I am writing this from a half empty ( or as JetBlue called it half full) JetBlue flight. Even in a half-empty flight I am sitting in a row that is fully occupied. Right in front are two completely empty rows of seats. When people asked to move to those rows we were told politely, “those are ‘Even More Space‘ rows. You need to pay to upgrade to those”.
Common reaction, including my own is, but but these are empty. ‘Even More Space’ is JetBlue’s offering to its customers with higher willingness to spend. These seats have more legroom and also have power outlets to charge your devices. In other words, these are price realization levers that allows them to capture additional value from customers. That is, “Even More Value Share”.
Don’t think for a second I would say price realization is wrong, I am all for better price realization and for offering premium products at premium prices that customers would self-select themselves to. But I can’t be rational all the time, can I? Especially as a customer?
We wouldn’t ask to move to first class if we see empty seats. It is either due to the clear separation, what we know about premium service it offers or social training. But when you see the identical seats right in the midst of all other seats with no visible advantage over other rows, we will think this is ridiculous to ask us to pay to move one row ahead within coach.
If you are one of those sitting in the rows behind the empty Even More Space row you likely will think about the zero additional cost to JetBlue to allow you to move ahead.
About five years ago when Andrew Hyde from Boulder was upset with Frontier Airlines charging him extra to go standby on earlier flight even though the flight had empty seats. So Andrew created a website frontierfail website and started writing strongly about Frontier’s bad pricing practice.
Like most people looking at pricing as cost driven, his case was around the marginal cost to Frontier to accommodate him on a empty seat and the disconnect with the price they wanted to charge. Whether there is true and measurable marginal cost to carrying one more passenger or most of it is fixed cost, I do not know.
I then wrote why the cost does not matter and what it’s Frontier’s model for not allowing free standbys. I am not changing my position because I am at the receiving end. Yes the cost does not matter. In the case of Even More Space the marginal cost is $0. But the problem is there is no upside to JetBlue with this price fence.
The bigger problem is, those seats are empty – they already lost on monetizing those passenger miles. That is a bigger revenue loss. Trying to stem that loss by capturing upgrade charge is valiant attempt but ineffective. First the customers do not see clear value and second even if they did, it has no price in their mind because they see it as fairness issue ( why should I pay you for something that I know costs you nothing and you are not able to sell?).
It is a different matter in a full flight and when JetBlue offers upgrade at checkin time. Customers can see value and may self select themselves. If they did not then JetBlue has no option but to start releasing those seats at no extra charge to ticketed passengers. And indeed in past toe occasions in last two months I did get that benefit ( and I did not bother writing about that of course).
So the better option for JetBlue for a half-empty flight is to follow the same procedure in a full flight with no takers and allow customers to switch. At least you won’t create displeasure ( and no I am not going to start JetBlueFail like Andrew Hyde did. I love JetBlue. Even it’s regular seats are more spacious than most. Besides their Terra Blue chips are very good).
As I wrote previously about how airlines are moving away from service reductions and restrictions to value delivery and value capture, JetBlue should avoid restrictions if they lost the opportunity to monetize the value before the flight takes off. After that the value has expired and hence it’s price.
Final note: Given that I was woken up twice in the middle of 6 hour flight in the night by two young ladies wanting to use the bathroom I feel like now I should have upgraded to the empty row.