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Jocelyn Cripps, executive vice-president of global B2C marketing, Financial Times, asks: With airlines facing so many rising costs, which often have to be passed on to customers, how does AA provide a positive passenger experience and reinforce brand values to prevent customer churn?
Stephen Davis (SD): There’s no doubt that the cost of fuel is a major issue for all airlines. We’ve also seen the rise of low-cost carriers in the UK, Europe and the US. They operate a very different business model and their margins are very thin, which means it is difficult for them to provide a high level of customer service. We are primarily oriented around being a business-class airline, so we focus more on what we call the premium cabins. The fares we offer reflect the products and services we provide, but people pay to travel in a particular class of comfort.
Andrew Cocker, chief marketing officer, Skyscanner, asks: Most airlines have traditionally marketed and sold ancillary services such as meals, seats and extra luggage via their own channels. Would you consider selling these via travel intermediaries to boost sales?
SD: The whole question around what we would term merchandising – additional added-value products and services – is part of a plan to grow extra revenue, which is very important. It’s another way we look to add value and differentiate to survive and be profitable. But I don’t think we would provide those products to online travel agents or meta-search players. Their business model works in terms of selling flight tickets and we’re happy with that right now. It also gives us an opportunity to differentiate and add value through our website, so when customers are booking directly through AA.com, they have the opportunity to pick up extra products.
Nicolas Hauvespre, regional director of marketing, Starwood Hotels Western Europe, asks: Given how competitive the airline industry is, what do you do at AA to differentiate yourselves from the competition and continue to evolve the offering to your clients, especially as you are up against newer arrivals in the airline world?
SD: It’s all in our strategy of brand and fleet modernisation. We’re investing a lot of money in building one of the newest airlines globally and with that comes the opportunity to redefine the onboard service proposition, while the external manifestation of that is our new brand and livery. We add value and differentiate through our onboard products and services, and the comfort we provide for passengers.