By Steve Endacott, chief executive, On Holiday Group
Tui’s recent move to harmonise its approach to flight pricing by making baggage an extra charge on its trade Atol to Atol flights shows how ingrained this particular “Bait and Hook” strategy has become.
Now every airline is playing the baggage game.
The moment I saw Flybe’s move in 2005 to start charging £2 per checked baggage, I just knew that this little game would catch on.
However, I did not imagine the lengths that commercially-focused airlines like Ryanair would take this to.
Looking at the Ryanair site, I can fly to Tenerife for a very reasonable £152 in August, but then I get hit with a £90 charge to check in a 20kg bag later in the booking process.
The average weight of a European is 70.8kg - so how many bags equal a person? The answer is 3.5.
If airlines simply charged by weight carried, the £90 bag charge equates to a seat charge of £316.
So the maths can simply not be justified, unless of course Ryanair are factoring in that they give a better customer service experience to the bags.
I admire many things about Ryanair’s commerciality and could just about live with the checked baggage charge, if it was not combined with a brutal approach to hand luggage.
I don’t want to be made to feel like a petty criminal or smuggler when boarding.
Do they really have to measure every bag with a cardboard slider, to see if it meets their ever-changing dimensions and make you stand to one side if they don’t?
The answer is clearly yes, when maximising short-term profits, but if it damages customer retention then in the longer term it has to be questioned.
Ironically, the very structure of the standard dynamic packaging site rewards Ryanair’s baggage pricing policy.
The CAA vs Travel Republic legal case enshrined the basket approach, where customers choose a flight based on price and flight times, before adding a hotel.
However, it’s only after these choices are made that customers are hit with highly varying baggage charges depending on the airline selected.
Hence, although the total price of a Ryanair Flight including baggage can be higher than that of a competitor, it is listed as cheaper and hence in effect the OTA’s are pushing customers to Ryanair.
Combine this with the fact that Ryanair is actually often the cheapest airline and you start to explain the dynamic packaging sectors' high level of Ryanair sales, even if Ryanair does hate us.
Baggage costs are so high, that I recently came close to investing in a new start-up company called “Fetch my Luggage”. It’s actually cheaper for this company to pick up luggage from customers homes and deliver it to their hotel rooms using DHL’s land based services.
I loved the idea of marketing the concept of “Speedy Travel” and cutting 3 hours off the average holiday journey time, since customers can whiz through both departure and arrival airports if they avoid baggage drop off and pick up.
However, a fatal flaw is that DHL does not allow flammable item such as deodorant and perfumes to be transported and how many of our lovely wives would agree to leave them behind.
So it works, but not for the mass market in my opinion. However, if you want to send your golf clubs, ski equipment or promotional gear ahead, check them out.
More radically, how long will it be before airlines start poaching each other’s customers’ luggage?
Flights with Easyjet, but drop your baggage at the Jet2 counter who will deliver it to your hotel? Wacky, but an interesting idea.
(The above article is reproduced from Steve Endacott's personal blog)
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