A recent story featured in the Herald Sun talked about the desperation of some airlines in trying to win market share being based purely on free booze...
A recent story featured in the Herald Sun talked about the desperation of some airlines in trying to win market share being based purely on free booze…
The new entrant to the trans-pacific market between LAX and SYD has lifted the number of airlines competing on that route to four airlines. So with the increased competition price is certainly a factor that is going to benefit with my recent flight from Brisbane to LA costing $975 including taxes and charges. US analyst Rick Seaney “Fare Compare“, told the Herald Sun fares to Australia could drop to $320 each way excluding tax, but is the best way to make a profit on that low cost airfare to offer free booze?
The issue at stake is the more people that fly the better chance that the airline can make the route profitable and their competitors can make less, but the problem is that these can often lead to a race to the bottom. This is the point that no airline can make any money on the route and then competitors drop out leaving one or two airlines who can go back to charging what ever they want.
Other downsides of free booze is that it makes it harder for passengers to avoid prevent jet lag’s effects as alcohol’s effects are increased at altitude. This can also increase the number of complaints from other passengers, stress of staff and further increase the stress at customs. The concept of free booze = profits seems to be based around a Las Vegas business model where booze is priced below cost to get people in the door. Is a booze cruise the best way to promote trans-pacific routes?
Are Delta building a booze brand that will be forgotten in the hangover when the recession ends? After a recent trip to USA I would prefer that Delta charged for their booze like United Airways and V Australia and did not charge me $15 for my first checked bag and $25 for my second when flying internally within USA.
So how is this affecting their web marketing campaigns? What seems to add further fuel to the fire is that Delta is now running Google Adwords Campaigns promoting their daily flights from Sydney to Los Angeles based around the keyword “Fare Compare“, working to benefit directly from the Herald Sun article coverage.
Based on my recent trip to USA, I would have to say given the option of a slightly higher ticket price and having to pay for beyond my first free beer I would encourage travel with V Australia. V Australia have made their trans-pacific route with a focuse on making the flight about service and excellent in-flight entertainment.
Also in what could be a statement to regret Qantas exec VP to the Americas Wally Mariani vowed to fight hard in any price war.