Thursday, May 21, 2009

AirTran's Approach to Business Class

AirTran Airways is running an interesting sale on business-class seats, by way of underscoring its unconventional approach to selling the front of the plane. Tickets must be purchased by the end of today, however, for travel through June 23. Round-trip purchases are not required, though a seven-day advance purchase is. Seats are limited.

Some sample one-way business-class fares: Atlanta-Boston ($149); Atlanta-Chicago ($159); Atlanta-Houston Hobby ($159); Atlanta-Los Angeles ($269); Milwaukee-Boston ($144); Milwaukee-Seattle ($249).

Last week, during a demonstration flight to show off AirTran's new Wi-Fi system, Bob Fornaro, the chief executive officer, told me that the business-class cabin and pricing strategies were central to AirTran's evolution in recent years from a strictly leisure carrier to one with a growing business-travel clientèle.

AirTran now lets you chose to pay extra at check-in, 24 hours in advance, to upgrade to the front of the cabin on its Boeing 737s and 717s. Depending on availability, it costs about $49 to upgrade from a Y fare on a short-haul flight, and $99 on a long-haul.

Obviously, promoting for-sale upgrades (and running business-class fare sales) brings into question the balance between selling seats up front and awarding them to elite-status customers. Fornaro said that so far, he thinks the airline has been able to maintain a balance.

[AirTran elite-status members: Please let me know if you disagree with that.]

"Business class has been our most important feature and has allowed us to transition from a completely leisure airline to an airline that is competing in both segments of the market now," he said.

"When I joined the company in 1999 we looked at it and said, is this something we should be doing? The company launched in late 1997. We gave it a trial, at a time when a a lot of or even most companies were not allowing people to buy business class, or first class."

So the buy-on-demand feature was introduced, coded to a coach fare. "It’s helped us at the beginning trial; we got the load factors us, and it's been a good entrée for us to break into corporate sales. It allowed us to bring something different to the party," Fornaro said.


No comments: