An Airline Innovation - "Cuddle Class"

by Kevin Roberts

Innovation comes from the edge. For most European travellers the edge of the world is New Zealand. That means a 24 hour flight, and there are plenty who don't want to part with a huge amount of cash for business class - where you can get a real sleep. So congratulations to Air New Zealand for putting on their thinking hats and solving some of the negatives of long haul travel. Skycouches on their new Boeing planes mean that three seats form one bed, with an extra panel raised from the footrest area to give space for two to sleep in what they're calling "cuddle class".

Economy/coach class can be a tough ride, so the opportunity to lie flat with your partner and sleep off the miles will be too good to pass up. There's little mystery on a flight like this, and sensuality takes a back seat unless you're prepared to pay more, so adding a little bit of intimacy to the mix seems like a great solution to me. You arrive at your destination, not prodded by strangers' elbows and plenty of sleep interruptions, but after a sleep, a meal, and lesser chance of DVT. It costs a little more, so let's see how it goes. While Air New Zealand are ahead of the game in solving a long distance issue - there must be plenty of ways other airlines can innovate for shorter flights.

I won't bother challenging the major US airlines, who need a whole culture change before they can come close to getting this far (JetBlue and Virgin America being honourable exceptions), but I'm sure other carriers can continue to innovate, push the boundaries for economy as well as business and first class. Everyone is on the same plane together! Perhaps they can look at the other innovation from my national carrier - Spaceseats. Two abreast and designed to shape in to allow couples to dine together. You choose - the back of a seat, or at best a small TV screen, or the smile of your loved one facing you. And for those who are not couples, who knows? You might even make a new friend.

Image source: Vielflieger-blog

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Kevin Roberts is the CEO worldwide of The Lovemarks Company, Saatchi & Saatchi. For more information on Kevin, please go to www.saatchikevin.com. To see this blog at its original source, please go to www.krconnect.blogspot.com.

Innovation by Subtraction

by Paul Sloane

We tend to think that the best way to innovate is to add new features to our products or services. What can we add that increases the appeal of our offering? This route can easily lead to extra cost, feature overload and customer fatigue. Sometimes a better answer lies in subtraction.

Michael O'Leary, the founder of Ryanair, looked at the business process of passenger flights and built a new model by subtracting all the frills that meant extra cost. He subtracted:

• Travel agents - you book direct over the Internet so the middlemen and their costs are cut out.


• Tickets - you show your passport and quote your reference number. Subtracting tickets saves costs.


• Allocated seating - you choose a seat when you get on the plane - just like on a train or bus.


• Free drinks and snacks - if you want a drink you have to buy it.


• Customer care - Ryanair has one-tenth the number of customer care attendants per passenger mile compared to BA. If you have a complaint the answer is generally - 'hard luck but what did you expect with such a cheap flight?'

(Editor's note: In the U.S., JetBlue, Virgin America and Southwest Airlines operate using a very similar model)

What can you take away from your current business process in order to save cost and simplify operations? Can you unbundle your product into separate components? Can you strip out costs or processes that not all customers want? Can you bypass a middleman on the route to your customer - as Direct Line, Amazon and Ryanair did? Egg and First Direct offered on-line banking and made it cost effective by cutting out all the branches that burden the traditional banks.

Sometimes you can get the customer to do something that you do right now. The supermarket was a remarkable innovation in the 1920s. The key new idea was to get the customer to serve themselves rather than having an assistant serve them. A modern updating of the idea is provided by IKEA. Not only do customers act as assemblers in putting the furniture together, they also act as store men in collecting the flat packs from the warehouse.

The whole do-it-yourself business was built on the back of getting individuals to do what tradesmen had done for them in the past. eBay has built a business that runs like clockwork by getting the clients to place their own advertisements, hold their own stock, sell their own goods and give each other recommendations. It is a triumph of transferring services to clients.

Next time you face the challenge of how to refresh your product don't just think about adding new features or services. Think about what you can cut out of the process or product. How can you make things simpler, less costly and more appealing to customers?

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Paul Sloane writes, speaks and leads workshops on creativity, innovation and leadership. He is the author of The Innovative Leader published by Kogan-Page.

The Right Way to do Social Media

Click above to Enlarge
by Braden Kelley

Unfortunately, more often than not I see examples of social media strategy gone wrong. So, it stands out when I see a company like Lufthansa doing social media the right way - at least with their MySkyStatus site. Let's look briefly at why this is a good execution of a social media strategy:

1. Easy to use


2. Gives the customer something of value with minimal effort


3. The value is something that people naturally want to share


4. Works just as well with the competition's product as with their own


5. Gives customer a visual idea of what they are going to get before they invest any time or effort


6. Brand impression is minimal, and no fear of mentioning the competition


7. It gives the user a choice of how much information they want to disclose

Now if we can convince the airlines that charging people for extra bags and other pointless fees are a bad idea (like Delta Airlines charging me $50 for the "privilege" of standing by for an earlier flight with open seats), then the world will be a better place.


