traffic by one full percentage point. IE LCC growth saved the world from a full percentage drop of 1 %.
For the long term - you have to make the assumption there is a move towards hybrid value carriers - where airlines move away from pure legacy full network service carriers and pure LCC models to hybrids of all types. An apple to apple comparison of say United Airlines revenue models looks remarkably similar to say Easyjet these days.
Now I am sure that some people may pick at my numbers but - the analysis is sound I believe.
Cheers
"As IATA member airlines carry 93% of international traffic measured by RPKs, this change does not make a large difference in the statistics" IATA Jan 2009 Report. I think I bed to differ. The LCC model has a profound effect on airline statistics.
Interestingly IATA seems to only capture those pure LCC airlines. They so far admit that there is only 7% of total traffic being LCC. And this is where there is a pretty fundamental failure of the IATA statistical model. It measures that notional value RPK (RPMs). IE Revenue Passenger Miles. If for no other reason than everyone else uses passengers as a measure of total traffic it is high time that IATA woke up and started publishing some real data on passenger numbers.
IATA claims that LCC traffic is only "7%" of total traffic. Given that the vast majority of LCC passengers are short haul and only a smattering of long haul traffic this is starting to distort the figures. Let me illustrate this.
The total traffic worldwide (using ACI data) is estimated at 4.5 billion passengers these are actual landings and take offs. This number tends to be inflated as it includes and counts each passenger twice. One take off and one landing. So in my opinion there are actually around 2.2 billion actual worldwide passengers. (PSJs - for Passenger Segment Journeys). If we look at just one group - the ELFAA - European Low Fares Airlines Association which comprises: Vueling | easyJet | flybe | Jet2.com | Norwegian | Ryanair | Sky Europe | Sterling | Sverige Flyg | transavia.com | Wizz Air
They carried 162 million pax last year. And this is not all (but it is most) EU carriers. If we were to add back in MENA, Africa, Asia Pac, USA and Latam carriers the numbers would swell by at least double. (WN alone is now more than 100 million pax). So you can see the share of market pax worldwide by true LCCs is higher than the 7% shown using the RPK model.
Interestingly if we look at an apple to orange comparison - according to IATA's numbers total traffic (in RPKs) was down nearly 11% for Europe in 2009. But for ELFAA airlines (passengers flown) it was up 8.7%. Interestingly IATA claims that the impact of LCCs mitigated the annual fall in traffic by one full percentage point. IE LCC growth saved the world from a full percentage drop of 1 %.
For the long term - you have to make the assumption there is a move towards hybrid value carriers - where airlines move away from pure legacy full network service carriers and pure LCC models to hybrids of all types. An apple to apple comparison of say United Airlines revenue models looks remarkably similar to say Easyjet these days.
Now I am sure that some people may pick at my numbers but - the analysis is sound I believe.
Cheers
03 March 2010
Boomers Need Glasses and....
Interesting study out of eMarketer on Smartphone and Mobile Internet usage by Boomers.
Now as I am a (relatively young) boomer despite the pipe and the tweed jacket, I can attest to the real issue which is our fingers are not quite that adept at using the touch screen and we need glasses to read those damn small screens.
Frankly I think there is another influence at work. We are really tired of having to adopt new technology and also its shaky performance. And here hangs a tale that should get all tech bods sitting up and paying attention.
We are now so assailed by "new" functions and capabilities - we have adopted a culture where function exceeds form. We really do need a reset and get back some of the form that is more comfortable to us older types. Just because something is cool and new - doesn't mean we should take it.
I am by no means a Luddite but I do find it tiresome having to learn SO MANY NEW interfaces to applications and devices. I really wish that someone one give me tools that are LESS explicit and more automatic. AND were reliable and trustworthy.
In this research I read that I am not alone. Indeed because of what I do in my day job I have to learn new things every day. (I am told that should keep Alzheimers away!) So I use a lot of new devices and tools and learn new interfaces almost daily. And here is a secret - I have a good crew of people who can help me to learn them and remember the stupid ass codes that my old feeble mind forgets.
