12 ms·

How do you expect consumers to view flying as anything but a commodity when I can pay 2x more then the customer sitting next to me? The airlines, with their by

How do you expect consumers to view flying as anything but a commodity when I can pay 2x more then the customer sitting next to me? The airlines, with their byzantine and constantly shifting prices, have totally ruined any correlation between 'price' and 'value'. It's completely arbitrary from the point of view of the consumer. I might end up an old plane with a horrible seating configuration, or a brand new plane with plenty of legroom and in-flight entertainment. All on the same airline, between the same cities. My experience has no correlation with the price I'm paying, unless I decide to pony up for business class. Even then, among business class, there's a big difference among airlines. The industry is so concerned with extracting the maximum amount per customer, they forget that it's more important to grow their customer base. That said, I've been flying almost exclusively Virgin (America/Atlantic) for the last year or two, and they are definitely a cut above. Virgin America has an entire fleet of brand new planes, comfortable seats, personal in-flight entertainment and wifi, and great staff. Virgin Atlantic has Premium Economy, which is so worth the extra few hundred dollars (as opposed to the 2x for business) for flights to Europe. Here, at least, I can justify the price difference, at least vis-a-vis competing airlines.

asmithmd1 16y ago
From the article: "So why is air travel, among the most differentiated experiences we have in the normal course of life, purchased by so many people as a commodity?" So not true. A restaurant is a much more differentiated experience and also a "perishable" one that people are willing to pay a premium for. JetBlue has TV's and SouthWest has free luggage but you can't pick your seat -- what other differences are there between airlines? I you think you hit the nail on the head with the airlines destruction of any price/value correlation. The table next to me might be getting a free appetizer or desert but they are not going to be paying 1/5 or 5x as much as I am.
- city41 16y ago
  > So not true. A restaurant is a much more differentiated experience and also a "perishable" one that people are willing to pay a premium for. Yes but a meal at a restaurant is the primary experience. People are deliberately seeking a good one as eating a fine meal is their intent. Flying an airplane is just a means to an end. An annoyance really. And in that mind set most people aren't going to care, myself included.
  - hugh3 16y ago
    Also, as soon as you start treating air travel as an experience to be enjoyed rather than tolerated, it quickly becomes apparent that it's really bad value compared to ground-based enjoyable experiences. For instance, I can fly from LAX to Sydney for, say, one thousand dollars in economy, or (goes to check fares) sixteen thousand dollars in First Class. That's a thirteen-hour flight, so you're paying more than a thousand dollars an hour for whatever extra pleasure you get by sitting in a nicer seat, eating a nicer meal, and being brought drinks by a prettier stewardess. Alternatively, I could eat at the best restaurant in town for $200 and then go and sleep in a fabulous hotel room for $500. That's a far better pleasure-quantum-per-dollar ratio than anything you can get in the air.
    - patio11 16y ago
      Indeed, for the price of a trans-Pacific first class ticket, you could stay in a hotel room designed to look like a first class cabin, hire a comely young lady to bring you (and only you) all the cranberry juice you could drink in 16 hours, eat the best meal in town, get to pick your own movie, and have your doctor prescribe you something so that you spend the next actual plane flight unconscious.
      - hugh3 16y ago
        Of all the fantasies I've ever heard which involve a hotel room, a comely young lady, fifteen thousand dollars and all-you-can-drink cranberry juice, that's the dullest, I'm sorry.
    - philwelch 16y ago
      That's why I think there should be premium airlines which perform aerobatic maneuvers occasionally throughout the flight, because that would be entertaining. Bigger seats and better food? These people just don't know how to create an enjoyable experience inside an airplane.
    - gamble 16y ago
      Hardly anyone pays out-of-pocket for first-class tickets. I suspect 90% of premium cabin passengers are flying on their company's dime, have been upgraded, are using awards, or are non-revenue passengers. The few who pay their own way skew toward the investment banker side of things.
amohr 16y ago
+1 for Virgin. I've never flown (I live in Chicago and they don't hit O'Hare) but I've heard almost exclusively good things. They are doing exactly what needs to be done in these giant, somewhat stagnant industries - introducing a brand with a customer-centric model, offering a "premium" service. Of course, in the world of air travel, it takes surprisingly little to distinguish yourself from the notoriously horrendous experience of dealing with other major lines. Last year, there was a Wakefield/Wi-Fi Alliance study that found 76% of travelers would choose an airline based on wi-fi availability. (http://www.wi-fi.org/news_articles.php?f=media_news&news_id=847 http://www.wi-fi.org/news_articles.php?f=media_news&news...) A number which, I can only imagine, has been increasing over time. And, as we've seen (re: Starbucks) there's a big difference between wi-fi and free wi-fi. As far as I can tell skimming a couple searches, there doesn't seem to be any line that offers free wifi... yet. It seems like there's a coming sea-change, however. The going theory is that free wi-fi is going to be a standard check-box item by the middle of next year - with many assuming Virgin and SWA will likely be leading the way. On a related note, I fly pretty much exclusively Southwest. I took my first flight at just over a week old and have flown pretty regularly ever since. About 6-7 years ago, I made the change to flying SWA whenever possible and haven't looked back. Last time I flew to SF, it took two different flights with a transfer in between - and I got a free drink on both.
- mrduncan 16y ago
  Last year, there was a Wakefield/Wi-Fi Alliance study that found 76% of travelers would choose an airline based on wi-fi availability. I'd imagine Wi-Fi Alliance might have some biases here. Since in-flight wifi is just a satellite connection, I'm sure the overall available bandwidth is fairly limited. Charging for wifi is a good middle ground for airlines as a way to make a few extra dollars but also to keep usage to a level that the uplink can handle. Are their any airlines that currently offer free wifi? I know that SWA did during their testing phase a while back (which only consisted of 3-4 equipped planes) but they eventually started charging for it like everyone else.
  - amohr 16y ago
    Yeah, IIRC Delta had free wifi while they were testing it and Virgin's was free during the holiday season. And yes the wifi alliance has some biases, but Wakefield (http://www.wakefieldresearch.com/ http://www.wakefieldresearch.com/) is an independent research firm. That's a good point, though about charging in order to throttle bandwidth concerns. But that comes at a potentially high cost in public perception points. All it takes is one airline to say "Everyone should have free wifi, so now we do!" and there will be a big jump in people complaining about having to pay for it.
ertyuiolkiujhg 16y ago
I loved the comment about the "premium network carriers American, United, Delta, etc." I have never had a flight on one of these that was nicer than a good LCC (southwestern/Westjet) - even when you aren't outsourced to some rebadged regional jet minor outfit.
nandemo 16y ago
> How do you expect consumers to view flying as anything but a commodity when I can pay 2x more then the customer sitting next to me? Wait, if people pay such different prices for the same product, doesn't that mean that it's not a commodity?
- jballanc 16y ago
  No, a commodity is something you purchase based solely on price without regard for any differentiating factors related to provider. Think crude oil. Oil's price goes up, oil's price goes down, but ultimately you're only thinking about the price, not whether that oil comes from one large drilling conglomerate or the next. Oil is oil, and a plane ticket is a plane ticket.
  - Sukotto 16y ago
    The word you're looking for is "Fungible". One barrel of fuel oil is the same as every other barrel of fuel oil.
ekanes 16y ago
Note that in your example, you nicely added to your original point: "Virgin America has an entire fleet of brand new planes, comfortable seats, personal in-flight entertainment and wifi, and great staff." Note that unlike other airlines, Virgin has tied together that correlation between price and value. Virgin is selling predictability. You pay more, and ALL of their flights are awesome (because they're a brand new airline? Only time will tell...)

