Business First December 2017 December BF Digital | Page 68

THOUGHT LEADERSHIP
The birth of Ryanair and the Low-
Cost Airline sector
by Mark Tungate, author of The Escape Industry: How Iconic and Innovative Brands Built the Travel Business
carriers to greatly increase their scheduled
services across the region – an opportunity
Ryanair seized.
The Internet Revolution
he elements of the low­cost model are
more or less visible to passengers. They
include a single­class service, the use of
‘secondary’ airports that charge lower
landing fees (ah, the glamour of the Luton to
Beauvais run!), deploying staff in multiple
roles – the crew member who scans your
ticket at the gate shows up later to sell you a
sandwich – seats that don’t recline, and
additional charges for checked bags, on­board
snacks… and just about anything else they
can get away with.
Low­cost airlines also ‘hedge’ on fuel costs
by buying in bulk while prices are low, and
push for modifications in aircraft design that
allow for more seats inside and reduced drag
outside.
The internet, of course, changed everything.
Once passengers could buy tickets, register
luggage and even check in online, the entire
process of filling an aircraft and getting it
aloft could be streamlined – while direct
booking did away with the costs associated
with travel agents.
One of the main beneficiaries of this
revolution was Ryanair, notoriously the low­
cost carrier with the fewest frills of all.
It was started in 1984 by a group of Irish
businessmen, including Tony Ryan, founder
of aircraft leasing company Guinness Peat
Aviation. Ryanair began flying between
Waterford and Gatwick Airport to compete
with British Airways and Aer Lingus, adding
the Dublin–Luton route in 1986.
In 1992 the European Union deregulated
the airline industry, allowing European
T
Ryanair’s website came online in 2000.
Nine years later, it was able to dispense with
check­in desks: passengers did everything
online, apart from dropping off their bags.
Ryanair’s ultra­low­cost model was
occasionally satirized – but the airline itself
was happy to make outrageous statements as
a way of stirring publicity.
Around the time that it was poised to
remove check­in desks, O’Leary mentioned in
a BBC interview that the airline was thinking
of charging passengers £1 to use the on­board
toilets.
He later admitted that the idea was
unfeasible and went against EU regulations.
(‘Spend a penny, pay a pound with Ryanair’,
The Guardian, 27 February 2009.)
Ryanair took a similar no­frills approach to
promotions, with internally produced black­
and­white print ads that courted controversy:
a 2012 campaign featuring lingerie­clad flight
attendants under the line ‘Red hot fares &
cr ew’ was one of many to attract the ire of the
Advertising Standards Authority.
But the airline’s skeletal service also
equated to a lousy customer experience –
exacerbated by tetchy and impatient staff –
and passengers began to drift away.
Chastened, the airline launched a campaign
of improvements, such as allocated seating,
permitting a second carry­on bag and ‘giving
more flexibility for frontline staff to tolerate
minor infringements’ of its rules on baggage
size, for example.
Profits began to rise, although a drop in fuel
costs also contributed. (‘Fewer rules, less
hassle, more profit – how being nice paid off at
Ryanair’, The Guardian, 30 May 2015.)
Flying for Less 149
FlyBe, Wizz, Vueling, jet2.com, Air Europa…
the website Flylc.com (www.flylc.com) lists
no fewer than 32 budget airlines serving
Europe alone.
A Telegraph journalist was able to fly
around the world on 10 low­cost airlines,
from easyJet to Norwegian.
The entire round trip cost him less than the
equivalent of US$2,000. (‘Around the world by
budget airline: 10 flights, £1,653 –here’s how
to do it’, 8 April 2016.)
The sky­scape has changed utterly since the
1970s. Flying, while not always very
comfortable, has definitely become
accessible. We’re all part of the jet set now.
The Escape Industry: How Iconic and
Innovative Brands Built the Travel Business
by Mark Tungate, is out now, published by
Kogan Page, priced £19.99.
For more information see:
www.koganpage.com/product/the‑
escape‑industry
This extract from The Escape Industry by Mark Tungate is ©2017 and reproduced with permission from Kogan Page Ltd.
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