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As business owners, we often make decisions that at first blush serve the business well. But, as things roll out, there are consequences that we didn't anticipate and don't want.
The airlines are living this out as we speak. A while ago, to boost themselves out of the red, most major airlines instituted bag fees. A passenger must now pay an additional $25-$35 per checked piece of luggage.
I'm sure that when the airline executives came up with this plan — they were elated. I can envision the equation on a big white board somewhere. X million bags times $25 = a TON of money.
But what they didn't think through was the consumer's reaction. At the same time they were trying to boost their bottom line, so were traveling families and business people. So rather than pay the $25 fee, people simply ignored the carry on bag size regulations and more and more people bypassed the checked luggage option.
The baggage fee has generated income ($2.2 billion for the industry combined in 2009) but it has also created these headaches:
- Longer lines in security as people take more through the check point (and have no idea how to manage it all)
- A jam up in plane boarding (everyone wants to get on early in hopes of snagging some overhead bin space)
- Adding significant staff time in gate checking many, many more bags
- Disgruntled customers who are now being forced to gate check bags with computers and other valuables that they thought they could carry on
- More broken overhead bins due to people shoving bags that are too large into them
- Delayed flights because people board with bags that won't fit — and have to swim upstream to the front of the plane to do a late gate check
- Increased dissatisfaction ratings from frustrated fliers
Maybe the money is worth it… but imagine the brand position some airline could take by renouncing fees and putting some of the convenience and comfort back into flying.
Bigger picture for us — we need to think past the first blush advantages. Ask yourself these questions before you make a major shift in how you do business:
- How might our customers act differently, based on this change? What are the consequences to those shifts?
- How might this change the way we are perceived by our customers? By our employees?
- What hidden costs come along with this decision?
What do you think — if they would be candid, would airline executives tell you that baggage fees are worth the extra hassle, staffing, and customer dissatisfaction?
