We already know that JetBlue will be rolling out a new premium cabin on flights between JFK and both LA and San Francisco, but as of yesterday we now know a lot more, including that it will be called Mint. The newly-revealed product details seem pretty nice, and they will certainly attract fliers on those routes, but I still have to wonder if this whole thing is a good idea. As of today, it only impacts two routes. Will it just be a distraction?
Disclaimer: I am a member of the airline’s “New Onboard Experience Advisory Board,” but I was not able to attend the only scheduled meeting that presumably would have discussed these changes.
To summarize what we already knew, JetBlue decided to roll out a premium cabin on flights between JFK and both LA and San Francisco in order to try to capture some of that lucrative market. The premium cabin would only be available on a handful of airplanes, those that would be dedicated to these routes exclusively. We heard a lot about the hard product before. There would be 16 flat beds, 4 of them in private suites with doors. But what we didn’t know was more about the soft product as well as the branding and pricing.
Now we know it’ll be called Mint. I think the goal with that name is to capture the clean, cool, refreshing feeling that Air Canada tapped into with its light, minty-green airplanes. I actually don’t mind it, except that all I can think of is that weed-like plant that has taken over my backyard. (Seriously. If you’re thinking about planting mint, don’t do it. You will regret it.)
If you fly in Mint, you’ll get super-cool food from a super-cool New York eatery (Saxon + Parole) and super-cool amenity kits from a super-cool retailer (Birchbox). It’s a little fluffy but it certainly builds on that, um, super-cool vibe that JetBlue used to have until Virgin America took it over with its purple lighting.
And then there’s the price. It’s (relatively) cheap. Right now, it’s on sale for June 15 – 18 for only $499 each way. When the summer schedule opens up in November, it will be offered starting at $599 each way. That’s great, but then again, when Virgin America launched service in 2007, it had intro First Class fares of $389 one way. Today the lowest First Class fare on Virgin America is just over $2,000 one way. Crazy, right? So JetBlue will have a sizeable pricing advantage until everyone else decides to jump in and fight.
And you know the fare war is bound to come. JetBlue’s marketing boss Marty St George told USA Today, “We’re aiming at that first-level elite customer on American or Delta … who never gets to upgrade.” That may be the case, but many of those people trying to upgrade work for companies that don’t allow you to buy a ticket up front. We’ll see if this pans out.
JetBlue has said that it sees people fly the airline regularly but then they leave to fly an airline with a better product when they head from New York the west coast. Getting those people back might be bad news for Virgin America. The New York-based traveler who isn’t bound by the shackles of elite status may very well be turning to Virgin America today. That’s going to change with JetBlue in the market. In San Francisco, Virgin America has at least built some higher levels of loyalty but I would think it’s still at risk with such a large pricing difference. The legacy carriers may be JetBlue’s target, and I imagine they will just tap into their frequent flier bases and offer promos to prevent people from fleeing. It should bring fares down at the very least.
Will this work? It depends on the goal. It will undoubtedly help JetBlue raise revenues on those two routes. After all, with the lowest nonstop fares today in the premium cabin starting at $2,000 one way, the fare canopy is extremely high. And as we’ve always seen, when opportunities present themselves, others will step in and take advantage.
But I do worry that this will be a huge distraction for the airline. We’re only talking about two routes here. While it’s possible the Mint brand could be used on a different kind of premium cabin elsewhere in the system, I can’t imagine JetBlue has many routes that can support 16 fully flat beds. So the airline is creating this big campaign for two (admittedly very lucrative) routes. Will this take their eyes off the all important “core experience” as they call it?
I’m particularly sensitive to this since I came into United at a time when Ted was growing. So much attention was paid to the Ted brand that the important part of the airline (that part that starts with U-N-I) went ignored. Then again, I thought p.s. was a great idea and that served these exact markets. Still, that kind of focus on such a small piece of the airline simply can’t happen here with JetBlue. The airline seems to know that. CEO Dave Barger had this to say in the USA Today article.
“…as we put forward a premium experience, it can’t be at the expense of our current customer. … And I think that’s what’s going to be really different from what we’re seeing across the rest of the industry.’
