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FDOS, I agree with your post there. Perhaps another way of describing it is only supply a product for the minimum cost maximum price while you can. Once the market changes, react to it, and react quickly by a combination of lower prices and better service. I figure if things do change in the market (mainly North American) then the first thing BA would do is lower prices to protect market share, and then push prices back up as new and improved products are rolled out.12 Jun 2016
MrMichael – 12/06/2016 18:54 BST
The risk though, in strategy terms, is the assumption that pricing elasticity will be able to protect share.
It may or may not be the case, depending on competitor gambits.12 Jun 2016
I agree FDOS, there is risk involved, but no company was ever successful without taking an element of controlled risk. It might surprise you to know that I don’t think BA is anything like what it could be from a customer perspective. The hard product is outdated, the soft product is to put it politely, inconsistent. I don’t think BA on the whole has its currently strategy wrong, but I do think yields and loading must b closely monitored and where competition is having a significant impact react to it. The great thing about the LoCo’s was that they did not compete head on with BA, preferring smaller airports well away from the then mass market, that’s changing, and BA have chosen to compete on price not product. Whether that is the right or wrong strategy, only time will tell, but at the moment it is doing ok, so I will keep my shares. If things change, I can sell quicker than BA can do something to win travellers back.13 Jun 2016
MrMichael – 13/06/2016 06:57 BST
Yes, companies take risks, but normally this involves new iniatives.
There are many choices of strategy, depending on the view of the people deciding.
Take a look at the file here
Where would you place BA? I’d say ‘Maintenance of Superiority’ is probably the choice.
In the short and medium term, it’s a sound startegy, the numbers show that.
But is it sustainable, with a change in environmental factors?
The French government spent a fortune on the Maginot line, the German army outflanked it through the Ardennes – I don’t normally use military strategy in a commercial context, but this one is often instructive.
If laws change or some other environmental factors acts as an accelerator, then BA could be outflanked – if a recession comes and travel volumes drop, then the business could swing from profit to loss very quickly.
Like you, IAG is probably sitting there thinking about getting the best return out of the SBU, whilst knowing that it also has other options in the long term.13 Jun 2016
Just checked in in MAN T3 for hop down to London (internet checkin not working).
For years there has been a dedicated Gold/F/J/C desk, but it’s gone…..
Another enhancement.13 Jun 2016
FDOS, agree with you, with a large element of Selective Expansion as evidenced by BA’s strategy of seemingly concentrating on LHR/LGW to USA flights.
Let me ask you something now FDOS. If you were No1 at BA, would you start a long haul route, lets say MAN-JFK? You have to consider basing crew there (or at JFK, may be easier) routing timetabling via JFK so the aircraft can be swopped with LHR based aircraft (maintenance) etc etc.
I figure one of Virgins problems is they serve from too many airports and are constantly having to ferry their crews and aircraft to and from all over the UK, Glasgow, LGW-LHR, Manchester. Their fleet seems to spend almost as much time in the air on positioning flights as it does revenue flights. Must cost a small fortune.13 Jun 2016
MrMichael – 13/06/2016 11:46 BST
If I was in charge at BA, I wouldn’t take any piecemeal actions.
Set the mission and objectives, analyse the market, make choices, select the strategies to implement and then do/review.
MAN-JFK may or may not fall into the mix, but I wouldn’t be doing it as a one off.13 Jun 2016
I’ve just booked Milan to Singapore with Qatar Airways in biz, in their latest sale (ends this evening!). £2005 for two people! A grand a head.
It would be nice if BA could occasionally do some super-deals like that. Their sales aren’t bad, but…
But like others, it’s the steady erosion of service that is now turning me off the airline, and the latest two-ticket bag booking ban is probably the straw that will break the camel’s back. I’m going to start looking at Star Alliance for my travel next year and onwards, and I’ll just pop my collection of Avios as and when..13 Jun 2016
I just wanted to add to this thread, I have just been shown a post from British Airways own Yammer page that Headphones for the inflight entertainment in World Traveller are to be bulk loaded in an attempt to cut costs and reduce waste. The crew will expected to deliver a basket by hand AFTER take off offering headphones to those needing them. This ‘service’ fly’s in the face of BAs much hyped ‘Gate to Gate IFE’ introduced several years ago. They will be bulk loaded to 70%, so with a full A380 economy only 212 sets of ear phones will be loaded for 303 people, those 81 who didn’t bring their own will POTENTIALLY be offered compensation. ‘ To Fly, To Serve’.
What I seen was a page full of crew up in arms about the damage this will cause and untold hassle created onboard. Comments from the ideas protagonist were that the change was essential to ensure “we are offering a competitive product”. The protagonist was also very annoyed that a select group of crew who were used as a focus group ‘leaked’ the idea and that the decision was all but made. Some of the comments made reference to the last ‘service enhancement’ made by the ‘office crowd’ in Club of male and female was bags that were loaded without ear plugs and eye shades due to ‘market research’ and how big a disaster it was. Some of the comments made reference to BAs bonus culture that the protagonist was simply embarking on this cost cutting exercise to save some money and bag a nice bonus.
The spiral to the bottom continues unabated and with increasing speed and ferociousness.13 Jun 2016
esselle – I flew MAN-LHR yesterday and had the same problem. There were three BA staff at the check-in desks but only one actually doing the checking-in of passengers. When I eventually got called forward to a desk I was advised I should have come straight to that one (as I am a SCH). There was no sign above the desk to suggest it was anything different from the regular check-in but, according to the BA-staffer, there are problems with the airport authority’s ability to correct this. Written on a small sign atop a metal post that was obscured by others waiting to check-in was the info we were looking for – of course, it was too late by then!
Anyway, for future info, just look for the little sign 20-feet in front of the check-in desk on the far right and you should be able to avoid the big queues!13 Jun 2016
I hope this is not true, but I don’t think they’d be the first to do this. I could be wrong, but I’m pretty sure I’ve seen this on what was US and more recently in AA in Y.
If they do go with this, I wonder if they will be the AA like in-ear earphones rather than the hideously cr*p ones you get at present in BA Y. Though to be fair to BA, most airlines over the head earphones in Y are barely fit for purpose.
It would be madness to ever have a position where a pax couldn’t have a set of earphones because not enough were loaded. (Even though a number of pax bring their own earphones on board).13 Jun 2016