Excessive cost cutting?

Just flew Economy on Virgin (have flown many times) from SYD to HKG.

When I last time flew this exact route in Economy in July this year, there were:
- snacks (nuts or pretzels) handed out soon after taking off & refreshment towel
- cheese & crackers with the meal service
- the containers for the salad & dessert were made of hard plastic
- a proper VS branded glass (in addition to the plastic tea cup)
- free snacks at the galley at the back of the plane

Now, all these things have been removed and the containers are made of a flimsy type of throwaway plastic.

The feeling I get now when I'm on-board VS in Economy is like I'm on a LCC and have bought a bare bones meal service. Incredibly, upon enquiring with one of the VS staff on the plane for some snacks (as I had come to expect from my recent experiences on VS), I was told to get my fix of snacks from the Duty Free cart...

I used to really enjoy flying with VS but these latest cost-cutting measures make them seem like cheapskates now. Actually, I really hope I was just on a bad flight and all the things I had come to expect from VS are still there.

This is exactly the reaction to the cuts that has been predicted - it's so difficult to understand why these savings are considered sensible?

[Nottingham Nick]

I don't think many people will disagree - there are a large number of threads with exactly the same theme on this site and others on the internet.

I can see the initial need to slim costs in order to stay in business. But it is no good if the cuts, that are meant to help you survive, are the very thing that drives away your loyal customer base and causes you to .... errr... go out of business.

Surely, it is better to go down fighting as a market leader and innovator fighting the recession with all you strength, than to fade quietly into obscurity because no one wants to fly with you any more because of service cuts and dirty planes?


Nick

Completely agree with you Nick I don't even get recognised as a gold card holder yet BA always make a fuss. We all fell in love with Virgin because it was special the less special the less reason to book Virgin.

If I were flying in Y, I would never consider flying with VS period. The term holiday airline now springs to mind. Which is a shame to cheapen something that attempts international branding. As a business you only loose your customers once and once your reputation is tarnished, it stays that way.

UC is a good J class product still overall but they must be careful not to cut anything else.

[Scrooge]

quote:Originally posted by centurionman

UC is a good J class product still overall but they must be careful not to cut anything else.


The seat is good, the crew the vast majority of the time is good, the rest..... There are far better out there.

When the cuts first started (little red pillows) we all sat here and debated what VS would take away next,not just in UC but all classes, well I think I am pretty safe in saying that non of us thought VS would cut so deep.

I am sorry to say that when we plan our next set of flights, VS won't even be in the picture, until they start to show me that they actually want to try and put a better product out there for the premium they charge they will remain far down my list.

[Neil]

I'm not disputing what you are saying Dave but whilst the load numbers are still very good, which has been reported numerous times. Even the crew are saying how full both PE and UC have been lately and VS are continually doing well in all the travel awards the bean counters are not going to change their ways.

So are we all wrong? Are VS being very clever? I really don't know!

quote:Originally posted by Scrooge
I am sorry to say that when we plan our next set of flights, VS won't even be in the picture, until they start to show me that they actually want to try and put a better product out there for the premium they charge they will remain far down my list.


I totally agree. I think one needs to be 'unblinkered' with regards air travel these days. It may have been the case before the beancounters started drastically chopping away at the product, but VS now needs to understand that, for a variety of reasons, it is no longer the automatic first choice.

Sure, UC still more than holds its own with seat and crew - and has a big plus with Clubhouses - but other companies are catching up on what once was a novel, vibrant and evolving product. Further down the pricelist, PE and Y can no longer claim to be leaders in their fields and, in fact (dare I say it) some charter companies have exceptionally good products out there too.

[RichardMannion]

quote:Originally posted by Treelo
Sure, UC still more than holds its own with seat and crew - and has a big plus with Clubhouses - but other companies are catching up on what once was a novel, vibrant and evolving product. Further down the pricelist, PE and Y can no longer claim to be leaders in their fields and, in fact (dare I say it) some charter companies have exceptionally good products out there too.


I'd have to disagree with you there Treelo in regards to Seat and Crew. UCS is no longer class leading by any stretch, and the crew are still a little too inconsistent in my book. Clubhouses are good, but Vs is diluting this with the recent changes, and others are catching up fast (especially BA and SQ).

Thanks,
Richard

As much as I would love to see everything reversed. The fares are at the lowest they have ever been and until they can charge a realistic fare in all cabins then nothing can be improved unfortunately. After tax they are getting about 30 quid for taking someone to NYC how much free food, drink, movies, headsets, amenity kits etc can they realistically provide and break even never mind turn a profit. Yes the cuts are sad and everyone at vs would like to offer more (honestly) but we would have to charge more. The market is totally price sensitive and therefore until the US govt stop propping up bankrupt airlines this is never going to happen. Is it really the end of the world to pay for some crisps to eat in the middle of the flight if you want a snack? At the end of the day nobody wants to pay higher fares but the government keep putting up taxes so something has to give. If vs went down nobody would save us!