Of course, it’s much easier said than done but the attitude is right. Let’s see if they can follow through.
[Original US Mint photo via Shutterstock]
JetBlue always seems to do just enough for everyone to be focused on the new, flashy thing that they’re doing rather than the fact that they are running an airline that barely breaks even. This will buy them another year or two of smoke and mirrors.
Ah yes, the “Jetblue is doing it with smoke and mirrors, reality is going to strike in a couple of years” argument people have been spouting since 2000. And yet here they still are.
Not saying they’re going anywhere…they just haven’t returned shareholder value recently, and the shareholders really haven’t gotten upset about that yet because of all these distractions. Like it or not, the facts are that B6 has not produced a margin above 4.3% in the last 5 years.
Fair enough. I don’t know that I’d call them distractions per se, I see it more as moves to differentiate themselves from other airlines. The way things are shaping up right now in the industry, there are the legacy carriers and the ULCC’s. Jetblue (and I guess Virgin America) don’t really fit in either category so they need to make moves to ensure survivability. I’m not 100% sure this premium offering is the way to go but at the same time it’s a market segment that could pay off big if it works out.
You’re thinking of Virgin America, aren’t you?
No then I would have said “never breaks even” instead of “barely breaks even”. :-)
First I just have to say ‘Mint’ is a dumb name. Could be a PR blunder as aircraft age and get normal wear and tear dings. People will start saying the planes not in ‘Mint’ condition.
With only a few planes decked out in ‘Mint’ condition they will have to use them in other markets to keep them in the air, or just have them sitting around on the ground. The transcon market with its time difference doesn’t permit keeping planes flying back and forth at ideal times so sitting around on the ground or being used in other markets until needed on the transcon routes will need to be done. Which will B6 be doing?
Is United flying the p.s. planes on other routes on a regular basis? I thought not.
You’d have to ask the same question about the route-specific aircraft being used by American (A321 transcon) United p.s. and Delta that are used solely on the same exact routes. The time difference you note also allows for red-eye ops, which would help maintain a high utilization rate.
Round trip is aprox. 12 hours of slot time + 4 hours of ground handling (2 at each end). You’re only loosing on one half rotation, if … you’re not using it for a redeye, which is possible on those 2 routes.
So one plane equals to only 1.5 rotation a day, and therefore, the fleet to deal with 8+ flights / day on those 2 routes is not that small !
i would imagine these are to be used for the redeyes (that’s when i would WANT to pay extra to sleep) so i don’t think they are losing any service time.
p.s aircraft do not go on other routes. American aircraft do today with some Miami segments in there on occasion. The new A321s probably won’t fly any other route, though we’ll see how long that configuration lasts. Delta does not dedicate aircraft but just rotates international airplanes into the rotation.
I would expect that JetBlue wouldn’t use these on any other routes, but I don’t have any inside info on that.
Once Delta reconfigured the transcon 757 with the layflat seats, it’ll have a dedicated fleet for the transcon routes.
ptahcha – That’s not my understanding. My understanding is that while they will fly primarily on those routes, they will also be able to continue on to near-Europe destinations. So they have flexibility in how they run the fleet.
Is it called “evolving” when an airline substantially changes their business model, or is it “losing their way” from what made them successful in the first place. How many airlines have evolved their way into success or away from failure? vs. how many who have stayed true to their successful course and remained successful (I think it has to be % count as it seems far more “evolve” than stay the course).
Interesting study for one who likes to do interesting studies: what business approach offers the best chance for success: evolve or stay the course?
John – I think you have to evolve or you fail. There are plenty of examples of that. The question is – what is the right kind of evolution? That’s hard to know until after the fact.
Couple of points that i think deserve a bit more thought.
First, you wonder if this will “take their eyes off the all important core experience?
Easy answer is no, did you read the part about the improved core experience?
larger screens, 100 channels, in-seat power, fast Wifi!
Secondly, you mention that Virigin is charging $2000 and how that gives JetBlue a sizeable pricing advantage. I think thats an understatement given the fact that the Virigin product is inferior. There is a pricing advantage even if they charge the same as its a better product.
looking forward to flying on one of those!
