Et tu, JetBlue?

For several years now, JetBlue has had a simple advantage over airlines like Delta Air Lines, American Airlines, and United Airlines.

In fact among the biggest airlines, only Southwest shared it with them.

Because while three of the four biggest airlines rolled out bargain basement fare classes with intentionally stripped-down experiences in an effort to compete with low cost, high complaint carriers like Spirit and Frontier, JetBlue held fast.

There was no such thing as so-called Basic Economy on JetBlue (or Southwest for that matter).

No loss leader base fares, for which you literally only got a ticket.

No fares that didn't allow checked bags, or prevented you from choosing your seat in advance, and came with no guarantee you'd be able to sit next to family members or other traveling companions.

No fares that offered no chance to upgrade if such an opportunity became available, no way to make a change if you absolutely needed to.

But not anymore, apparently.

JetBlue's president and chief operating officer, Joanna Geraghty, told JetBlue employees that a JetBlue version of basic economy is on the way.

"At JetBlue, we never liked the 'no frills' approach," Geraghty said, according to Skift. But she added, "customer behavior suggests our success is at risk if we do not disrupt this market by lowering fares without sacrificing the experience."

Without sacrificing the experience. That's kind of the trick isn't it?

So far, it's been hard to imagine any airline pulling it off. How do you strip out important features that passengers naturally expect from an airline ticket without making it a worse experience?

"Customers who opt for this fare will agree to some limits, which might include things like boarding order, seating, and change/cancellation flexibility, but we will not make them feel like second-class citizens," she promised.

Which sounds nice. Nobody wants to feel like a second-class citizen.

But just to add another wrinkle: Other airlines admit that part of the reason basic economy works for them is precisely because it's such a terrible experience.

Meaning, passengers comparison shop, and are lured in by the low price--until they see just how little they're getting. And then, they're upsold at every stage of the purchasing process.

For example, American Airlines admits it's managed to upsell 60 percent of passengers who started out looking at basic economy, only to realize later in the process how little they get with the fare.

Actually, "admits" isn't the right word. More like "bragged," because it means much more money for the airline.

So maybe JetBlue has to do this. For what it's worth, their stock jumped right after Geraghty's announcement at the conference.

But there's a risk. Airlines like to think that passengers decide what flight to take based only on hard factors--meaning things like the specific features they get for their fare. But that's only part of the puzzle. Passengers also make choices based partly on how they feel about the airline.

I experienced this myself when I flew the same route, days apart on JetBlue and United Airlines (regular economy, not basic).

The seats and service were basically identical. But the intangibles? JetBlue won.

Can you maintain that kind of advantage if you start chasing the cheap dollar fares? Is it a slippery slope?

Hard to say, of course. But on JetBlue until now, we haven't had to guess. It looks like now we will.

Oh well. I guess there's always Southwest.
 

Published on: Sep 29, 2018
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