Business continues to be challenging for the travel industry, with airlines among the hardest-hit sectors. While most airlines are still flying, getting back to where they were remains a serious challenge. In an effort to find an answer, several brands began offering changes they hoped would incentivize air travel again.
One of the first ideas airlines floated was dropping the fee they charge travelers to change flights. Now, if travelers had an issue—often COVID related—that forced them to change their plans, airlines weren’t hitting passengers for the extra fee. For most airlines, the change to fee charges was a temporary action to try to get people on their planes. Recently, though, one embattled airline, United, announced that it would be dropping change fees for the foreseeable future.
There’s no doubt this move is positive consumer PR, as airlines have known that customers hated the change fees, something United CEO Scott Kirby readily admits: “When we hear from customers about where we can improve, getting rid of this fee is often the top request … “Following previous tough times, airlines made difficult decisions to survive, sometimes at the expense of customer service. United Airlines won’t be following that same playbook as we come out of this crisis …”
Now that United has set the bar in a notoriously competitive airline marketplace, many insiders expect other airlines to offer similar options. Some say this move by United telegraphs a change in the balance of power in the industry: for many years, airlines exerted almost total control. United knew its customers needed them, so cuts were made to service, and fees were added to increase profit margins.
At the present time, though, with fewer people traveling, airlines are facing an unfamiliar situation: competing for customers without some of the demand protections that had buffered them in the past. This creates an interesting dynamic in the travel industry. United is joining Southwest—which never had change fees—while American and Delta, two other larger U.S. airlines, have yet to make a public decision on the issue.
When asked about this, both American and Delta offered “wait and see” responses, with American telling the media: “We are always evaluating the market and we have no news to share at this time …” A Delta spokesperson said: “We know flexibility is important to customers and we are continually updating our policies to ensure we’re responding …”
With those two comments, it’s currently up to the consumer to decide if “no change fees” is enough of an incentive to choose one airline over another. If that turns out to be the case, the window for Delta and American to “ensure they’re responding” will close fairly quickly.
Ronn Torossian is CEO of 5WPR, a leading PR firm.