Ryanair Booking Deal Targets Business Boost as Makeover Ramps Up
Ryanair Holdings Plc (RYA) aims to double business traffic in two years after partnering with global booking system Travelport Ltd. to reach a broader customer base.
The deal with Atlanta-based Travelport will help drive Ryanair’s corporate passenger total to about 36 million from 18 million, Chief Marketing Officer Kenny Jacobs said today.
The multi-year deal is the first of its kind signed by Europe’s No. 1 discount carrier in a decade and aids Chief Executive Officer Michael O’Leary’s push to boost customer appeal, Jacobs said. Dublin-based Ryanair will also roll out enhancements including a new website, mobile boarding passes and a smart-phone app over the coming three months to help streamline the booking and travel process.
“We’ve made really good progress on listening to customers and saying, ‘what would you like us to change?’ And they’ve told us,” Jacobs said in an interview in London. “We’re coming from a stripped-back point of view and then you can pick and choose what you want to put on top.”
Refinements adopted so far include the introduction of allocated seating, a relaxation of the carry-on allowance, reduced baggage charges and a dimmed cabin and fewer announcements during early morning and late evening flights.
The emphasis on responding to customers will remain a priority, with the airline using Twitter and cabin crew to gather feedback, Jacobs said.
Ryanair will spend about 35 million euros ($48 million) this year on advertising and digital promotions, a tripling of the marketing budget, as it seeks to refine its discount image.
The ramp up signals a shift for O’Leary, who once prided himself on using press coverage of outlandish publicity stunts to grab passenger attention. While the executive will remain core to the Ryanair image, the carrier will seek to use other forms of marketing to bolster the brand, Jacobs said.
“He’s a force of nature and that’s a great asset to have and use in the right way,” Jacobs said. “As we move forward we’ll be taking a more balanced approach, looking at all the marketing levers we have and not just public relations.”
Competition among European discount carriers is set to intensify, with U.K.-based EasyJet Plc (EZJ) adding planes and smaller players such as Vueling Airlines SA and Monarch Airlines Ltd. growing in relevance, HSBC analysts said in January.
The agreement with Travelport, which is owned by buyout firm Blackstone Group LP (BX) and also works with EasyJet and Air-France-KLM Group discount unit Transavia, does not preclude deals with other global distribution providers such as Amadeus IT Holding SA (AMS) and Sabre Inc., Jacobs said.
Discount carriers have traditionally shied away from working with global distribution partners out of concern the agreements will add complexity to their booking processes.
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