asmithmd1 16y ago

From the article: "So why is air travel, among the most differentiated experiences we have in the normal course of life, purchased by so many people as a commodity?" So not true. A restaurant is a much more differentiated experience and also a "perishable" one that people are willing to pay a premium for. JetBlue has TV's and SouthWest has free luggage but you can't pick your seat -- what other differences are there between airlines? I you think you hit the nail on the head with the airlines destruction of any price/value correlation. The table next to me might be getting a free appetizer or desert but they are not going to be paying 1/5 or 5x as much as I am.

city41 16y ago
> So not true. A restaurant is a much more differentiated experience and also a "perishable" one that people are willing to pay a premium for. Yes but a meal at a restaurant is the primary experience. People are deliberately seeking a good one as eating a fine meal is their intent. Flying an airplane is just a means to an end. An annoyance really. And in that mind set most people aren't going to care, myself included.
- hugh3 16y ago
  Also, as soon as you start treating air travel as an experience to be enjoyed rather than tolerated, it quickly becomes apparent that it's really bad value compared to ground-based enjoyable experiences. For instance, I can fly from LAX to Sydney for, say, one thousand dollars in economy, or (goes to check fares) sixteen thousand dollars in First Class. That's a thirteen-hour flight, so you're paying more than a thousand dollars an hour for whatever extra pleasure you get by sitting in a nicer seat, eating a nicer meal, and being brought drinks by a prettier stewardess. Alternatively, I could eat at the best restaurant in town for $200 and then go and sleep in a fabulous hotel room for $500. That's a far better pleasure-quantum-per-dollar ratio than anything you can get in the air.
  - patio11 16y ago
    Indeed, for the price of a trans-Pacific first class ticket, you could stay in a hotel room designed to look like a first class cabin, hire a comely young lady to bring you (and only you) all the cranberry juice you could drink in 16 hours, eat the best meal in town, get to pick your own movie, and have your doctor prescribe you something so that you spend the next actual plane flight unconscious.
    - hugh3 16y ago
      Of all the fantasies I've ever heard which involve a hotel room, a comely young lady, fifteen thousand dollars and all-you-can-drink cranberry juice, that's the dullest, I'm sorry.
  - philwelch 16y ago
    That's why I think there should be premium airlines which perform aerobatic maneuvers occasionally throughout the flight, because that would be entertaining. Bigger seats and better food? These people just don't know how to create an enjoyable experience inside an airplane.
  - gamble 16y ago
    Hardly anyone pays out-of-pocket for first-class tickets. I suspect 90% of premium cabin passengers are flying on their company's dime, have been upgraded, are using awards, or are non-revenue passengers. The few who pay their own way skew toward the investment banker side of things.

