Travel and Entitlement
I have been thinking about America Airlines new baggage fee structure that was announced recently. It has been all over the news. Most of the people I have heard talk about this is upset. How dare American Airlines try something like this? How can they charge customers for something that used to be free.
That is one of the catches. Checking baggage was not free before. The charge was included in the price of the ticket. People were paying for it if they used it or not. We are just not used to paying for it separately. It is like raising the cost for just the customer using the service.
In many ways this change in fee structure is a response to the internet. Right now it is really easy for everyone to see the price for every airline. Every airline has to compete on price. There is no space anymore to charge more than another airline. they only way to have another price is to change the bottom line price without changing the top line price. This is just want American Airlines is doing.
Many people who rail against this say it is a poor way to treat your customers. I know that this is called Gotcha Capitalism. People say if you leave the customers with a poor experence they will not come back. I have heard lots of people say that customer service is the new marketing and that you need customers on your side. In the internet age, the top line price is what gets people to buy your product.
My experence is that no one wants to pay for customer service. There are plenty of categories where people want to pay the cheapest price no matter what. They will complain if they do not get good customer service, but they are not willing to pay for it. The problem is that good customer service costs more money. It is not just a matter of people working harder. It is really hard to see customer support ratings on air fare search engines. If I am searching for just the lowest price it is hard to see what I am paying for.
The other interesting part of the news coverage I have seen about this is attitude of customers. The coverage has had a lot of "Traveler on the Street" reaction shots. People are acting like they are entitled to low air fares. They talk like any change in air fares something evil. They talk like the Airlines do not have the right to charge whatever they want. It is a strange idea to me. I think that airflight is a luxury and will be more so in the future.
I am surprised how low the price of airfares are. I would have expected them to explode. Fuel has gone through the roof. I am still finding flights from San Jose to Philadelphia in October that are less than $300. That is amazing to me.
That is one of the catches. Checking baggage was not free before. The charge was included in the price of the ticket. People were paying for it if they used it or not. We are just not used to paying for it separately. It is like raising the cost for just the customer using the service.
In many ways this change in fee structure is a response to the internet. Right now it is really easy for everyone to see the price for every airline. Every airline has to compete on price. There is no space anymore to charge more than another airline. they only way to have another price is to change the bottom line price without changing the top line price. This is just want American Airlines is doing.
Many people who rail against this say it is a poor way to treat your customers. I know that this is called Gotcha Capitalism. People say if you leave the customers with a poor experence they will not come back. I have heard lots of people say that customer service is the new marketing and that you need customers on your side. In the internet age, the top line price is what gets people to buy your product.
My experence is that no one wants to pay for customer service. There are plenty of categories where people want to pay the cheapest price no matter what. They will complain if they do not get good customer service, but they are not willing to pay for it. The problem is that good customer service costs more money. It is not just a matter of people working harder. It is really hard to see customer support ratings on air fare search engines. If I am searching for just the lowest price it is hard to see what I am paying for.
The other interesting part of the news coverage I have seen about this is attitude of customers. The coverage has had a lot of "Traveler on the Street" reaction shots. People are acting like they are entitled to low air fares. They talk like any change in air fares something evil. They talk like the Airlines do not have the right to charge whatever they want. It is a strange idea to me. I think that airflight is a luxury and will be more so in the future.
I am surprised how low the price of airfares are. I would have expected them to explode. Fuel has gone through the roof. I am still finding flights from San Jose to Philadelphia in October that are less than $300. That is amazing to me.
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