I know it’s hard to believe, especially for some of the youngsters who might be reading this, but there was a time when air travel was so much nicer than it is today. And no, I’m not talking about back in the 40’s! If you were waiting for a flight to depart and there was a problem, the airline might move you to a competing company to make sure you got to your destination. They might even do that if it was your fault, like getting to the airport late and missing your flight. Not that I have any firsthand knowledge of such a thing, I’ve just heard stories. You might have to pay the difference in airfare, but I don’t remember change fees and all the hoops we have to jump through today to change a flight. Back then, helping you get to your destination was more important and created better loyalty than the immediate loss of revenue.
Then, deregulation hit and yes, prices dropped and more people could fly. I’m not sure that made the experience better, but it did open travel up to a wider audience. But, that deregulation also came at a price, and not just monetarily. Where previously, almost all airlines realized that they needed to compete and cooperate, now they just competed. And with fares dropping, they started to add additional fees to everything they did. The said it was better for us, they really started to make a lot more money on all of these charges. In 2018 alone, airlines made a collective $5 billion in baggage fees alone. From a piece in the news today in the Washington Post:
Consumer groups have long pushed for airlines to do away with change fees, arguing they can be unreasonable, sometimes costing almost half the price of the original ticket. But airlines have steadfastly resisted because such fees have become a lucrative revenue stream. According to the Bureau of Transportation Statistics, U.S. carriers made $2.8 billion from reservation change fees in 2019, roughly 1.4 percent of their total operating revenue. Airlines made even more on baggage fees, roughly $5.8 billion, about 2.9 percent of their total operating revenue.
Change fees have become particularly onerous these days. I’ve sometimes had to pay more than the cost of the ticket to make a change. I think United had a change fee of $200, it was absolutely crazy.
So now that the airline industry has been hit hard by Covid, they’re starting to make some changes. Effectively immediately, United will drop change fees on all of its domestic flights.
“Change is inevitable these days — but it’s how we respond to it that matters most,” United chief executive Scott Kirby said. “When we hear from customers about where we can improve, getting rid of fees is often the top request. “Following previous tough times, airlines made difficult decisions to survive, sometimes at the expense of customer service (Emphasis mine),” Kirby said. “United Airlines won’t be following that same playbook as we come out of this crisis. Instead, we’re taking a completely different approach — and looking at new ways to serve our customers better.”
The truth is, businesses have long been screwing over customers in their rush to generate more revenue. While all airlines have had their issues, United had some doozy’s! How many of you remember United Breaks Guitars? This was a pretty big deal back in 2009 and frankly, it didn’t seem to really change much. They had a very clear philosophy – “We don’t really care if you fly with us or not.” BTW, the video below has a solid 20,000,000 views today.
And no matter how many times airlines ran commercials about how important you, the customer, were to them, but at the end of the day, we knew the didn’t really care. As long as they got money from us, they would tolerate our public griping. There were certainly times that people got individual help (over the years, I certainly did), for the most part, they never acted liked they cared one way to the other.
Now they need us. They asked for billions in taxpayer support money, which they got, but travel hasn’t picked up at all. Now it’s important to put customers first. I appreciate that they’re doing this, but after years of putting money first, they’re maybe realizing that with our customers, they don’t actually have a business.
There are examples of companies that have put customers first, but they’re really few and far between. Those companies have built bank with their customers so when something does go wrong, they have something to withdraw from that bank. far too many companies don’t have enough money in their customer accounts for times like this. They have been drawing down on accounts without putting anything back for far too long.
How is your customer balance sheet? Have you been taking with out giving? Would your customers agree with your assessment? You can’t just show up in the bad times and ask for help.
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