O’Leary sees no clouds on the horizon with Air Max Shoes Ryanair revamp
“Welcome to the new Ryanair!” the 53 year old chief executive of Europe’s largest discount carrier whoops, greeting the throng of journalists curious to witness his magical metamorphosis from cattle herder to concierge. “If you think this is scary, imagine how I feel, standing here in an expensive London yuppie venue, feeding and watering you lot.”The sleek setting on the banks of the River Thames is a world apart from provincial airports heaving with budget minded Ryanair travellers numbed by a formula the airline has perfected over the years: minimalist service, curt staff, and charges on everything from extra bags to printing a boarding pass at check in (that’ll be 70 a page, please).At the centre of Ryanair Holdings’s ethos stands Mr O’Leary who likes to claim that customers would “crawl across broken glass” for low fares. The concept of glamorous air travel is a romanticised image of a bygone era, he says, with low prices opening the skies to everyone, from drunken UK stag parties infiltrating Poland’s nightlife to migrant plumbers jetting the other way. Then last year, cracks started appearing in Mr O’Leary’s frugal fortress.A wave of negative publicity washed over Ryanair in September when a man was charged 188 to switch flights after his wife and children died in a house fire. While Ryanair apologised, the plight of the grief stricken customer stoked outrage at the perceived coldness of the business model.”Maybe that was a cataclysmic moment,” said John Strickland, a London based director at JLS Consulting Ltd. “They have such an established reputation of being rough and tough that people have that in their minds.”Ryanair was still assured investors’ affection. The stock had gained 40% in the year to August 30, a period when Air France KLM Group, Europe’s biggest carrier, had lost 19%. While short of rival EasyJet’s meteoric 61% gain, Ryanair remained a haven of stability in an industry with historically razor thin margins.Then on September 4, Ryanair said it might miss its annual profit target, a rare blunder for Mr O’Leary that caught markets off guard. Two months later, the carrier predicted its first profit drop in five years, causing the stock to plumm Air Max Shoes et.Suddenly, EasyJet, with its more business friendly model, appeared to have the upper hand. M Air Max Shoes r O’Leary’s macho swagger, by contrast, sounded stilted and out of touch.BEHIND the scenes, Ryanair had already begun plotting its transformation. Software programmers were busy streamlining a website notorious for its clunky booking process, and Mr O’Leary stepped before his investors at the AGM in September with an unusual message: The airline would eliminate irritants, soften its image, and be generally more responsive.A free mobile phone app and twitter feed followed, together with cuts to fees for luggage and the dreaded boarding card printing. The airline appointed a new head of marketing in January, followed a month later by assigned seats, a paradigm shift for an airline previously synonymous with a panicked rush for preferred berths.”The changes that they’ve announced will have an impact, providing it translates into a change in behaviour and a change in service,” said Willie Walsh, CEO of British Airways parent International Consolidated Airlines Group. “When you’re trying to change the culture of an organisation, it does take time and it does take effort.”The image revamp, coupled with new headquarters fitted with a cafe and a slide that would make Silicon Valley startups blush, comes as Ryanair looks to grow passenger numbers by more than a third to about 110m people by 2019, while fending off Luton based EasyJet and a new generation of leaner low cost units at IAG and Deutsche Lufthansa.Success will hinge on convincing previously hesitant customer groups business passengers, people keen to fly to primary airports and older travellers that the new warm and fuzzy Ryanair is more than just a publicity stunt.”We need to create that Ryanair tribe that is really excited about what we do, the money we save, and how we do it,” chief marketing officer Kenny Jacobs said at a company event at the Hospital Club, a members only venue near London’s Covent Garden.Customers have welcomed changes announced so far, with traffic gaining month on month between November and February, Mr O’Leary said at the Design Museum. Load factors for the same period are also up and forward bookings for May, June, and July are about five percentage points ahead, he said. Ryanair has changed its ticket selling model and now makes lower fares available five to six months out. “This is working already,” said Mr O’Leary, kicking off his presentation with a picture of himself hugging a Golden Retriever puppy. “We have returned to being the fastest growing airline in Europe.”Even with all the changes afoot, he can still play the tough guy. Ryanair showed pilots the cold shoulder when some of them voted in a committee in July to demand more transparent contracts, painting them as a privileged caste.”Never since Noah floated the arc has there ever been a shortage of people who get paid about 150,000 to legally fly no more than 900 hours,” Mr O’Leary said.IT IS still likely to take at least two years to alter the perception of Ryanair as cheap and aggressive, possibly longer if Mr O’Leary’s renegade image continues to dominate, says Peter Knapp, global creative director at Landor, a branding agency.”They’ve been so determined to be cheap that the challenge is to find something that they alone can really own and then ultimately find a different way of communicating.”It’s a very distinctive brand because it stands for such a singular message, but it’s going to be very hard.”Ryanair readily admits it has some catching up to do. Spain’s Vueling Airlines, the discount sister unit of Iberia and British Airways, and EasyJet have built flashy websites, service more primary airports and target corporate travel once dominated by network carriers.Under EasyJet CEO Carolyn McCall, a former media executive whose air of elegance stands in stark contrast to Mr O’Leary’s brash persona, the airline has boosted the number of business travellers to about 20% of its total traffic.”We already have a gap and it’s very clearly perceived by consumers,” said McCall, speaking en route to Naples where EasyJet opened its third Italian base last month. “What I’m focused on is keeping that big gap.”By appointing someone with “gravitas”, EasyJet has become a brand that “stands more broadly for innovation, not just low pric Air Max Shoes es,” Mr Knapp said. “They’ve moved away from being just a budget airline and made customers reconsider.”Ryanair will spend about 35m this year on advertising and digital promotions, effectively tripling its marketing budget. Its first mainstream television ads outside of Ireland aired in the UK, Spain, and Italy this month, featuring self mocking reflections on Ryanair horrors moments.The ramp up is a marked shift for an executive who once prided himself on using press coverage of outlandish publicity stunts to grab passenger attention. Antics include threatening to make people pay to use toilets on board, buying a taxi license plate to get to work faster, and a calendar featuring scantily clad female cabin crew.