Mystery buyer
In each issue, one of our travel buyer readers tackles a subject close to their heart, sparking lively debate on our online forum. Join in at
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RYANAIR & BUSINESS TRAVEL
IN THIS ISSUE, OUR MYSTERY BUYER WRITES AN OPEN LETTER TO RYANAIR BOSS MICHAEL O'LEARY...
Dear Mr O’Leary,
I genuinely congratulate you on running a consistently profitable and successful airline – a feat which few others in the western world seem capable of emulating. We love your young fleet, point-to-point routes, competitive fares and-back to- basics thinking – long overdue in an industry comfortable with cartels and bilateral agreements. You may fly from secondary airports such as Stansted, Luton and Torp, but guess what? We have sites in Cambridge, Stevenage and Welwyn, and plenty of our travellers happen to live close to the airports that you are serving, even if we struggle to spell their names correctly. You might surcharge anything that you can think of, but United Airlines will also be charging me $6 for a can of beer these days. To be effective, we travel buyers have to commoditise the airline product.
Ryanair has shown us what the ‘unbundled’ product really looks like – and, most importantly, taught us what we should be paying for it. So, with annual profits of more than €500 million and a fleet of 300 aircraft (rather more than BA!), where does Ryanair go next ? Well, from where I sit, it seems that Ryanair’s traffic is essentially leisure and visiting friends and relatives. That’s a pity, because our business travellers would like to jump on your aircraft whenever it makes sense for them. Unfortunately, Ryanair makes it incredibly difficult for a business traveller to buy a Ryanair ticket. You’ll appreciate that corporations, to function efficiently, have to have standard processes and policies – just as Ryanair has found it necessary to standardise with an all-B737-800 fleet. In our case this means channelling all our travel through a TMC, booking through a self-booking tool, taking our inventory from a global distribution system, paying with a piece of corporate plastic and tracking everything through a travel information system. But Ryanair won’t have anything to do with any of this – and actively frustrates efforts by any intermediary to distribute your services to their business customers. We know your attitude is “take it or leave it”, and I guess you will equally understand that corporations aren’t going to change their global practices for a single carrier (however quirky), since we were taught at business school that it’s the supplier who should be responsive and flexible rather than the customer. But, if one of your 2013 New Year resolutions is to grab a slice of the business
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travel market, why not think again? You never know – we corporations might even be prepared to allow Ryanair to add a €20 premium to the base fare when it’s distributed through a GDS and you accept our Amex cards.
Yours hopefully,
I don’t think you’ll have much luck. Ryanair has been very successful sticking with its low- cost model, and any tinkering with it might well drive revenue but would also cause its costs to rise. Easyjet, meanwhile, has done all the things you’re asking for – do you use them?
I’m not sure about the supplier having to be responsive to the customer – sometimes they don’t. O’Leary took his inspiration from Southwest, after all, and the Southwest CEO, Herb Kelleher is quoted on that subject. When asked if customers are always right, Herb answered: “No, they are not! And I think that’s one of the biggest betrayals of employees a boss can possibly commit. The customer is sometimes wrong. We don’t carry those sorts of customers. We write to them and say: ‘Fly somebody else...’” Maybe O’Leary is doing that with corporates...
Ryanair is pretty much alone in Europe as a low-cost airline which sticks to its original business model. O’Leary is so vehemently anti-trade that it’s hard to see him changing course – any agent who has the cheek to screen-scrape Ryanair’s fares will soon find themselves in court. He has always refused to budge an inch on this subject and he is famed for his contempt of pretty much the entire travel trade.
Including Ryanair in your company policy might encourage more virtual meetings!
...AND THE FORUM COMMENTS
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MARCH/APRIL 2013
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