Speaking on a conference call following its first half earnings this morning (3 November), chief executive Michael O’Leary said the airline has so far focused on improving the buying experience but is now looking to develop other services to “keep people on our website”.
“We have spent a lot of time improving how we retail things, we are now looking at different developments where we put up competitor prices so people don’t have to go off to Skyscanner, a ‘rate the experience’ feature so they don’t have to go to TripAdvisor. There are more and more people coming to Ryanair for flight and fare information, we want to keep them by offering other services that before they would have gone to another website for,” he added.
O’Leary said it was also “inevitable” that Ryanair would roll out all-inclusive holiday packages on its website, although he admitted this “wasn’t high on the agenda” and wouldn’t be happening in the next 12 months.
The updates are all part of Ryanair’s charm offensive as it looks to shake off its reputation for bad customer service. O’Leary said “being nicer” to customers is paying off for the company, getting rid of tension points such as the boarding process when Ryanair used to “fight with passengers” over the size of their baggage.
The changes helped Ryanair post a 32% increase in profits and 4% jump in passenger numbers for the six months to the end of September, a trend that O’Leary sees continuing for the rest of the year. He said much of that growth is coming about because Ryanair is taking market share off airlines such as Easyjet, Alitalia and British Airways as it expands the number of routes and primary airports it flies to.
Ryanair tripled its marketing budget to communicate the customer service changes but O’Leary said that expenditure will drop off as Ryanair shifts marketing spend to focus on targeted communications.
The airline hopes to boost loyalty by offering incentives to customers to fly more often. Launching by the end of next year, these will include offers such as 50% off a flight for people that booked more than 20 flights in a year or an incentive to get people who booked four flights in 2015 to book six in 2016.
“We will run individually tailored offers recognising volumes for each passenger rather than a big cumbersome loyalty programme. We will encourage a ‘more flying programme’ for each individual passenger,” said O’Leary.
Ryanair also plans to use customer data to work with partners to provide additional services that might be of interest.
“In the old days we would have run around selling off that data. Now we want to bring more people onto the website and get more to register. Its about providing value for passengers,” he said.
O’Leary also shook off concerns that the improvements to customer service aren’t being noticed by customers. The airline was voted in the bottom three of a list of 100 brands rated for customer service by consumer group Which?.
“Long may we continue to be the second worst brand in the world when our travellers and profits go up. Sometimes pandering to the impression out there works but we are improving customer service and we have another two years to go. There is a lot of momentum in the business as we move into the second half of the year and word get outs that Ryanair is changing,” he said.