Ryanair's Customer Service Charade

On its journey to become one of the preeminent airlines in Europe, one of the things that Ryanair has been brilliant at is defining the rules of the game in a way that suits them but not their competitors. For example, when the company was re-born in the early 1990s, it told us that air travel was not about frills or food or classes of travel but simply about getting from A to B as cheaply as possible. Customers bought the story and loved the low prices. More surprisingly, Ryanair’s competitors bought it too and starting falling over themselves trying to compete on price and generally doing it badly. They played Ryanair’s game and got hammered.

Emboldened by this success, Ryanair got more audacious and tried to convince us that they provided great service as well. To do this they redefined customer service in air travel to mean on-time flights and low levels of lost baggage. Well after all, when you fly point-to-point to airports in the middle of nowhere that few other airlines ever fly to, these are two operational measures that you should score well on! More traditional elements of customer service such as treating people with responsiveness and empathy were conveniently ignored. Instead customers were treated with contempt and generally told to pay up, put up and shut up! If there was any grief going, it was to be dished out by Ryanair and not the other way round. Yet again, Ryanair’s limp competitors thoroughly failed to make any capital out of this situation.

So hot on the heels of a profit warning that knocked €1.3m of its market value and the disastrous customer service ‘own goal’ of charging Dr. Sattar €188 to change his flight as he rushed back to the UK where his family had been murdered, the company has now promised to review its ‘abrupt culture’. Oh that it would be that easy. The company’s CEO, Michael O’Leary has been at the helm for over 20 years and its hard-nosed approach to be dealing with customers is ingrained in everything that they do. Efforts to change its culture will have little or no effect in the short-term which ironically is probably just as well. Ryanair’s culture works for them. It is an integral part of what make them different and as ever the essence of great marketing is not to try to appeal to everyone. And thanks to the UK’s Competition Commission putting the final nail in Ryanair’s attempt to acquire Aer Lingus this month, Irish customers at least will have a choice about who they want to fly with. 

Christy and Arthur have a falling out!

Legendary Irish singer/songwriter, Christy Moore has weighed into the now annual Arthur’s Day controversy by penning a hard-hitting critique of the event which he is planning to release on September 26, the same day as Guinness celebrates the fifth iteration of its 250^th birthday. For a musician who lived hard and documented in song, the travails of the morning after and more, it represents quite a sober reflection. It has also been quickly embraced by Arthur’s Day critics who dismiss the event as just a cheap marketing gimmick designed to sell booze. But are these critics missing the point?

Far from being a cheap gimmick, Arthur’s Day is marketing genius. By any commercial metric you care to use, the event is highly successful. Through connecting with live music events, the brand generates high awareness and very positive brand associations. Peer-to-peer marketing through social media and the attendant public relations coverage of the event itself has been estimated to be worth around €350m annually to the brand. What tends to be forgotten is that Arthur’s day was originally conceived as a vehicle for supporting Guinness’ channel partners, namely the pubs, who have been steadily losing sales as more consumers chose to drink at home. Bringing consumers into licensed establishments at 17.59pm generates a surge in sales for the distributor and of course for the brand itself.

So far from being a gimmick, Arthur’s Day has been a highly successful marketing initiative which probably explains why it also generates such a torrent of criticism. To look at it in isolation each year is to miss the much more important point which is what does society deem to be acceptable behaviour by businesses. Left to their own devices, businesses will push almost any boundary that will drive an increase in sales and profit – we need to merely look at the behaviour of the world’s major financial institutions (and our own) to see that. Ireland’s sporting organisations have been campaigning hard this year against proposed restrictions on the sponsorship of sports events by alcohol companies which they are well justified in doing when events like Arthur’s Day remain untouched by regulators. More than anything, the annual outcry against Arthur’s Day shows how guilty society is of not being able to see the wood for the trees!

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