It’s happened to all of us. You arrive at the airport after having spent hundreds or even thousands of dollars on an airline ticket only to have them demand $25, $35 or even $50 more just to store you bags on board. Then they ask you if you want to upgrade your seat location or boarding priority for another $25 to $40. Once you get on board, they want $6 for a drink, $10 for a snack and $5 for headphones. And of course, all of those charges are repeated for your return flight. There is talk now that some airlines may even start charging you just to put your carry-on bag in the overhead compartment.
Suddenly your ‘bargain price’ $359 ticket (which includes one stop that is way out of your way and takes two hours longer than the higher priced non-stop) just cost you $459—or $559 including the return flight extra charges. Worse yet, after shelling out all of that additional cash, how many times has your flight been late or cancelled? Or the delayed flight caused you to miss your connection? Or they lost your luggage? These are not what anyone would call superior customer experiences.
Let’s contrast this airline example with what retailers provide for a pleasing customer experience. It starts with competitive pricing, of course, just like the airlines. But let’s imagine you bought an item online and want to pick it up at your local store on your way home from work. No problem—it will be ready when you arrive, and there is no charge for this service. Or you decide you would like the item delivered to your home. Usually that’s free too if you are a member of their loyalty program such as Amazon Prime, or if your order is over a certain dollar amount, or for special promotions and holidays.
Or maybe the item is a gift and you want it giftwrapped and sent to a friend or loved one’s home within the next day or two. That’s often free too under a loyalty program, or at most, there is a modest giftwrap charge. And if the gift doesn’t fit, they can return or exchange it for free as well.
There are plenty of other examples of how retailers are doing everything they can to provide the best possible omni-channel shopping experience for their customers. It’s not just about offering free services. Retailers are redesigning store layouts, incorporating new customer experiences such as restaurants, entertainment, cooking demonstrations, fashion shows and celebrity events, and are training and equipping store associates to provide these new experiences, pick and ship orders, and handle returns from any channel. The airline industry, in contrast, seems solely focused on the bottom line.
Of course, the airlines will counter that the Great Recession and the huge surge in fuel costs resulted in billions of losses that has forced their bottom line focus. But the recession is over, fuel costs are back down, yet they are still making billions off of these extra charges with no signs of any changes. Retailers were hit hard by the recession, too, and they didn’t respond by nickel and diming customers to abstraction, they added more services and bigger promotions with a clearer focus on what the customer really wants.
The airlines may counter that what customers want is low fares and that they are struggling to compete with low-fare airlines. I get that. But I also know as soon as one airline lowers or raises fares, or adds extra charges like baggage fees, all the others quickly follow suit.
What if one airline was brave enough to actually raise fares, but truly focus on what the customer wants and cut out all the extra fees? It wouldn’t be easy at first and there would be losses for a while. The public would have to be educated on value and corporate travel agents would have to start looking at total cost rather than just ticket pricing. Perhaps I am too optimistic and the airline industry has travelled too far down the fees road to alter course now, but focusing on the customer is working well for leading retailers and I think the airlines can learn a lot from that.