Customer Focus or Profit Focus?

cutomer or profitsI’ve just experienced two flights on the same type of aeroplane, with two different companies, with two vey different experiences.

The two flights were to Egypt and to Miami with different firms both of which would qualify as low cost airlines, but they both go about their business in very different manners.

With flight to Egypt you really get the feeling that they put profits before the customer. The airplane seats were hard, definitely not comfortable, they didn’t recline and had no seat back pocket to store things which you might want during a 5 hour flight. Everything on the flight such as food, drinks – even water – were extra and it seemed that there was a constant effort to sell things during the flight. The inflight entertainment was a shared screen with no choices available.

Everything on the way the plane was set up felt like it was a low cost option, with low cost operations in mind rather than good service and customer satisfaction. The flight was uncomfortable and not a great start to a vacation.

With the flight to Miami the plane had a completely different set up. The seats were not only padded but had extra padding to make them more comfortable, they reclined up to 15cm which made it easy to relax and go to sleep. If you didn’t want to sleep then there was individual entertainment with up to 250 hours of different shows and music to choose from. There was a both a hot and cold meal included and all drinks were free, even alcohol, and they were very generous allowing people to make requests during the flight for additional drinks. They did offer duty free for sale but it wasn’t really a hard sell like on the Egypt flight.

These two experiences, coming within the space of 5 days, were very clear to me in what the companies were focused on. With the Miami flight it really felt like it was the customer, nothing seemed to be too much trouble, the flight was enjoyable, in fact it was a pleasure and we arrived relaxed at our destination.

With the flight to Egypt they were very clearly focused on profits, nothing about the flight was enjoyable, it was just a means to and end, a way of getting from A to B.

This is not the first time, in similar businesses, I have experienced these different business models, i.e. Customer Focused and Profits Focused, and each time my reaction has always been the same.

I will not, if I have a choice, use the company who was profit focused.

I do believe we need to pay attention to profits, but not at the expense of the customer, I think this is a very short-term, short-sighted business model which ultimately will either end up with your business going bust, or with a terrible reputation.

I don’t doubt that there will be some CEOs who will say, that as long as they are profitable a good reputation is just a bonus. But this really is short sighted because as soon as your customers have another option, in some cases any other option, then you will lose your customers.

It is possible to be successful with the customer first model, there are many companies who have achieved this, SouthWestern Airlines is one of my favourites, they operate and compete in the low cost airline space, but they don’t make you feel like you are receiving a budget service. This is one of the reasons why they have been profitable for over 37 years in a row.

The price difference between the two flights was negligible, as I mentioned both would qualify in the low cost class and were the cheapest flights offered to their respective destinations, but there was a gulf in class between the service levels.

Not only would I use the company – Air Berlin – that flew us to Miami for such a trip, but I have now added them to my preferred airline list, and will recommend to others.

The other company, unless the only alternative is that I have to walk, I will never use again.

If you focus on your customers then the profits will come, if you just focus on the profits then your customers could go!

Gordon Tredgold

#Leadership principles

 

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