High Airline Fees and Lacking Customer Service- What’s Going On? by Kane Minks

by Kane Minks

Airlines should be doing everything in their power to better serve their customers in these turbulent economic times. Many air carriers have not. Extra fees and charges are disliked by passengers, but are increasing as a way for traditional air carriers to counter low-cost airlines and rising costs.  Low-cost carriers are competing on cost leadership and traditional carriers are trying new ways to differentiate their services from their competitors to attract business.

Sky Jet Kane MinksLow-cost air carriers typically operate no-frills flights at a price point comfortable to the masses. To differentiate from low-cost air carriers, traditional carriers offer products and services not typically offered by discount carriers.  Increased leg-room, First and Business classes, premium in-flight entertainment, internet, first-rate food and beverage selections, clubs, and more can cost traditional carriers and their passengers more. Many of the added fees and upgrades are “options” passengers have to make their travel experience superior to flying with a low-cost airline.

This is not to say low-cost airlines do not have additional fees, and do not offer added products and services. Traditional carriers have to strategically do what low-cost carriers are not doing, which is usually a product and service that increases costs, but provides an overall flight experience unmatched, to some extent, by low-cost carriers.

According to the August 2012 U.S. Department of Transportation (DOT) Air Travel Consumer Report, overall passenger complaints have increased from 1,128 complaints in 2011 to 1,653 complaints in 2012. This is a considerable jump of nearly 47% in only one year. Specifically, customer service complaints alone doubled, from 142 in 2011 to 284 in 2012.  This should be a clear indication airlines may not be paying enough attention to passengers.

To break it down even further, low-cost and traditional carriers differ greatly in customer satisfaction.  The 2012 J.D. Power and Associates North America Airline Study results show low-cost carriers rate higher in customer satisfaction than traditional carriers. Traditional carriers averaged 647 on a 1,000 point scale versus an average low-cost carrier score of 754.  Low-cost carriers averaged 14% higher.

From these studies, traditional airlines are not just battling low-cost carrier prices, but also their customer satisfaction. Traditional carriers should, theoretically, excel in customer satisfaction. They supposedly offer some of the highest quality products and services as a competitive edge, yet they rank lower than discount airlines. Many low-cost carriers have excelled not only in customer service, but also in low prices- this has proven a winning low-cost combination for years.

When airlines should be vying for every competitive edge available, it seems some airlines may be overlooking good old-fashioned customer service and satisfaction. No matter how an airline operates, there is no reason customer service should be thrown over a cliff. It is an absolutely essential strategic component in any business today. Many businesses only have one chance per customer to do customer service right. Opportunity lost can be more costly than the price of a great customer experience. Traditional airlines have a real opportunity to improve for the benefit of their customers and their own bottom-lines.

Kane Minks

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Spirit Airlines hit with lawsuit over fees – Business – MiamiHerald.com by Kane Minks

English: Spirit Airlines N587NK (an A321-231) ... Kane Minks

Spirit Airlines hit with lawsuit over fees – Business – MiamiHerald.com.

Kane Minks

Interesting story. Spirit is an Ultra Low Cost Carrier that makes their profits from exorbitant fees. The only thing included in their basic ticket price is the seat and the ability to carry on one personal item (like a purse or backpack). Everything else incurs a fee. This lawsuit is in reference to a certain fee they have been charging their customers for years. Their passengers love to hate them for their fare structure, but in the end they always come back. They simply offer the cheapest fares to some of the most popular destinations in the U.S., Central America, and South America. A Spirit Airlines Case Study will follow shortly……

 

Kane Minks