amohr 16y ago

+1 for Virgin. I've never flown (I live in Chicago and they don't hit O'Hare) but I've heard almost exclusively good things. They are doing exactly what needs to be done in these giant, somewhat stagnant industries - introducing a brand with a customer-centric model, offering a "premium" service. Of course, in the world of air travel, it takes surprisingly little to distinguish yourself from the notoriously horrendous experience of dealing with other major lines. Last year, there was a Wakefield/Wi-Fi Alliance study that found 76% of travelers would choose an airline based on wi-fi availability. (http://www.wi-fi.org/news_articles.php?f=media_news&news_id=847 http://www.wi-fi.org/news_articles.php?f=media_news&news...) A number which, I can only imagine, has been increasing over time. And, as we've seen (re: Starbucks) there's a big difference between wi-fi and free wi-fi. As far as I can tell skimming a couple searches, there doesn't seem to be any line that offers free wifi... yet. It seems like there's a coming sea-change, however. The going theory is that free wi-fi is going to be a standard check-box item by the middle of next year - with many assuming Virgin and SWA will likely be leading the way. On a related note, I fly pretty much exclusively Southwest. I took my first flight at just over a week old and have flown pretty regularly ever since. About 6-7 years ago, I made the change to flying SWA whenever possible and haven't looked back. Last time I flew to SF, it took two different flights with a transfer in between - and I got a free drink on both.

mrduncan 16y ago
Last year, there was a Wakefield/Wi-Fi Alliance study that found 76% of travelers would choose an airline based on wi-fi availability. I'd imagine Wi-Fi Alliance might have some biases here. Since in-flight wifi is just a satellite connection, I'm sure the overall available bandwidth is fairly limited. Charging for wifi is a good middle ground for airlines as a way to make a few extra dollars but also to keep usage to a level that the uplink can handle. Are their any airlines that currently offer free wifi? I know that SWA did during their testing phase a while back (which only consisted of 3-4 equipped planes) but they eventually started charging for it like everyone else.
- amohr 16y ago
  Yeah, IIRC Delta had free wifi while they were testing it and Virgin's was free during the holiday season. And yes the wifi alliance has some biases, but Wakefield (http://www.wakefieldresearch.com/ http://www.wakefieldresearch.com/) is an independent research firm. That's a good point, though about charging in order to throttle bandwidth concerns. But that comes at a potentially high cost in public perception points. All it takes is one airline to say "Everyone should have free wifi, so now we do!" and there will be a big jump in people complaining about having to pay for it.

ertyuiolkiujhg 16y ago

I loved the comment about the "premium network carriers American, United, Delta, etc." I have never had a flight on one of these that was nicer than a good LCC (southwestern/Westjet) - even when you aren't outsourced to some rebadged regional jet minor outfit.

nandemo 16y ago

> How do you expect consumers to view flying as anything but a commodity when I can pay 2x more then the customer sitting next to me? Wait, if people pay such different prices for the same product, doesn't that mean that it's not a commodity?

jballanc 16y ago
No, a commodity is something you purchase based solely on price without regard for any differentiating factors related to provider. Think crude oil. Oil's price goes up, oil's price goes down, but ultimately you're only thinking about the price, not whether that oil comes from one large drilling conglomerate or the next. Oil is oil, and a plane ticket is a plane ticket.
- Sukotto 16y ago
  The word you're looking for is "Fungible". One barrel of fuel oil is the same as every other barrel of fuel oil.

ekanes 16y ago

Note that in your example, you nicely added to your original point: "Virgin America has an entire fleet of brand new planes, comfortable seats, personal in-flight entertainment and wifi, and great staff." Note that unlike other airlines, Virgin has tied together that correlation between price and value. Virgin is selling predictability. You pay more, and ALL of their flights are awesome (because they're a brand new airline? Only time will tell...)