RIC ? Southwest

Discount airline Southwest is the new belle of the ball in Richmond.

Last week the Richmond airport and the Greater Richmond Chamber of Commerce rolled out the red carpet and announced a $600,000 marketing campaign to help promote the value of low-cost carriers AirTran and JetBlue.

Even with “Save Low Fares,” as the campaign is being called, Southwest didn’t get a lot of mention as the plan was unveiled. That’s because Southwest doesn’t fly out of Richmond.

But Kim Scheeler, president and CEO of the Greater Richmond Chamber of Commerce, said one of the main drivers behind the campaign is to lure Southwest.

“Part of what’s driving this is Southwest merging with AirTran,” said Scheeler. “Southwest is one of the airlines that a lot of markets go after and will try to throw money at them.”

Southwest announced at the end of September that it wanted to buy Atlanta-based AirTran, which flies out of Richmond. Southwest does not fly out of Richmond and will likely assess the value of keeping planes at RIC post-merger. That has local airport officials pouring on the charm.

It’s all part of getting a share of the “Southwest effect.” The airport commission and Chamber’s campaign has even devoted a whole webpage to it. “When Southwest enters a new market, there is a decrease in airfares and increase in air travel,” the page explains.

Although Southwest’s acquisition of AirTran is still pending, the local business boosters want to be ready. Southwest already flies from Norfolk, and AirTran flies from the Newport News airport.

“Part of this is – let’s get ready for when that day gets here,” Scheeler said. “Southwest is going to bring a more expansive network and more equipment. The more we can get those numbers up, the more likely that when Southwest comes here we can have a conversation with them.”

The numbers to which Scheeler is referring are the claims that AirTran and JetBlue, the two low-cost airlines serving Richmond, are losing market share because of declining business locally.

Some local business people are wondering why the discount airlines can’t just out-compete the legacy airlines and why the Chamber or Airport needs to get involved in the airline marketplace.

Scheeler said that legacy airlines are competing on price with the low-cost carriers to maintain market share, even if it means losing money for a while.

“The legacy carriers tend to focus on a market strategy and maintaining market share in an area, knowing long term they’ll make it up,” Scheeler said. “The others look at a pricing strategy.”

Schiller said the big boys in Richmond — American, Continental, Delta, United and U.S. Air — often price their fares at a level where they’re losing money locally to maintain market share with the goal of pricing the smaller competition out of the market.

At least part of the problem is also due to the economy and its effects on business travel, Scheeler said. Companies have cut down on business travel, and the Richmond region’s recent loss of some major corporations (Circuit City, LandAmerica, S&K Menswear, Qimonda) have added to the decline.

“The corporate user is more what the airlines are looking for. Companies have cut back more on last-minute travel,” Scheeler said.

Scheeler insists that the Save Low Fares campaign is less about specifically marketing for AirTran and JetBlue and more about educating the public about the effects that low-cost carriers have on pricing.

“They can and they’re certainly going to market for themselves,” Scheeler said. “Our message is a little different than that. It’s an education campaign. It’s not as direct as saying ‘Fly JetBlue’ to wherever.”

Michael Schwartz is a BizSense reporter. Please send news tips to [email protected]

Discount airline Southwest is the new belle of the ball in Richmond.

Last week the Richmond airport and the Greater Richmond Chamber of Commerce rolled out the red carpet and announced a $600,000 marketing campaign to help promote the value of low-cost carriers AirTran and JetBlue.

Even with “Save Low Fares,” as the campaign is being called, Southwest didn’t get a lot of mention as the plan was unveiled. That’s because Southwest doesn’t fly out of Richmond.

But Kim Scheeler, president and CEO of the Greater Richmond Chamber of Commerce, said one of the main drivers behind the campaign is to lure Southwest.

“Part of what’s driving this is Southwest merging with AirTran,” said Scheeler. “Southwest is one of the airlines that a lot of markets go after and will try to throw money at them.”

Southwest announced at the end of September that it wanted to buy Atlanta-based AirTran, which flies out of Richmond. Southwest does not fly out of Richmond and will likely assess the value of keeping planes at RIC post-merger. That has local airport officials pouring on the charm.