Mke – What they say today does not guarantee that they’ll keep their eyes focused on the core. They have started off saying the right things, but we have to see if it’ll continue. I hope it does.
The core experience just lost 1″ seat pitch on these planes if I’m not mistaken (34″ to 33″), and maybe just not only on these planes. Still more than the legacy carriers but less. People are paying attention to these seats and ignoring the mainstream reduction. Pretty shrewd of JetBlue.
Sure they lost an inch of seat pitch, but with the use of slimline seats the legroom is the same.
A few non-industry blogs caught onto that fact (Gothamist is one that comes to mind) and spun the story as Jetblue turning away from their egalitarian business model. The 1″ loss in space gets lost among the “improved amenities” (nicer coach seats, wifi, more TV) so in the end the average customer won’t really notice it.
33 is a helluva lot more pitch than any legacies, WN or anybody else gives you in coach… without paying extra.
Jonathan – Yes, the new A321s will lose an inch of pitch, but these are completely different seats so pitch change doesn’t mean much. Ben G – I believe the legroom is actually even supposed to be better despite the inch less pitch.
Of course, 33 inch pitch with a regular seat is still the best in the industry.
The in-flight experience promised by JetBlue seems promising. I hope Mint comes with increased staff training to problem solve. Will FA clean the bathrooms if visibly dirty? Communicate with non-English speakers with a phone translation service? Will empty seats be allocated to military personnel or charity organizations? The premium passenger on those profitable routes expects separate check-in, lounge access, express security screenings and quick re-routing if delays/cancellations happen. Will JetBlue place Mint passengers in other carriers to ensure them arriving on time? Finally, AA will have almost hourly service with A321 metal JFK-LAX. How do you sell a product that has less frequency/convenience? Inquiring minds want to know.
“how will they sell it” without the frequency and network of the dwindling number of legacies? I think that’s clear; they will sell a similar (if not better) product for $599 one way which represents (roughly) a 75% discount.
Why stop with military personnel and charity organizations? How about fire fighters? Police officers? Teachers? Social Workers? University professors? Retired people on fixed incomes?
Jay – Frequency matters less the longer the flight. If the US/AA merger goes through, we’ll never see that hourly shuttle, but others will definitely have an advantage over JetBlue on frequency regardless. I don’t think JetBlue needs to match the legacies but it does need to build out a schedule that covers the day better than it does now. I’d be we see that happen in the summer schedule, if JetBlue is smart. (This is the same thing I’ve hounded Virgin America on for years. You need a competitive schedule, but it doesn’t have to match exactly.)
One of the key bits that I caught from the press release is that JetBlue will only be selling Mint seats, not upgrading people into that cabin. That’ll go a long way toward preserving the integrity of their pricing.
I wonder if they will end up in the Virgin problem. That is, the fare is $2000 so no one buys it because at check-in, the upgrade is offered for $200-500. Thus, most people in F are not paying the $2000, but closer to $700. Will 16 seats be too much for Jetblue?
Perhaps that isn’t VX’s problem, but just how they do revenue management?
Well, with all this mint in your backyard, you have a constant fresh supply for mojitos ! So it’s not all bad …
Is the graphic from JetBlue?
I wonder what David Neeleman thinks of the changes at JetBlue –
PF – No, that’s an old US Mint sign.
I’d like to try JB’s new Mint product, but the connections are nuts. Mt transcon route is PDX-BOS and JB already non-stop service to BOS from SEA. I’d have to position from PDX to SFO and then again from JFK to BOS. I’m thinking, but I don’t think it is worth the trouble. In fact, there is yet another link to consider because EUG is really a better starting point. There is service from EUG to SFO, but the schedules in both directions. and on all available carriers are less than ideal. I’ve made the EUG-SFO trip several times and yup, some of them are still turbo-props. That kind of ride as the first link in a long trip really CAN ruin your day. In the end, second there third tier cities and airports just don’t have the traffic volume to support good service and good airplanes. And of course, even with multiple carriers serving the EGU-SFO route, the prices are still abusive.