What other examples of well-executed social media campaigns would people like to share?

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Braden Kelley is the editor of Blogging Innovation and founder of Business Strategy Innovation, a consultancy focusing on innovation and marketing strategy. Braden is also @innovate on Twitter.

Abuse Customers at Your Own Risk

Long time readers of this blog will know that my love for most airlines in the US has never taken off. In fact, I'm constantly amazed by the continued indifference many of them have towards the consumer, not to mention the consumer's resigned acceptance of the service they're offered.

Not everybody is content to lie down and be trampled on by the commodification kings of the sky. Dave Carroll is an Internet hit after he wrote and uploaded a video to a song called "United Breaks Guitars" about...you guessed it, United Airlines breaking his prized Taylor guitar. Initially complaining, Dave was met with indifference from three flight attendants. A week or so later, he made a complaint which turned into weeks and months to call centers before his claim was inevitably refused. You know the story. So Dave has had his revenge, and another YouTube star was born.

As soon as United heard a public relations storm was brewing, they got in touch with Dave to put it right. Good on Dave Carroll for saying that United "has generously, but late, offered some compensation but would rather see the money go to a charity of their choice." I'm not sure if Dave needs the money now - he's gearing up for the second of his three promised songs on the subject, and has more PR for his band than he could have dreamed of.

This is another example of the increasing power of social media. Consumers have the ability to talk back and change things. The effect of Twitter on Sacha Baron Cohen's film Bruno is another example. It debuted at US$14.4 million at US and Canadian box offices, but fell to US$8.8 million the next day. The consumer is boss and in immediate control.

For their part, United Airlines have said "Dave's video is excellent, and we plan to use it internally as a unique learning and training opportunity."

A message to the US airline industry: It's not about doing things right some of the time, it's doing things right all of the time, even when you think it doesn't matter. YouTube, Twitter, and co. say it does matter. Customer relations can be a joyful experience, from both sides. Check out this guy to see how it's really done!

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Kevin Roberts is the CEO worldwide of The Lovemarks Company, Saatchi & Saatchi. For more information on Kevin, please go to www.saatchikevin.com. To see this blog at its original source, please go to www.krconnect.blogspot.com.

Targeting By The Seatback Of Your Pants

Flying to Hawaii a couple of weeks ago, I was remined of the phrase, "You may be talking but nobody is listening." Hawaiian Airlines had seen fit to pollute the cabin with an endless stream of untargeted advertising on the plane's set of televisions (no fancy seatback units here).

Now, at least on American Airlines the "advertising" mostly masquerades as entertainment (CBS sitcoms or clips of Letterman and 60 minutes) to try and loyalize the shows' base or to pull in new viewers, but it's still advertising. American Airlines has traditional advertising as well, but less than what I saw on Hawaiian Airlines.

Broadcast networks have at least some justification for spamming people over the airwaves (it's their only revenue source and they are only able to target based on dominant audience profiles). The availability of on-demand, seatback entertainment systems, leaves airlines with no excuse, and in fact every motivation as advertisers would willingly pay more for targeted impressions.

For targeting purposes, the airlines know who purchased the ticket (likely their age (senior/adult/child), phone number, e-mail, address, zip code, how much they paid, the credit card they paid with, etc.). About frequent fliers they will also know how frequently they fly, their home airport, and maybe even whether they are travelling on business and for which company. So it would definitely be possible to design a system to target advertising in-flight.

At its simplest, airlines could define the programming schedule as a mixture of content blocks and advertising blocks (interstitial advertising) and target the advertising by seat, using passenger data. Passenger data could be loaded up at the beginning of each flight by a gate agent using a USB key, smartcard, or other portable data storage device. Every seat could potentially receive a different combination of commercials during the flight.

Airlines wishing to avoid interstitial advertising could design a more complex system to support advertising that would appear during the programming (as banners, or whatever). Whichever way the airlines went, they have the opportunity to create a system that would likely attract the highest rates for video advertising on the planet to help them pay for the increasingly expensive fuel to fly the plane.

Now where did I put that ticket again?

P.S. I also thought it was interesting that Hawaiian Airlines has chosen to go "cash-free" and only accept debit and credit cards. I agree with offering it as an option, but I'm not sure I agree with abandoning cash. Why would you want to do anything to make it more difficult for people to give you their money?