It seems more details have emerged about « Delta’s new pricing strategy » this weekend.
‘Under Delta’s new structure, prices for last-minute walk-up fares have been cut by as much as 50 percent, the long-unpopular Saturday night stayover requirement for lower-priced fares has been eliminated, the fee for changing nonrefundable tickets has been dropped from $100 to $50, and the airline’s menu of fares has been simplified: Now there are eight prices for each flight; before, there were dozens. These latest price cuts — for flights within the 48 contiguous states — will be more of a boon to business travelers than to vacationers. Most carriers already are offering deep discounts to their leisure customers.
So how does a “legacy carrier” with a history of fiscal mismanagement and clueless resistance to change plan to make more money by cutting it’s revenue?’
— Washington Post
Good question. Apparently, by turning airliners in flying Costco warehouses. Instead of toilet paper by the caseload, they’re going to give the flying public … well, I’m not sure what, but it’’s probably the finger or something.
‘It was only last month that Delta’’s Grinstein stood before a group of airline professionals in New York and predicted imminent change in the financially troubled industry. The reason the major airlines have been losing market share to low-cost competitors such as Southwest, he told his audience at the elite, private-membership Wings Club, is because travelers no longer think they’re getting a good deal from the big carriers. “I recently came across the mission statement for Costco, the membership warehouse company,” Grinstein said, according to a transcript of his prepared remarks. “Their goal is to ‘’continually provide our members quality goods and services at the lowest possible prices.” The failure of major airlines to meet that standard “caused us to lose the trust of our customers,” Grinstein continued. “Passengers no longer believed they were receiving the highest quality at the lowest possible price. And they were right. “As a result, customers shifted their trust and affiliation to carriers like Southwest and JetBlue. Southwest succeeded so well that today customers flock to the airline’s Web site, even when Southwest’s prices are higher than other carriers. They simply trust Southwest to be the best value around.”
There are some grains of truth here and I’ll give good ol’ Grinstein credit for pointing them out. First, the product of the legacy carriers is complete shite, to borrow a word. We’‘ve gone from the days of Braniff’s Flying Colors and the glamour of the World’s Most Experienced Airline to crappy, dirty, jam-packed ‘planes full of dirty, rude, ignorant hillbillies. Yet, we’ve left the pricing structure intact.
Second, that second-to-last sentence is telling: Customers trust Southwest (and Wal-Mart) to be the cheapest and best around so much that, even when WN and W-M are not, those customers still spend their time and money with them because of the perception that they’re the best value around.
Kind of like the same people keep voting against their own economic and social self-interest because the Fascist Party is now perceived as being the moral values champions who are on the little peoples’ side.
Delta and the other legacies have a long, long, long way to go to overcome that perception. Delta may pull it off. USAirways, if their Christmas debacles are any indication, probably cannot. Too large and mired in bureaucratic inertia, most legacies will not survive. The Empire’’s current trajectory appears to be giving us a culture where one shops at Wal-Mart, flies Southwest, votes Fascist, etc.
If this is where that Bridge to the 21st Century has delivered us, I’‘m headed back to the (ironically) saner 20th.