Fly Less, Pack Them In, Charge Them More…

Sam Wolf

08.14.15

Fly Less, Pack Them In, Charge them fees for what used to be included, increase the rates, make more money.

Now that’s innovation!

Businesses have to make a profit. Without profit a business cannot bring a return to its investors, pay more to its employees and pay its suppliers.

The market rewards businesses that bring new value to the market place. Innovation drives new value by doing something new or better than it has been done before. My new computer weighs 1/3 of the last one and runs faster and turns on in a few seconds. I am wiling to buy it because it saves me time and it is easier to carry.

The airline industry is in an interesting place these days. In order to make a profit they are choosing to bring less value and charge more to the market of travelers. This contradicts how the market should work.

Were they too cheap to start with and now they have to make it up by cutting service, unbundling their pricing structure and packing more people in the airplanes?

Has airline travel turned into a pure commodity that is totally price driven? Will people pay for service, comfort, and most importantly will people pay more for their time not being wasted?

I have compared the airlines to mass transit forms such as the metro rail systems in major cities. More and more it seems that is what they are settling into becoming. And maybe that is OK. There is a need to move masses of people between cities here in the US and between the US and other countries. The cheaper the costs the more people will travel.

So the question that begs an answer.

Is there a market of people who still believe travel is not all about the least amount of dollars spent on the seat to get them where they are going? Will some group of travelers look at the value of their time and the social or anti social experience of travel and seek for a better solution.

I believe the answer is yes.

I am starting to see companies truly innovate and come to the market with solutions to meet the needs of travelers who are willing to pay more for a better experience. Like any market experiencing innovation, some ideas will work and some will fail, but the market will adapt for the betterment of the traveler.

In our case I see general aviation doing some cool things to fill in the gaps. It is a good time to be in our business.