Yesterday the UK’s Office of Fair Trading stated that Ryanair had agreed to be clearer about its additional charges, after refusing to co-operate with the self regulatory system administrator, the Advertising Standards Authority.
Just a few days ago they lost a case in Germany over their exorbitant fees for paying by credit or debit card.
Ryanair are not alone amongst the so-called low-cost airlines in perpetuating a culture of nickel-and-diming their customers. Easyjet don’t even publish a chart of their additional fees! There almost seems to be a competition for who can come up with the most ridiculous additional charges. A payment fee that is a compulsory part of buying the ticket because you can ONLY pay by card should just be part of the ticket. The taxes and fees that you have no choice in ought to be included up-front. Various other devious tactics such as default-checking the boxes for the optional, carry-on baggage, priority boarding etc can all bring in additional revenue.
The purpose for making all these fees ‘optional’ is to be able to present unbelievably low headline prices in advertising or on the homepage.
British Airways have prepared a comparison chart, comparing their prices with the two largest low-cost carriers out of the UK. The differences are staggering. If you’re travelling with a 20Kg bag (the standard allowance on BA), the luggage charges alone with Ryanair is £160 – more than the entire cost of an equivalent flight with BA. That’s before you even consider the farce of priority boarding, which sometimes isn’t even bothered with at the gate.
The question is whether customers are taken in by the promise of cheap flights. Ryanair have gone out of their way to cultivate an image of being cheap; witness the ‘we’re considering charging passengers to use the toilet on board’ nonsense earlier this year. The financial results of the cheap airlines compared to the traditional flag-carriers certainly seems to suggest that people only look at the first price, the additional charges keep getting added on as you go through the process – on the Ryanair flight they don’t even show you a running total – you have to fill in your details before you see the final price.
Then there are the other hidden charges: Ryanair often don’t fly to major airports, opting for obtusely named regional airports that are nowhere near the city they claim to serve, so you need to take slow or expensive transport to get to the place you thought you were going to.
The tide has begun to turn in the public perception, but the masses still haven’t taken notice. What is needed is a concerted effort by the industry regulators (as self-regulation hasn’t helped) and the decent airlines. BA are starting to get it, but until I see a ‘Ryanair price’ on their adverts to highlight just how much better value they are, I don’t think the message will sink in. When people finally get it, the days of nickel and diming your customers are over but you will forever be remembered as dishonest money-grubbers. Is it worth it?
The lesson for all businesses in this is that there are certain things it is fair to charge extra for and certain things that should be part of the up-front price. Sure you might get a short-term gain from screwing someone out of a few extra pounds, dollars or euros but if they’re never going to deal with you again because of it, you’d better be ready to spend a whole lot more money advertising for the next sucker.
Photo credit: Darren Hester
