If you subscribe to the view that bad publicity is better than no publicity at all, then you would probably say that last week was great for Spirit Airlines. The air carrier raised eyebrows not once, but twice in a few days’ time. First, Spirit announced new fees for checked baggage that could result in a passenger paying as much as $100 per bag. While the typical rate paid would more likely be on the order of $35-$45, the fact that a $100 fee is on the books outraged many fliers, even people who do not fly Spirit.
Second, Spirit was at the center of a controversy with a dying Marine who requested a fare refund after he was told by doctors not to fly because he was too sick. Spirit initially rejected the request and made a very public case that its policy prevented a refund from being issued. The company eventually relented and issued a refund and made a donation to a veteran’s charity, but not before the public railed against Spirit’s callousness.
The pricing, customer service, and PR tactics displayed by Spirit Airlines lead many to question how the company stays in business. The answer is simple: In many industries, there is a space for a low-priced, no frills seller. Spirit occupies that space in the airline industry. Its model is to offer low base fares and unbundle virtually all services associated with air travel and charge separately for them. There is actually an advantage to consumers for this à la carte pricing approach in that you only have to pay for services you want. Most airlines use some form of this pricing approach; Spirit has taken it to the extreme.
Many people are incredulous at the lack of concern some of Spirit’s actions project. Spirit’s practices are far from textbook examples of good customer service. There is good news for those of us who do not like the brand values displayed by Spirit Airlines – we can use the power of our wallets and fly with other carriers. It seems that executives at Spirit Airlines have overlooked that customer value is determined by more than benefits received for the price paid. Many people factor in a company’s reputation and commitment to concern for customers, employees, and society in general when making buying decisions. Spirit Airlines will continue to serve a customer niche that finds the company’s value proposition palatable. But brands with true spirit aspire to go beyond making money to making a difference.