British Airways is having quite a large identity crisis. Part of that is being spurred on by having a CEO, Alex Cruz, who used to run a low cost airline, which was good at slashing every benefit except the aircraft tires. His new post is an airline which offers £120 a bottle champagne in first class, full service lounges and amenities, yet at the same time, at his helm, a dwindling short haul economy experience, being stripped of everything that’s not bolted to the aircraft. Seat cushions could be next…
What The **** Is Happening?
British Airways today announced “exciting changes from listening to it’s customers”, where the airline said that people wanted better food options on domestic and European flights. Sure, that sounds okay. The only problem is that the old “not so premium” options were free, and included coffee, tea, water, and even booze. A pretty civilized experience. Perhaps a reason to pay an extra $20 per ticket over discounters, who ended up “getting you” with fees and extras anyway. Now, effective January 2017, everything including tea and water, and yes, of course your meals too will be for purchase, to deliver this “premium” (bull****), experience. Read the press release yourself… Will prices go down? So far no.
Why Not Just Up Sell Passengers?
The step in the logic chain that constantly seems to be missing, is that subtraction is not the only form of creating revenue. Why not up sell us? Sure, for most, some Gordon’s gin will be perfect, but if you have the likes of a Bombay Sapphire or Hendricks for purchase, that’s an up sell. Most are still happy with their original offering, some pay up to get a “premium” offering. The same goes for food. Sure, a vaguely chicken looking dish will do for most, but why not offer a paid “premium” option, perhaps a grilled chicken caesar salad, or a sushi box. People who expected the free food can get the free food, people who want healthier or more premium options can pay more. Everyone wins.
Why Is This Happening?
Ryanair, EasyJet, the list goes on. These airlines are successful, they make a lot of money, and somehow, they’re doing it with record low fares. Alex Cruz made his fame and fortune doing exactly this. Rather than offer similarly low fares and look to find revenue from other means, like up sells or partnerships, British Airways is playing the cut and paste game of slashing all benefits, unbundling everything, literally down to the f***king coffee. Alex Cruz is emulating himself. Hence the very strange two airline identity crisis going on. Airline one caters to A listers, titans of industry and high flyers, while providing a generally full service experience for all passengers. Airline two wants to take the napkins away, a move which well could happen since not even the water is free.
Is there Any Other Bad News?
I’m glad you asked, because yes, there is. British Airways and Qatar Airways have announced a joint venture. While that sounds fine and dandy, with schedules being coordinated and benefits between the two airlines being enhanced, it means that British Airways will no longer have to react and fight off the low fares which Qatar were putting into the European market in all cabins. When you control such a large market share, you can join together to agree not to sink prices below a certain level. A pessimist could say that this may trigger the end of the lowest business class fares we’ve been seeing throughout Europe. A sad day in British Airways history…