I must disagree - I do not see the market so totally price sensitive.
As you say 30 actual cost - that immediately raises the question: How much better could it be for double that amount?
And how many routes would be adversely affected by an increase of just 30?

And what about PE & UC - it is nowhere near 30 here - but what do these customers get for that extra?

Take the MCO B&S routes - they are at high capacity even at this time of year even though they are by no means the cheapest offering. Passengers are showing they are willing to pay more for that Virgin service - at the moment!

But how long will that last after pax experience a severe deterioration in that service that they have (in their minds) paid extra to receive?
Will they come back next year?
That is the major problem - it is not this years figures that take the hit - it is next - and the years after that.
VS have built up a great reputation over a number of years - but it only takes a few bad trips to destroy that reputation.

PE & UC would be expected to be the most sensitive to poor service - they are paying very much more than 30!
So it is very reasonable for them to object when the service is not a great improvement over Y.
At the same time the PE & UC seats are still selling - particularly on the B&S routes!
This would seem to indicate that many pax are willing to pay for that extra - but how much of that is based on the past VS reputation? - and the belief that they will get that extra service?

If you lose the UC & PE reputation, could VS survive on Y pax alone?

quote:Originally posted by JoeyVS
After tax they are getting about 30 quid for taking someone to NYC how much free food, drink, movies, headsets, amenity kits etc can they realisticly provide and break even never mind turn a profit.


I disagree as well, for two reasons:

1. The fuel surcharge is still extremely high with no sign of coming down - does this really cover just fuel?? This is included in all the taxes.

2. I travel during school holidays so pay well over 30 before taxes. I would even say that flights during late July/August are higher than they have ever been. If I pay more than 30, should I expect a better product?

I'll probably be shot down over both points but they are major gripes of mine!!

quote:Originally posted by Neil
I'm not disputing what you are saying Dave but whilst the load numbers are still very good, which has been reported numerous times. Even the crew are saying how full both PE and UC have been lately and VS are continually doing well in all the travel awards the bean counters are not going to change their ways.

So are we all wrong? Are VS being very clever? I really don't know!


VS have filled UC (and PE with low) cost fares - they should have more J and D seats in Upper to make their profit rather than using Z to just break even and restrickt G even further IMHO.

HG

quote:Originally posted by centurionman
If I were flying in Y, I would never consider flying with VS period.


100% agree, I'd even consider a charter now, looking at some of what they offer. But that's easy for me, I haven't travelled Y for ten years or more.

quote:Originally posted by joeyvs
After tax they are getting about 30 quid for taking someone to NYC how much free food, drink, movies, headsets, amenity kits etc can they realisticly provide and break even never mind turn a profit.


I have some empathy with this argument, US yo Heathrow prices are just ridiculous but do at least prove the argument that competition lowers fares - they are, I believe, lower than any other European hub to the US. But here's two things:

(1) that's a cheap seat in Y, when I pay 1,900 short notice for a PE seat to JFK I think what a rip off it is - and this is steadily going up, something like 300 in the last year for a W fare which tells me
(2) VS can and does raise fares while cutting service, not just keeps & fares ridiculously low while cutting service - so it has a choice and some of that is within its own control, how much does VS actually force the yield down ...

quote:Originally posted by Mont25
2. I travel during school holidays so pay well over 30 before taxes. I would even say that flights during late July/August are higher than they have ever been. If I pay more than 30, should I expect a better product?


Not shot down at all, it's a valid point, your service is effectively being priced at the 30 level but you're charged a heck of lot more ...

[Neil]

quote:Originally posted by hackneyguy

VS have filled UC (and PE with low) cost fares - they should have more J and D seats in Upper to make their profit rather than using Z to just break even and restrickt G even further IMHO.

HG


The problem with doing that is that VS would then be pricing themselves out of the market. If BA are offering Club at 1700 but VS are suddenly say 2500 they are going to lose pax to their rivals. Surely it is better to have a full UC with a higher % on Z fares, then a cabin only a third full on J & D fares?

Also, if VS restrict G (or any reward fares) even more so, then they would only come under criticism from many, including on this forum, for making the FF program not worthwhile, which is already an issue for companion vouchers. It could and would push pax to other airlines, who have a greater possibility of using rewards, something, which you might not like, but has become a major factor for all pax & airlines.

Just on these 2 points alone, we have different opinions, so multiply it by the whole customer base, on all the issues, whatever VS do, and I'm not saying what they are doing currently is right, they won't please everyone, or even the majority.

[Neil]

quote:Originally posted by slinky09
quote:Originally posted by centurionman
If I were flying in Y, I would never consider flying with VS period.


