During the WIT 2008 Conference in Singapore last week - Azran Osman Rani who is CEO of Air Asia X the long haul version made a startling if somewhat revolutionary statement that really took me and gave me a wow moment.
Up till now I thought I was the strange person who seems to think that simplicity saves money for users and airlines – it seems that I am not alone. Air Asia has done a lot that’s right – so I think that they deserve some credit and definitely there are a number of items that we can take away from this.
For those of you who are Newsweek readers – the conventional wisdom column is always a good indicator of where to be. In this instance everyone should just take a moment and consider where common sense can be applied. An example – Unbundle pricing actually creates complexity. So let me just focus on that issue for now.
Low Cost Carriers have made a killing in the market by simply being better at making what works go well and eliminating the unnecessary elements of the product. For the network carriers unbundling actually doesn’t work so well. Why???
The first reason just needs common sense. The more complex the product the more elements. Therefore assuming that you can take a 25 feature product and market it the same way you do a 5 feature product is – well – stupid. But that is what the legacy carriers want us to believe. And this will be their downfall.
Bear with me – let me tell you a story of similar dimension.
When I worked at Microsoft – one of my long time friends came to visit from the UK. Choice in the Microsoft Cafeteria was always a big thing. You could choose from Asian to Salads to sandwiches to whatever was on offer that day. So my friend – chose Sandwich. Off he went. He was gone rather a long time. He came back and when he returned he was shaking his head. He blurted out – “Do you know how many questions I was asked? 16 he continued. I was astounded. All I wanted was a sandwich. It took them longer and frankly I was not sure I really got what I wanted.
So let that be a lesson. Does experience really beat common sense as the legacy carriers would have us believe? Perhaps unbundling a complex (legacy) product is not necessarily a good thing. It really does defy common sense. So what do you think?
Cheers
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