So here is an appeal to those hoping to get me excited about a new device. THINK first. Think of my usability issues. Try and find ways to simplify my life rather than adding complexity to it.
On behalf of the Woodstock generation - I thank you.
Peace Man..............
Now as I am a (relatively young) boomer despite the pipe and the tweed jacket, I can attest to the real issue which is our fingers are not quite that adept at using the touch screen and we need glasses to read those damn small screens.
Frankly I think there is another influence at work. We are really tired of having to adopt new technology and also its shaky performance. And here hangs a tale that should get all tech bods sitting up and paying attention.
We are now so assailed by "new" functions and capabilities - we have adopted a culture where function exceeds form. We really do need a reset and get back some of the form that is more comfortable to us older types. Just because something is cool and new - doesn't mean we should take it.
I am by no means a Luddite but I do find it tiresome having to learn SO MANY NEW interfaces to applications and devices. I really wish that someone one give me tools that are LESS explicit and more automatic. AND were reliable and trustworthy.
In this research I read that I am not alone. Indeed because of what I do in my day job I have to learn new things every day. (I am told that should keep Alzheimers away!) So I use a lot of new devices and tools and learn new interfaces almost daily. And here is a secret - I have a good crew of people who can help me to learn them and remember the stupid ass codes that my old feeble mind forgets.
So here is an appeal to those hoping to get me excited about a new device. THINK first. Think of my usability issues. Try and find ways to simplify my life rather than adding complexity to it.
On behalf of the Woodstock generation - I thank you.
Peace Man..............
The Long March Back to 3 Class Seating
Tim Hughes wrote an interesting piece not so long ago on the death and rebirth of first class.
It seems he is spot on. The latest carrier to offer premium economy (with a touch of leg room extra) is CO. Their announcement further aligns them with their new best friend UA.
It does seem to be that the first class is going to die a slow death. A relic of a bygone era. Rather like Concorde.
Still I can say I have flown a couple of times in a decent first class. Its a really great experience. Did I enjoy paying the 4X price for the short duration of the trip? No!
And neither does anyone else. (with few exceptions and you know who you are).
Cheers
It seems he is spot on. The latest carrier to offer premium economy (with a touch of leg room extra) is CO. Their announcement further aligns them with their new best friend UA.
It does seem to be that the first class is going to die a slow death. A relic of a bygone era. Rather like Concorde.
Still I can say I have flown a couple of times in a decent first class. Its a really great experience. Did I enjoy paying the 4X price for the short duration of the trip? No!
And neither does anyone else. (with few exceptions and you know who you are).
Cheers
01 March 2010
Is The Asia Crisis Over Yet?
Good news emanating from Asia this week.
Singapore is usually a pretty stable proxy for the whole region. It is typically imune from the fluctuations that can be dramatic in some of the other markets like Bali or Hong Kong.
After a dramatic drop off in visitors and time spent that began in the latter half of 2008 and reached its lowest point in the first quarter 2009, the market has slowly inch by inch crawled back. In January 2010 - the market occupancy rose above that of a year earlier. While not fully back to the same level of occupancy enjoyed before - the Singapore Government must be happy with the results. Correspondingly SQ must also be happy to see the back of 2009.
While yields are not fully restored yet - we are seeing rises there too.
This is good news all round
Cheers
Singapore is usually a pretty stable proxy for the whole region. It is typically imune from the fluctuations that can be dramatic in some of the other markets like Bali or Hong Kong.
After a dramatic drop off in visitors and time spent that began in the latter half of 2008 and reached its lowest point in the first quarter 2009, the market has slowly inch by inch crawled back. In January 2010 - the market occupancy rose above that of a year earlier. While not fully back to the same level of occupancy enjoyed before - the Singapore Government must be happy with the results. Correspondingly SQ must also be happy to see the back of 2009.
While yields are not fully restored yet - we are seeing rises there too.
This is good news all round
Cheers
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