Higher profits and bookings ‘validate’ customer service improvements, says Ryanair
Ryanair has credited the “success” of its “Always Getting Better” customer service improvements for increased profits and bookings.
By Sarah Vizard
For the half year to the end of September, Ryanair’s profits were up 32% to €795m, while total revenues increased 9% to €3.54bn. Traffic grew 4% to 51.3 million customers and load factor, a measure of how full each flight is, was up 4% to 89%.
That is a turnaround from a year ago, when Ryanair issued a profit warning and was criticised by both customers and shareholders for its poor customer service. That sparked the airline into action, with Ryanair embarking on an ambitious plan of improvements including lowering fees, increasing focus on its digital offering and introducing options for both business and family travellers.
The airline also hired its first CMO in Kenny Jacobs and has embarked on a marketing blitz aimed at communicating its new image, including TV ads.
The airline says its improved website and new mobile app have made it easier for customers to make bookings, while the improved customer service is attracting more consumers. That has resulted in forward bookings for December to March increasing by an average of 5 per cent compared to a year ago.
Ryanair now claims to be the number one airline website in terms of visits, having overtaken both British Airways and Easyjet over the past six months, citing figures from Hitwise. Chief executive Michael O’Leary says the airline’s new Labs development team will continue to roll out more innovative services and features on both the website and mobile app through 2015.
Ryanair says the launch of its new business and family products are also helping the airline win new customers from all its higher fare competitors.
Based on the half year results and strong bookings Ryanair has raised its profit guidance for the rest of the year, expecting the figure to come in at between €750m and €770m, ahead of previous guidance of €650m. Traffic is expected to be up by 12% in the third quarter and 20% in Q4 as the airline aims to attract more business traffic, which tends to increase over the winter.
