How many times have we heard this story before? Delta decides to make a run at growing its presence in LA every few years, and the results are always the same. It ends in retreat. But this time, Delta is doing things differently, and I wouldn’t be surprised if the end result was different as well.
Usually when you think about an airline trying to make a big push in a market, you think about adding new flights. That’s certainly what Delta has tried before. It bought Western Airlines in the 1980s and ended up shrinking. More recently, it has tried two separate build-ups in LA and none have ended well. Delta now finds itself well-behind American and United in LA, but instead of challenging that dominance, Delta is looking at how to improve what it already has so that it can attract more high-yield business travelers on to its airplanes.
Oh sure, there have been new flights added, but they’ve been more opportunistic than anything else. Things like the daily winter flight to Jackson Hole and summer service to Anchorage and Bozeman are more about filling a need. Those kind of flights aren’t going to appeal to the business traveler. Even the growth in business markets won’t have the frequency needed to matter (a daily summer flight to Boston, 3 to Seattle….) This is just filling out the schedule where there’s opportunity and nothing more.
That’s not to say that scheduling moves haven’t made a difference in business markets, but it’s not about adding a ton of capacity. The most obvious example is the introduction of a Delta Shuttle operation between LA and San Francisco. Flights will depart hourly and there will be the same types of amenities you see on the east coast Shuttle… free newspapers, snacks, drinks, etc. But the real benefit is that there are dedicated check-in counters that require arriving only 30 minutes before departure and close-in gates to make things move quickly.
The funny thing about the Shuttle is that it didn’t require much of a capacity change. Delta had already built up a ton of flights in the market, but now the airline just makes sure they depart at the top of the hour. It’s about trying to use the schedule more wisely, but even more than that, it’s about investing in creating a product that appeals to travelers.
This isn’t the only example of Delta building a product. It’s also focusing on another important business market, JFK, by bringing the level of service up to an international standard. That includes putting flat beds in business class. I still remain skeptical of the need for those beds, but certainly travelers aren’t going to complain. There are also a host of other onboard improvements just on the JFK route.
Even on smaller routes, Delta has decided to only use airplanes with First Class and wifi. There are no 50-seat or smaller aircraft in the Delta LA operation, yet American and United have a ton of those uncomfortable, all-coach airplanes.
Naturally, Delta is making these moves in markets where high value customers will take notice. And to help get those people on the airplane, Delta is trying to woo them with flash on the ground as well. In Atlanta, Delta uses a surprise-and-delight tactic with its best travelers by meeting them at the gate with a Porsche instead of making them head through the terminal on their own. (Oh, the horror…) That Porsche operation is now coming to LAX as well.
So Delta is putting a lot into the product, but that’s not enough. Now it has to actually get people’s attention and try to build a buzz around all these moves. Last week, I was invited to a party up in an enormous house in Beverly Hills. While I didn’t attend, I know there were a lot of folks who did. If someone told you an airline was throwing this kind of event, you’d probably guess it was Virgin America. But this was indeed Delta.
Of course, it’s not all about flashy parties. Delta is spending time with local customer groups and I get the feeling it’s sharpening its sales team in LA to try to make that push.
This is most definitely not your traditional play to win a market. And that’s why it may very well have a chance to succeed. While I remain far from convinced that the Shuttle to San Francisco and flat beds to New York are going to make a difference, Delta has finally started making the kind of decent profits that allow it to take these chances. I like the willingness to try new things. Hopefully we’ll see some of them stick.