This is a story about Delta Air Lines, and about the most fundamental question any business has to ask itself. It’s also about the intriguing answer Delta seems to have found.
That question is: “What, exactly, do you sell?”
Do you sell a simple product? Or do you sell an experience, or maybe a convenience — a solution to customers’ problems?
It’s a philosophical difference, but it has a lot of real-world repercussions. In the airline world, it’s a big issue.
Should an airline think of itself as selling a commodity — a seat on a plane? Or should it think of itself as selling something bigger?
No need for baggage claim?
“Right now, we still sell airline tickets,” Delta Air Lines president Glen Hauenstein recently told the 3 Things podcast, hosted by Red Ventures CEO Ric Elias. “What we really want to sell is the journey.”
For example, as Hauenstein proposes, your “journey” would include not just the flight, but airport transfers and even luggage delivery–so that you could seamlessly book a trip from your home in Atlanta to your hotel in Los Angeles–and have your luggage delivered to you, so you never even have to go to the baggage claim.
“[We want] your luggage to find its way to your mode of transportation, and show up at your hotel or place of residence,” Hausenstein said. “If you use Lyft for ride-sharing, if you use Hilton or Marriott as your preferred hotel vendor, we need to know that. Then, we can provide you a curated experience from start to finish. That’s where we’re headed.”
The plans are apparently for what the airline would be like in about 2025. Not so long from now.
(The podcast isn’t actually available yet, but Hauenstein’s remarks were reported by Darren Murph of The Points Guy. TPG is also owned by Red Ventures.)
Best ‘Major Airline’
I read all this after having just reported on the airlines that fared best in TripAdvisor’s 2019 Travelers’ Choice Awards, which are based on the rankings and reviews that thousands of TripAdvisor users give various airlines during the past year.
As I wrote recently, Southwest Airlines was far and away the winner among U.S. airlines in the rankings. In fact, it was the only U.S. airline that placed in the top 10 worldwide.
If you look at the reviews that TripAdvisor quoted in announcing its placement, you can see why.
Nobody is talking about the commodity parts of Southwest’s business: things like on-time performance, or the fact that you can usually change flights without an additional fee.
Instead, they’re talking about the intangibles: the “friendly staff,” that “really cares about you and it shows.”
While Southwest took the overall top prize for North America, Delta Air Lines came in first in that ranking for its category: “Major Airlines.” (Southwest is considered a “Low Cost Airline.”
And it’s It probably isn’t surprising to see that the accompanying Delta reviews are fairly close in tone to the Southwest ones. It’s not so much about the product or the service. It’s about the feelings that the product and service inspire in the customers.
Getting past the numbers
Interestingly, moving away from a commoditized airline product doesn’t necessarily mean squeezing either more or less money out of the product itself.
For example, as Gary Leff at View From the Wing points out, Delta seats passengers nine across in some aircraft configurations, when rival airlines like United and American flying the same plane fit 10 in the same space.
So Delta ostensibly gives up revenue for passenger experience in that case.
But Southwest goes the other way sometimes. For example, it gets lots of good press for offering free bags and itinerary changes, but most passengers don’t fully use them. By bundling the features, Southwest arguably makes more money than it would by stripping them out and selling them as-needed.
Either way, it doesn’t really matter in a vacuum. Passengers who care mostly about price, schedule and features can get all that information in an instant now, and they make a pure commodity decision.
But lots of people don’t think that way. They go past the numbers, and they make decisions more on how an airline–or any company–makes them feel as a whole.
Was the trip pleasant? Did the employees seem like they wanted to be working? Is there anything about the company’s public persona that doesn’t square with my personal values?
In most cases, those are the customers you want. Because while you have to work a little harder to get them, they’re the ones who won’t abandon you quickly simply because another competitor offers a slightly lower price, or a slightly more convenient schedule.
In fact, as Delta seems to understand, you’re probably better off getting them to stop thinking about flying with you as simply “buying a ticket.”
Figure out instead how to make them think about “the journey”–and then inspire them to take it with you.