3 ways low-cost carriers are attracting corporates
Low-cost carriers (LCCs) don’t just look after the leisure market...
Many are introducing a business model similar to that of legacy carriers and specifically designed to attract corporates.
3 examples of how LCCs are tempting business travellers:
Who’s doing what?
easyJet has adapted its product to give business people – and their companies – what they want, with a major step forward coming in the form of the airline now being bookable via the booking systems used by travel agencies.
Germanwings,Lufthansa’s low cost subsidiary, launched three fare classes for its all-economyclass flights. ‘Best’ is effectively a business class product with all bells and whistles while ‘Smart’ is a standard fare with some extras, but ‘Basic’ is comparable to the traditional LCC with a seat at the back of the plane and absolutely nothing more.
All this is happening, just as legacy carriers are borrowing ideas from the no-frills brigade:
Virgin Atlantic and British Airways (BA) now charge some customers for seat reservations.
BA introduced ‘hand-baggage only’fares. Given that many business short-haul journeys are day trips it’s a good way to reduce corporate travel spend.
Too much choice
Thepay-for-what-you-use philosophycould be seen as a money-saving initiative, but it does create problems for those mining data for a strategic understanding and supplier negotiations.
Given the growing range of travel products and prices choosing the most appropriate option is more complex, andcorporates can really benefitfrom the expertise of TMCs.
A strategic travel programmeshould not be solely focused on procurementand the unit price as there are now so many variables with the improvements both legacy and low cost carriers are introducing.
For advice on how to manage ancillary fees and travel supplier offerings, call +44 (0)20 3353 0340 oremail us