How To Tick Off Your Best Customers

[Mike Scott]

Source: Washington Business Journal
Author: Ian Altman

Have we really gotten to the point that not charging a passenger for a glass of water or their luggage is a differentiator? I am sure that a team of accountants advised the airline industry that the best way to create more revenue is to nickel-and-dime their customers until they scream. But how does that impact loyalty?

On a recent flight from Chicago on United Airlines, there was an article from United CEO Jeff Smisek in their in-flight magazine (you know, the thing you read when you can’t use your electronic devices). While you might expect to read an article from the CEO about customer service enhancements, instead he chose to write about their new Boing787 Dreamliners. Smisek shares many details like a proud parent would describe their child.

He points out the things that he must feel would matter most to his customers: Bigger windows, improved lighting, larger overhead bins, and enhanced ventilation systems.
He focused on what?

If I asked you to tell me the five most important factors for your decision to pick one airline over another, what would they be: a waiver of luggage fees, superior in-flight service and amenities, recognition of your loyalty to the airline, or maybe even safety and on-time record? Ultimately, most of us want to be treated with courtesy like a fellow human being and valued client. Instead, Smisek addresses his list of features on a plane. It’s like listing your capabilities and showing off your new office furniture instead of focusing on your client’s needs.
What was Smisek thinking?

Do you think the window size is a big differentiator for most passengers? Do you find yourself asking about lighting before selecting the carrier? I guess the overhead bins size could be valuable, since they have added luggage fees.

Of the twenty-nine Dreamliners delivered, United has one of them. It would be like an IT consulting company saying they were better because they now offer the latest software from IBM or Microsoft – just like the competition.
Don’t sell your best-customer perks

To be fair, I was a long-time, loyal United customer. In fact, I had reached the pinnacle of their program, Global Services — that mystery level where they rarely say no to you. I was a huge United fan. I have flown over 750,000 miles with them. I really wanted to love United, but they didn’t reciprocate.

Instead of nurturing their best customers, United has opted to offer the same perks for sale – thereby cheapening the value of those perks. There are now websites and even a Facebook fan page for Outraged United Elite members.
What can you learn from this for your business?

1. Avoid Access Displacement Disorder: It is easy for us to mistakenly think that the axis of the Earth has shifted and enters through our head and out our rear and the world revolves around us. However, the things that matter most to us, may not matter the most to our customers. Speak to your customer’s interests, not your own;

2. Ask questions and listen: Southwest and JetBlue are both airlines that have been known for low fares, but are delivering an exceptional customer experience. Customers wanted entertainment, a more relaxed feel, and the elimination of crazy fees. JetBlue offers DirecTV in flight, and they each still offer a snack on just about every flight along with your first checked bag at no fee.

3. Deliver value, and profit will follow: When airlines introduced new fees for baggage and drinks, we all watched in shock. Today, Southwest and JetBlue are able to offer additional value by not charging for those items.

I often see professional services firms turning their administrative services into a profit center. While your clients may not expect you to pay for their copies, they probably don’t feel good about you making a profit from it. Ironically, if you nominally raised your rates and didn’t charge for copies, you might make more money and build some goodwill. It might even set you apart from the competition. I recall being invoiced from a law firm for the time it took for them to prepare our invoice each month.

When we deliver value and anticipate our clients’ needs, we build goodwill. When we recognize and appreciate our best customers, we build goodwill. When it appears that our top priority is how to get that last dollar from their hands, our clients might go along when they need us, but they will give serious consideration to any alternative that might compete for their business.

Look at your business and see where the "luggage fees" and "missing snacks" are for your customers. Get rid of some of those and you just might build a loyal following.

PS I so liked this article....Confirms what we all know as employees...that our management simply doesn't get it. What a travesty for the words largest airline.

MS

[Michael Cleary]

Sad sign of the times. Management these days are only interested in the size of the Bonus they get at the end of the year. They wouldn't know what service is.

[Ash W]

Are they that bad? Great, I am flying United for the first time on Friday! Its also a bugger that on my return I am flying IAH-LAX a week or so too early to try the 787.

[Justin L]

No, United are not that bad. I have never had an issue with them domestically or internationally.

And what's wrong with the United CEO writing his monthly piece on the 787? I'm sure Qantas an other airlines had similar articles when they introduced their first A380s.

While the author's concern may be customer service, there are people and business travelers who choose a certain flight based on aircraft type.

[Rowan McKeever]

Originally Posted by Justin L

And what's wrong with the United CEO writing his monthly piece on the 787? I'm sure Qantas an other airlines had similar articles when they introduced their first A380s.

While the author's concern may be customer service, there are people and business travelers who choose a certain flight based on aircraft type.

Absolutely nothing wrong with it as far as I'm concerned! Smisek's job is to sell a product to his customers... a B787 is a product, one with a significant cost to the airline, and by all accounts one with a significant benefit for the passenger. It's his job to make potential passengers understand what those benefits are and, therefore, get bums on seats.

What happens once the passengers are on the plane is a whole different kettle of fish.

[Ash W]

I think the authors point was that when two airlines have the same aircraft that what makes a difference is the soft service (think that's the right term). Ie everything but the hardware. And that is where the author beleives United should be concetrating rather than upselling features of the 787 that are not 'unique' to United.

[Justin L]

Fair point Ash. But from a domestic product standpoint in the US the 787 is unique to United at this point in time. And all airlines like to up-sell their 'modern fleets'. Also, apart from Star Alliance partner ANA I don't believe there are any other airlines flying the 787 to the US.

[James S.]

Originally Posted by Justin L

Fair point Ash. But from a domestic product standpoint in the US the 787 is unique to United at this point in time. And all airlines like to up-sell their 'modern fleets'. Also, apart from Star Alliance partner ANA I don't believe there are any other airlines flying the 787 to the US.

You forgot JAL.

[Mike Scott]

Keeping in mind that many on this board would much prefer the discussion/article be related to our new 787 (understood and granted) The bigger picture (from my personal viewpoint as an employee) is that the company has serious customer service related issues (which cost us significant revenue) and maintenance related issues (which cost us both revenue and schedule delays) which our illustrious CEO should be discussing/and how its going to be fixed in a magazine that is read directly by our flying customers. Yes its good to highlight all the great features of this new aircraft but how about we concentrate on getting all the post merger issues fixed first including our merged contracts.

Enjoy the new airplane...at least maintenance delays should be minimal/non existent at best.

MS