Friday, February 27, 2009

A Pound To Take Leak?

I really enjoy finding value offerings that use value as a brand as opposed to a simple pricing strategy. In airlines, this is led by Ryan Air.

Ryan Air have an interesting model that uses passengers to get airport slots, while making their profits off air freight. Hence you will often see airfares at for a few Euros. While Ryan Air has the reputation for surly service and terrible on time records, consumers are fine with it because the costs are so cheap.

This model has come under pressure as other low cost carriers have used the same idea (Jet2, Easyjet etc). So Ryan Air has introduced the ultimate a la carte approach to travel... extra charges for checking bags, checking in at the airport etc etc.

This has reached a new extreme with Ryan Air considering a $1.40 charge for using the toilet on a flight.


The fundamental value strategy of Ryan Air is strong, but there is only so far that you can push the consumer. Most of their charges are something you manage and opt into. But charging for toilet use on a flight is extortion, and different to every other a la carte charge.

Will this take the carrier down? Probably not. Consumers will pay the pee charge and be happy to fly cheaply. But it may be that on some flights, it will cost more to use the facilities than book the flight...

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