I saw yet another article today on ways brands extract revenue from customers with occasionally clever but more often blunt force add-on fees and charges.
Elizabeth Olson of The New York Times illustrates the recent escalation occurring in one particularly brutal category in her story, The rental car squeeze. Being charged $13 a gallon to refill the tank after dropping off your car (yes, this happened in Maryland) may generate a ton of cash in the short term but it can't help your brand. Not surprisingly, the percentage of dissatisfied travelers has nearly doubled from 12% to 21% in the last six years according to J. D. Power and Associates' annual Car Rental Experiences survey.
This is not big news to anyone who has rented a car in the last six years. What is newsworthy is the inability of any brand to leverage the brewing customer revulsion. Twenty one percent of the market represents a ripe opportunity. A tactic like Guaranteed, out the door pricing at the time of booking would be a game changer. It could also help reverse an increasingly adversarial relationship with at least one car rental brand. Does this sound risky? Fortunately, a very similar approach has succeeded wildly just one floor up from the rental counters.
Southwest Airlines is arguably the sole differentiated brand in the airline category. They have customer loyalty scores that are off the chart. So is their valuation when compared to the competition. Part of the Southwest appeal is their determination to not stick it to customers with add-on fees or similar "gotcha tactics."
It's time for a rental car executive to take the escalator up to ticketing to see how a successful travel category marketer delivers superior value for shareholders by making customer satisfaction (not short-term revenue enhancement) job #1.
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