Wednesday, June 04, 2003
Lather, Rinse, Repeat
The airlines are heading back into the food service industry, hoping to sell food to passengers. Once upon a time, airlines were a flying 3-star restaurant; then, they cut corners with meals so they became a comedy cliche to the point that airlines phased them out. Now, we see food returning, but on a pay-as-you go basis. I wonder though whether they won't get themselves into a competitive cycle such that, after all the major carriers offer the service, some airline won't offer the food free as an inducement to customers to switch airlines, touching off a new cycle of freebies, corner-cutting on quality, elimination of food service.
Perhaps these cycles are inherent to the competitive process, in which differentiation is the method for effecting changes in consumer consumption. But, it is stupid, another example of irrational results of rational behaviors (e.g., cycles of clothing fashions, cycles of nostalgia). You would think after decades of organizational and business research, somebody could figure out how to break cycles on a consistent basis without sacrificing market position.
In the airlines' case, it seems the individual carriers operate as poachers, focusing on skimming clients from other carriers and not focusing on serving their regular customers. O.k., sure, upgrades here and there as part of a frequent flyer program are nice, but they are not free because the passenger buys them over the course of time on overpriced flights. The flyer is not actually better off, though they may perceive themselves as better off. What would make them better off is reducing waiting times before and after landing, competition for runway slots at airports, and other reducing the factors that waste customers' time and money.
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