The Weekly Eye October 31 – November 6
Ryanair’s eviction, Stormy strategies, Dispute settled, Great campaigns and Safety with a difference and more…our pick of the week’s news.
Social media may be a great way to provide your customers with excellent customer service (admittedly not something Irish low-cost carrier Ryanair is very well known for). It can also wreak cause havoc with your reputation. A video posted online this week showing a woman being escorted off a Ryanair aircraft in Spain, for carrying on two items that would not fit in her hand luggage, unsurprisingly went viral. People used Twitter to call on consumers to boycott the airline. According to Spanish newspapers, staff at the Irish low-cost carrier, called on local police to remove the passenger from its aircraft shortly before take-off. Footage is of the woman pleading with an officer while other passengers offer to put the items in their own cases followed by shouts of ‘shameful’ in Spanish as the woman is removed from the aircraft. A spokesman for Ryanair claimed the woman had become disruptive and had ‘pushed past’ staff at the gate without showing any identification. It also said she had broken airline regulations.
Putting the customer first
Also on the subject of customer service, in San Francisco there was a bit of a case of the caring and the crafty. This week Airbnb, the online home rental service, decided to waive fees for over 20,000 listings in areas affected by Superstorm Sandy. The San-Francisco-based startup said it would forgo fees for both hosts and travellers booking from Oct. 31 to Nov 7 in certain affected places. In an email to users it called on hosts to consider lowering their prices. Another San Francisco start-up, car-service firm, Uber, took another approach. In a blog post it said: "Raising the price is the only sustainable way to maximise the number of rides and minimise the number of people stranded”. It had a bit of a shock by te huge outcry on Twitter which led to Uber beating a retreat. It said it would pay drivers more rather than raise prices. Bu this did not last for long and on Thursday it said it would return to regular surge pricing, used during high-demand times such as New Year's Eve, to avoid “breaking the bank”. It doesn’t take much to work out which company will be remembered for putting its customers first.
The dispute between American Airlines and ticket distributor Sabre Holdings over alleged anti-competitive business practices has been settled. American had claimed that global distribution systems which provide fare information to travel agents were protecting their own mutual interests and were discriminating against airlines which tried alternative distribution practices. American will receive an undisclosed payment from Sabre and the two companies have renewed their distribution agreement. As a result of the settlement, Sabre is no longer a defendant in American's continuing federal suit against Orbitz Worldwide and Travelport.
Bottom line boost
Airlines have become depending on ancillary revenues from bag charges, admin fees, car-hire sales and the like. This year airlines made £22bn, a figure that is expected to rise again next year as airlines consider introducing higher fees for both hold and carry on luggage. According to a study by Amadeus and aviation consultancy IdeaWorksCompany these have jumped 11% since last year and account for nearly 40% than carriers received in 2010. The so-called ‘ancillary revenue champs’ which include AirAsia, easyJet, Allegiant Air and Spirit Airlines increased ancillary revenues by 30.5% during the last year. But traditional airlines like BA and Air Canada also saw ancillary revenues by 17%.
Third runway gets the vote
This week the World Travel Market is underway in London. Here the plan to expand Heathrow has won more support than the construction of a new airport on the Thames Estuary. Additional airport capacity is a big issue in the UK. There is not much in it between holidaymakers polled; 28% say they would prefer a bigger Heathrow while 25% support an Estuary scheme. However the tourism industry comes out strongly in favour of a third runway; 34% support it versus 20% supporting an Estuary airport.
Ensuring ROI is an ongoing theme for any investment made by the travel industry. But it seems Britains ‘Great’ campaign may just deliver the goods. Speaking at the World Travel Market in London, Culture Secretary Maria Miller said the campaign could contribute an additional £2 billion to the economy, while creating 50,000 new job opportunities. Early forecasts are that the financial returns on the investment are really encouraging, she said. Launched before the Olympics in 2011 and targeting nine countries, with adverts appearing in 14 key cities the campaign will run until 2015 with the aim of attracting an extra four million visitors to Britain in that time. The government has spent half a million pounds has been committed to developing the brand which has also been used by VisitBritain, UK Trade and Investment and the British Council.
It isn’t the first time Air New Zealand has been innovative with a safety video, used also for marketing purposes. It previously featured cabin staff wearing nothing but body paint and New Zealand's All Blacks rugby union team. Now it is a Hobbit-themed video which has been released on the back of Peter Jackson's upcoming movie The Hobbit: An Unexpected Journey. Jackson makes an appearance in the four-and-a-half minute clip before disappearing; it also includes appearances by Mike and Royd Tolkien, JRR Tolkien’s great-grandsons. Air New Zealand marketing manager Mike Tod said the video was part of a major global promotion linked to the movie (read more about movie themed tourism on EyeforTravel.com) and says the airline will invest several million dollars in Australia, Asia, the US and Europe on uniquely Air New Zealand marketing efforts related to 'The Hobbit' movies to attract more tourists to New Zealand.