That’s the opening statement from an Amtrak commercial that I saw last night (at least it was new to me). As a consumer of travel it’s a sentiment that resonated with me very strongly. Pretty well executed ad overall, although the point about the ‘shoes’ is probably too veiled a reference to TSA security for the average viewer to catch. But moving right along.
As a participant in the travel industry I understand the movement towards unbundling of products and the opportunity for ancillary revenues to drive profitability that the ad directly references. If I was cynical (oh, wait I am) I might say that it’s easy for Amtrak to make these claims and offer ‘free’ services because they are receiving government funds to stay afloat.
However JetBlue and Southwest also follow the Amtrak philosophy and are among the most profitable and highest rated US airlines. So the correlation between ancillary revenues and success isn’t necessarily as high as some would like us to believe. Sometimes I think that the airlines have lost sight of the customer as they focus on expanding revenue streams.
As I wrote earlier this year in Tnooz, the best path to creating higher margins is to deliver an experience that the customer enjoys and you can earn real loyalty that isn’t driven by providing the lowest cost or through constant promotions. Whether that experience is created by software, services or amenities isn’t the point.