Welp. Alaska Airlines will scrap the Virgin America brand and, instead, re-bake itself to offer a new product and fresh attitude.
Like many, I’m not surprised by this decision.
It is probably the only rational move Alaska Airlines CEO Brad Tilden could make. Managing two very different fleets, two very different products, and two very different market positions was a herculean challenge which would not yield a return on investment for Alaska Airlines in the long run.
The question is: why wasn’t this band-aid torn off sooner? Why the Christmas snack on bacon donuts?
In a word: time.
Alaska needed to buy time to decide the alternative product it would offer customers and a rational deployment of that ‘upgrade’.
But was that time well spent? Errm…
— Alaska Airlines (@AlaskaAir) March 22, 2017
While Alaska has tried to play up the changes to the fleet which will be deployed by 2018 as positive, they are by any measure still downgrades from Virgin America standards and—perhaps more problematic—they are not up to competing with JetBlue’s product nor even the transcontinental product of the big guys.
Gone is award-winning IFE, replaced by BYOD entertainment.
The Premium product offered is a step down from Virgin America’s and no match for JetBlue’s Mint.
But this product is exactly what one might expect from Alaska Airlines and consistent with my post-AIX 2016 predictions.
Alaska has opted for rational and fiscally conservative cabin product which allows the airline to stay ahead of the likes of Spirit, with no ambition to target the loyal upper-middle low-cost LUX customers of Virgin America. Those customers will now likely gravitate to JetBlue.
I believe that Alaska will make this work. A low-cost product will keep the airline in the black. There is more than enough market for that, even if some loyal Virgin America flyers go elsewhere. But this the polar opposite of a bold move, which makes Alaska’s argument in favor of it a little bit sad.
Three months after the fun-loving ‘Different Works’ promotion, here’s how Alaska Airlines sells different now:
“Imagine arriving at the airport and immediately feeling welcomed to a fresh, modern experience.
“You know you’ll reach your destination on time with minimal hassle, and the airline you’ve chosen offers consistently low fares and more nonstop flights to more destinations from the West Coast than any other. At your gate, you can’t help Shazaming every song on the upbeat playlist, and the overhead announcements tell you what you need to know with a healthy dose of fun.
“On the plane, you make your way to a comfortable leather seat in a mood-lit cabin. For the next three hours, you’ll enjoy fresh, West Coast-inspired food and drinks; Free Chat with friends and family on the ground via iMessage, Facebook Messenger and WhatsApp; and all the free movies you have time to watch. Not to mention the personal power outlets throughout the cabin, so your devices arrive at your destination as ready for adventure as you are.
“Your airline is unconventional, just like you are.”
Alaska Airlines is trying to keep in mind what made the Virgin America brand popular with its core base and to, at the least, promise that same fresh attitude.
It’s a little bit awkward and difficult to imagine that Alaska can deliver that when its corporate culture is less free-radical, more reliable and cosy, but we’ll give them the benefit of the doubt.
A sunny disposition can go a long way, but the spirit of innovation which was the trademark of Virgin America is clearly now extinguished.
Bye, bye Virgin America. You were a superstar.
— Richard Branson (@richardbranson) March 23, 2017
Fortunately, JetBlue is still around and delivering fresh baked goods.
— JetBlue (@JetBlue) March 22, 2017