Ryanair voted least favorite airline for third year running

INTRODUCTION

1. Reference to the article and outcomes of the assignment

Ryanair is voted least favourite airline by UK passengers for third year running according to a TripAdvisor poll. 30 % of 450 Brits questioned voted the low-cost airline as their least favourite airline. (Fearis, Bev, 2008)

The author chose this topic because he has often flown with this airline company and does not agree with the results of the TripAdvisor poll which leads to the assignment question:

What are the reasons that Ryanair is voted least favourite airline and how can these reasons be solved?

The outcomes of this assignment will be to analyse the reasons wherefore Ryanair is vo- ted least favourite airline and the differences of this airline to other low-cost and regular airlines. Furthermore the outcome will be to find appropriate solutions on how Ryanair can solve their unpopularity among their passengers and research how these solutions can be implementend.

Methodology

The author researched on the internet for current articles on Ryanair in terms of customer satisfaction. He put emphasis on quantitative sources, such as internet forums which are mainly about airline reviews as well as qualitative sources, such as the Ryanair website and secondary data, such as documents already published from independent institutions. To prove the validity of data, the author used triangulation to prove the reliability of sources. Furthermore, when the author analysed the topic in more detail, he found a solution for the issue and applied management techniques which will help to solve the problem of Ryanair in terms of customer satisfaction.

2. Company profile

Ryanair is an Irish airline incorporation with its headquarter in Dublin which operates on 729 routes across Europe and North Africa. This airline is characterized as a low-cost airli- ne and is with a passenger volume of 50 billion per year the third largest European airline. Ryanair was founded in 1985 by Tony Ryan and at that time the airline was operating as an Irish regional carrier. In the following years the airline did not succeed in getting a big- ger market share until Michael O‘Leary started taking the ownership of Ryanair in 1992. Michael O‘Leary introduced the low-cost/no-frills concept and limited the types of aircrafts to a Boeing 737 aircraft and the company discontinued to operate on unprofitable routes. Since then, the airline grew constantly and since the introduction of Ryanair-hubs all over Europe which began with the first low-cost base Dublin in 1992 and the most recent base Bremen in 2007, the passenger volume expended within nine years (1999 to 2008) from 1 to 50 million passengers per year. But not only the low-cost/no-frills concept helped the airline to get a bigger market share, also the deregulation of the European air industry back in 1992 gave EU carriers the opportunity to operate scheduled services between other European states which was at that time a major opportunity for Ryanair.

(Ryanair.com, 2008)

ANALYSIS

3. Ryanair‘s low-cost/no-frills concept

With this major opportunity for Ryanair, the focus turned to the low-cost/no-frills concept. The concept is quite simple, think like a retailer and charge passengers for everything, ex- cept the seat itself. (BusinessWeek, 2006), as a result of this there is no on-board enter- tainment and no pillows and blankets, etc. Ryanair can be booked only through their online booking system on their website or their directory assistance, the implemention of Ryanair in General Distribution Systems (GDS), such as Amadeus, Worldspan, Sabre and others has not been happened up until know as this also involves costs (Mintel Report. Global Distribution Systems). On-board meals, counter check-in as well as handing-in luggage are only for a fee. (Mintel Report. Low Cost Airlines - Europe)

To quote Michael O‘Leary: “ Any fool can sell low airfares and lose money. The difficult bit is to sell the lowest airfares and make profits. If you don ‘ t make profits, you can ‘ t lower your air fares or reward your people or invest in new aircraft or take on the really big airlines like BA and Lufthansa. “ (Ryanair Annual Report, 2001)

Detailed table of low-cost/no-frills concept can be found in

appendix 1

(ryanair.com, 2008)

illustration not visible in this excerpt

4. Why is Ryanair voted least favourite airline?

In regard to the low-cost/no-frills concept mentioned on the first page, a likely reason could be that Ryanair is just focusing on the main point: getting passengers from an origin to any destination by excluding all extra services like on-board entertainment and meals.

“ A S.W.O.T. Analysis is a powerful technique for understanding your Strengths and Weak- nesses, and for looking at the Opportunities and Threats you face “ (Denscombe M, 2007).

To analyze the weaknesses and threats that Ryanair is facing from the customers point of view, the author used a S.W.O.T. analysis.

illustration not visible in this excerpt

(All references mentioned in the bibliography have been used by the author for the S.W.OT. analysis)

During research of the strengths, weaknesses, opportunities and threats of Ryanair, the author found out that there are more negative aspects than positive, eventhough the positive aspects may be stronger than the negative ones. Also the positive aspects are economical ones and the negative aspects are psychological ones. Strenghts and opportunities are mostly low-prices and a wide range of destinations, while weaknesses and threats are in the majority of cases a negative image and an intransparent price system as well as the failure of an implementation of Ryanair in GDS.

So what the author found out here, is that there is a certain balance between positive and negative aspects. In conclusion to that one can say that “ customer satisfaction is in relation to customer expectation “ (Bruhn M, 2007).

If the customer just wants to go to certain destination as cheaply as possible and does not expect and “ luxury“ on board then this customer‘s expectations are fulfilled but if a custo- mer wants a cheap flight and does not care about “ luxury“ it could be different. One indivi- dual does not expect luxury and the other one does not care about it. But “ does not care“ simply means that the customer is not expecting the best on-board service in an airline he ever had but rather a certain professionality and a minimum of service (i.e. shuttle buses to the plane, flight announcements, etc). So these customers‘ expectations won‘t be fulfilled.

“ In 2005 a man with cerebral palsy was charged 17 £ by Ryanair to use a wheelchair. In response to protests over the charge, Ryanair imposed a 50 pence wheelchair levy on e- very passenger ticket. “ (Johnson G, Scholes K, 2008)

More over, there is an immense lack of staff motivation. During research on the internet the author found a forum of an international transport workers‘ federation, where one can read through all the complaints and issues on behalf of mistreating employees on the part of the company which lead to unmotivated staff.

(www.itfglobal.org/campaigns/messageboard.cfm)

In lots of internet forums about customer satisfaction on Ryanair, the author found a wide range of complaints about the airline. Most complaints were service, professionality of employees “ The check-in lady must have had a bad day “ (German airline-review website, Translated, 2008), and the intransparent price structure. Furthermore, lots of complaints are adressing the safety of Ryanairs‘ aircrafts, as travellers may think that this is the first sector where the company will save money.

But between all these complaints there are some saying that the other complaints do exist just because these customers writing them didn‘t know what they had to expect before boarding a Ryanair plane.

“ People who had never flown Ryanair don‘t know what they are talking about “

(German airline-review website, Translated, 2008) Many people try to compare Ryanair with other carrier (low-cost as well as regular airlines). But Ryanair dissociates itself from that. They are clearly pointing out that when flying with Ryanair, “ the customer is paying for the seat itself only “ (ryanair.com, 2008). What the airline does not point out clearly enough is that airport check-in and each bag cost a certain amount of money, what a potential customer of Ryanair would expect to be included in the ticket price.

[...]