Cheap flights or decent service?

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Author: Rogers, Daniel

Low-cost airlines have had their honeymoon and people are beginning to notice the service. How will budget carriers respond?

In these difficult economic times, the low-cost airline sector is a breath of fresh air.

While most sectors are talking of retrenchment, the budget carriers talk only of expansion.

The two biggest players easyJet and Ryanair are finalising consignments of around 100 new aircraft each and passenger traffic looks like growing at more than 30% per year for the next two years.

But while these two brands continue to add a welcome splash of good news in the city pages of newspapers, they are increasingly attacked in the travel and consumer sections of the same journals.

There have been question marks raised over the customer service and even the safety of the budget airline model.

So are we seeing a backlash against what are often perceived as ‘the people's brands’ of the transport sector?

It began with a trickle of bad news in the spring with a very public spat between easyJet founder Stelios Haji-Iaonnou and Ryanair boss Michael O'Leary. O'Leary believed Stelios had implied that EasyJet's younger fleet was safer than Ryanair's.

Although the issue died down and Ryanair assured consumers that safety was an absolute priority, a seed of doubt was left in the public psyche.

A torrent of negative coverage followed in July. The Observer devoted its entire travel supplement to giving ‘The lowdown on the “low cost” airlines’. “No-frills flights may not seem such a good deal when they leave you stranded overseas or when a beer on board costs £7.50,” it wrote.

This was followed by the high-profile story of passengers on an easyJet flight who held a sit-in when asked to leave the plane for a last-minute schedule change, fuelling stories of over-stretched operations. And, last week, Ryanair was named and shamed as giving passengers the worst customer service in a report from the Air Transport User Council.

Perhaps tellingly, the key spokespeople for both airlines were unavailable for comment for this article.

But Tim Jeans, former sales and marketing director of Ryanair and now managing director of MyTravel Lite, does believe that the low-cost brands have reached the end of their ‘honeymoon period’.

“This summer is proving that people are becoming more critical,” says Jeans. “When we started bringing low-airline fares to people, we were greeted as heroes. Now people are beginning to expect them.”

“Low-cost carriers have set themselves up as champions on price but not service. This is fine but when things go wrong there isn't the breadth of recovery that we can offer,” says Jane O'Brien, British Airways' head of marketing in the UK. And she adds: “ecause we have now lowered our prices, objective comparisons of service are now being made.”

It is also a problem of scale. Ryanair carried a record 1.45 million passengers in July, up 450,000 on a year ago, and easyJet/Go carried 1.65 million, 650,000 more than last year.

Not only is there a problem of maintaining standards at this rate of growth, but any shortcomings will receive more exposure. “With the jump in size of the carriers, service issues affect thousands rather than hundreds of passengers,” Jeans points out.

The negative coverage is a problem these brands must now address, so how can we expect them to do so?

“EasyJet will go on a charm offensive,” predicts a senior executive in a rival carrier. “It is expert in PR, so it will make improvements to the operations in question and make damn sure it tells people about them.”

As for Ryanair, expect the exact opposite. “It is a commodity business and people respond best to price,” says Jeans, from experience. “Expect Ryanair to hack away at costs and offer people fares at even cheaper prices.”

GRAPH: PERCEPTIONS OF RYANAIR

GRAPH: PERCEPTIONS OF EASYJET

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By Daniel Rogers