It’s all part of getting a share of the “Southwest effect.” The airport commission and Chamber’s campaign has even devoted a whole webpage to it. “When Southwest enters a new market, there is a decrease in airfares and increase in air travel,” the page explains.

Although Southwest’s acquisition of AirTran is still pending, the local business boosters want to be ready. Southwest already flies from Norfolk, and AirTran flies from the Newport News airport.

“Part of this is – let’s get ready for when that day gets here,” Scheeler said. “Southwest is going to bring a more expansive network and more equipment. The more we can get those numbers up, the more likely that when Southwest comes here we can have a conversation with them.”

The numbers to which Scheeler is referring are the claims that AirTran and JetBlue, the two low-cost airlines serving Richmond, are losing market share because of declining business locally.

Some local business people are wondering why the discount airlines can’t just out-compete the legacy airlines and why the Chamber or Airport needs to get involved in the airline marketplace.

Scheeler said that legacy airlines are competing on price with the low-cost carriers to maintain market share, even if it means losing money for a while.

“The legacy carriers tend to focus on a market strategy and maintaining market share in an area, knowing long term they’ll make it up,” Scheeler said. “The others look at a pricing strategy.”

Schiller said the big boys in Richmond — American, Continental, Delta, United and U.S. Air — often price their fares at a level where they’re losing money locally to maintain market share with the goal of pricing the smaller competition out of the market.

At least part of the problem is also due to the economy and its effects on business travel, Scheeler said. Companies have cut down on business travel, and the Richmond region’s recent loss of some major corporations (Circuit City, LandAmerica, S&K Menswear, Qimonda) have added to the decline.

“The corporate user is more what the airlines are looking for. Companies have cut back more on last-minute travel,” Scheeler said.

Scheeler insists that the Save Low Fares campaign is less about specifically marketing for AirTran and JetBlue and more about educating the public about the effects that low-cost carriers have on pricing.

“They can and they’re certainly going to market for themselves,” Scheeler said. “Our message is a little different than that. It’s an education campaign. It’s not as direct as saying ‘Fly JetBlue’ to wherever.”

Michael Schwartz is a BizSense reporter. Please send news tips to [email protected]

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mightycaseymedia
mightycaseymedia
11 years ago

Discount airlines are going thru the same aggregation that bigger carriers are – AirTran and Southwest will be a good culture match, since their attitude toward customer service is lip-only.

Steven Slater aside, Jet Blue has a better flight schedule, more coast-to-coast non-stops (not out of RIC, where the runway is too short for heavies), and since they don’t sell themselves as customer-centric, when their cabin crew is actually pleasant, not just an intercom comedy troupe who couldn’t care less in the aisle…I hope Southwest does take AirTran outta here.

And that Jet Blue brings back the RIC=>LGA flights…

Troy Bell
Troy Bell
11 years ago

For the record, a couple of corrections: 1) Mythbusting “Runway Too Short”: RIC’s RWY 16/34, at 9003′, is adequate for transcon service. 2) JetBlue offered RIC-JFK service from March 2006-October 2010. AirTran offered RIC-LGA service from August 2008-December 2008, when it ran headlong into the recession. Lastly, having flown – on many occasions – the three airlines featured in your post, I observed much more than “lip-only” service. I was made to feel as though my business was valued, my flights have regularly been on time (and when they weren’t, updates were timely and informative), my checked luggage arrived when… Read more »

David McIntosh
David McIntosh
11 years ago

I’m just glad to learn that Southwest could be coming to Richmond. Their network will open up destinations I want. They already fly out of Norfolk, so it’d be nice if they were a little closer.

William
William
11 years ago

They’ve landed a 747 (Air Force One) several times at RIC. The Queen of England landed and took off on a British Airways 777 during her visit here a couple of years ago. Casey….You should get your really facts straight before posting on topics that you obviously know nothing about…..

Jon
Jon
11 years ago

I Second William.

Yeah I’ve seen the 747 air force one take off at Richmond on my drive home. Runway is plenty big for heavy jets.

The runway is just a few feet short for the take off of the A380 which needs 9,020 ft or 9500 ft depending on the model.

Also as much as I use airtran, I cannot forget their humble beginnings as Valujet.

http://en.wikipedia.org/wiki/ValuJet_Flight_592

Moral of the story don’t buy a DC 9 from Delta.