100% agree, I'd even consider a charter now, looking at some of what they offer.



I 100% disagree. Having taken a VS Y flight last year, and on the 'old/rubbish/poor old MAN/LGW' fleet it was fine and much better than my previous Y flight with Thomsonfly the year before. Yes, VS may not be miles ahead in terms of what is actually offered now, but compared to the charters who charge for everything from sitting together, drinks & food, a half decent baggage allowance, I would and actually am considering VS Y for a flight next year.

Neil

quote:Originally posted by Neil
If BA are offering Club at 1700 but VS are suddenly say 2500 they are going to lose pax to their rivals. .


What I was trying to say is yes have lower Z fares, like BA, but a lower proportion of, like BA. I believe VS could, and should, sell more J and D fares and still offer cheap restrictive Z and G but at a lesser proportion of the whole. Believe me there are times I can not get a J with VS these days but plenty available on BA route so I think the demand is there - and with that extra revenue plough it back into enhancing their product.

But as you say we hold differing views, both as valid, but just to think of how many other views are out there is bewildering.

I just remember one V-FLyer telling me when I first joined that UC was a 'premium J Product'. that was less than two years ago and I wonder if he still says that in Nov 2009 !

HG

quote:Originally posted by hackneyguy
sell more J and D fares and still offer cheap restrictive Z and G but at a lesser proportion of the whole

I just remember one V-FLyer telling me when I first joined that UC was a 'premium J Product'


A possible extension of this is then to offer a different UC experience depending on booking class, it already happens (CDCs) and could easily be extended (e.g. free spa bookings, sectioning the UC cabin and providing a tiered service ... [:w]). But as to finding it difficult to find Js on VS, that's an odd one that I don't see myself - in any case, VS will overbook if lots of Js but very, very infrequently do I find that my preferred flight is not available when booking (SFO sometimes, especially during busy conference season).

On your second point, I'm reminded of the US advertising for UC: first class service at a business class price (sic.) [?]

I'm going to put a slightly different slant on this. I'm 24 years old, and have been travelling independently (sans parents) for about 5 years. Prior to that we annually went on long haul trips. In that time I've flown with a few carriers, including the frankly awful United and Delta, all in economy.

When I met my girlfriend, her father is a VS Gold Card holder who flew/flys Upper Class several times per year. He was pretty convinced by the Virgin service.

My first Virgin flight was in 2007 to Las Vegas and back from LAX, again in economy, and to be honest I've not really looked back since. We flew PE for the first time last month and were again impressed, and have our first UC trip coming up in April.

We find Virgin reliable, willing to go the extra mile for their customers, and most importantly of all we trust them. I can't say we'd approach flight with anyone else (other than perhaps Air NZ and Singapore Airlines) with the same enthusiasm.

quote:Originally posted by slinky09
[But as to finding it difficult to find Js on VS, that's an odd one that I don't see myself - in any case, VS will overbook if lots of Js but very, very infrequently do I find that my preferred flight is not available when booking (SFO sometimes, especially during busy conference season).



I was trying very hard to get to Zimbabwe a couple times next year to visit friends (not during some sporting event either) and there was no availablity to either JNB or CPT on the dates I had to go (I cant be flexible but for work related reasons have to purchase a fully flexible ticket incase I have to get back to the office - my assumption is that they have sold lots of bums on seats in recent Z sale). BA came to the rescue and going in F as they now give free connecting flights in J (Comair) so worked out cheaper in the long run - a real no brainer but shame on VS on missing out on two J flights.
HG

quote:Originally posted by slinky09

100% agree, I'd even consider a charter now, looking at some of what they offer. But that's easy for me, I haven't travelled Y for ten years or more.


Interesting. My holiday in Grenada next April is also available via charter, Monarch, as well as by VH/VS. Same everything except Monarch fly Wednesdays out of Gatwick, VS Thursdays.

The price difference was initially significant, the total cost of the holiday with Monarch (in their premium cabin) was 600 cheaper than flying PE with VH/VS. I didn't book Monarch, however I didn't book VH/VS either.

As I hoped, prices have now changed on VH/VS to reduce the difference to c200. As a result our holiday is now booked with VH/VS.

If the difference had remained 600 (that is a lot of Morrisons Bollinger!) I cannot say what I would have done.

At 200 extra (ie 50 per person per flight) I get the 747 and the bubble so I am a happy bunny.

As a newbie to Virgin, I obviously don't have the issues about services lost which some posting here do. My basic requirement is to arrive safe and sound and I will endeavour to cope with whatever other trials and tribulations arise. I will cope with iffy food and dodgy entertainment systems, just as long as there is plenty of vino. I do like cleanliness however, planes and people!

PS Is it not possible, because of the relationships with VS that some eminent members of this forum must have, to get a senior VS bod on here to explain/justify their thinking re customer services.