southwest airlines

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Ticketing was another area where Southwest was able to realize cost savings. Southwest was the first of the major carriers to offer electronic ticketing (e-tickets). Electronic ticketing costs $1 per ticket compared to estimated $8 for paper tickets. Much of that difference was in labor costs. Besides labor costs, E-tickets also helped Southwest economize on commissions to travel agents. Passenger traffic commissions accounted for only 5 percent of Southwest’s operating expenses compared to 8 percent for Delta and United Airlines. By 18, other major airlines had introduced electronic ticketing. Southwest, however, with over 60 percent of its passengers flying on e-tickets, still issued a far greater proportion of tickets electronically than other major airlines such as Delta who had reached 4 percent by mid 18.

Ticketing was another area where Southwest was able to realize cost savings. Southwest was the first of the major carriers to offer electronic ticketing (e-tickets). Electronic ticketing costs $1 per ticket compared to estimated $8 for paper tickets. Much of that difference was in labor costs. Besides labor costs, E-tickets also helped Southwest economize on commissions to travel agents. Passenger traffic commissions accounted for only 5 percent of Southwest’s operating expenses compared to 8 percent for Delta and United Airlines. By 18, other major airlines had introduced electronic ticketing. Southwest, however, with over 60 percent of its passengers flying on e-tickets, still issued a far greater proportion of tickets electronically than other major airlines such as Delta who had reached 4 percent by mid 18.

Ticketing was another area where Southwest was able to realize cost savings. Southwest was the first of the major carriers to offer electronic ticketing (e-tickets). Electronic ticketing costs $1 per ticket compared to estimated $8 for paper tickets. Much of that difference was in labor costs. Besides labor costs, E-tickets also helped Southwest economize on commissions to travel agents. Passenger traffic commissions accounted for only 5 percent of Southwest’s operating expenses compared to 8 percent for Delta and United Airlines. By 18, other major airlines had introduced electronic ticketing. Southwest, however, with over 60 percent of its passengers flying on e-tickets, still issued a far greater proportion of tickets electronically than other major airlines such as Delta who had reached 4 percent by mid 18.

While other airlines wondered how to address fears of terrorism and other threats, Neeleman comforted customers by acting quickly. With just one aircraft model, JetBlue was able to engineer new safety features much more rapidly than competitors after Sept. 11. It was the first to retrofit each of its planes with reinforced cockpit doors and onboard surveillance cameras.




But Neeleman knew he couldnt depend just on tight security and tasty junk food. To reach out to the 1 million people living within a 60-mile radius of New York City, he relies on Amy Curtis-McIntyre, a veteran of Virgin Atlantics marketing department, to develop ad campaigns that are high on creativity and snarkiness. A native New Yorker, shes primarily responsible for the hip image JetBlue has developed. He wanted cheap and cheerful, says Curtis-McIntyre. I wanted cheap and chic. We used to have job-threatening battles about how to approach advertising.

Ultimately, they compromised on cheap and cheeky. Billboards in New York promise Free TV With Every Purchase. In the Los Angeles area the company pushes flights to San Francisco with its From smog to fog advertisements. One spot, targeted at New Yorkers, depicts what a subway car might be like if it were a JetBlue flight. Crew members dance through the car inserting pillows under passengers heads, placing blankets over sleeping bodies, pouring coffee in the cup that a beggar is using to collect change, and so on. All the while, they dance with passengers and sing Put a Little Love in Your Heart. This approach is selling well among both New Yorks bargain-hungry and its most affluent, and its earned JetBlue a loyal and loving following. According to the airline, the majority of the tickets it sells out of New York are to people who live within the Upper East Sides 1001 zip code, Manhattans version of 010.

But is his brand of niceness enough to help JetBlue maintain its edge in the long run? After all, company values and all that sweetness are great when business is going your way. Labor costs are likely to rise if employees unionize in the next couple of years. Neeleman has tried to head that off with a package that gave employees 15.5% of their gross salary in profit sharing last year, but that may not be enough. Then theres the inevitable aging of its planes, which will need costly repairs. Weve factored those added expenses into our plan going forward, argues Rhoades.

Competition from other airlines is also looming, and each has its own take on cheap and cheeky. Delta launched its discount spinoff, Song, this month with daily flights to West Palm Beach from all three major New York City airports, perhaps gaining an edge over



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