Virgin going upmarket

[kamchatsky]

Let's give John Borghetti some ideas, not that he really needs it given he was from Qantas .....

Virgin launches rescue mission

Virgin launches rescue mission
DANNY JOHN AND SCOTT ROCHFORT
June 3, 2010

The new Virgin Blue chief executive, John Borghetti, is working on an overhaul of the airline's operations that could see several of its routes dropped and the number of brands it flies under cut from three to one.

Barely a month after taking the helm, Mr Borghetti has signalled the airline no longer has any desire to slug it out with Qantas's Jetstar and Singapore Airlines-backed Tiger over the bottom end of the market.

His intention, say analysts, is to turn Virgin into more of a business-focused carrier which will see improvements to its premium economy service, refurbished lounges and an upgraded loyalty program.
...

 

[crazydave98]

Let's give John Borghetti some ideas, not that he really needs it given he was from Qantas .....

See the "Dear John" thread under Velocity.

 

[haydensydney]

His intention, say analysts, is to turn Virgin into more of a business-focused carrier which will see improvements to its premium economy service, refurbished lounges and an upgraded loyalty program.

Thank god..... about time I say!!
The premium economy service is abysmal and the lounges are OK, but could be better. The loyalty program isn't bad though (esp if your silver/gold) so I would be interested to see what an "upgraded loyalty program" actually looks like...

 

[notzac]

Thank god..... about time I say!!
The premium economy service is abysmal and the lounges are OK, but could be better.

No arguments from me on either of these points.

The loyalty program isn't bad though (esp if your silver/gold) so I would be interested to see what an "upgraded loyalty program" actually looks like...

Actually, there are some fairly substantial problems, mostly to do with earning on partners and stuff taking forever and a day to credit (if it actually manages to do so at all). In this day and age of modern technology, things like points being credited in a timely fashion should be a given.

I know I probably sound like a broken record, but the list of partners that recognise status and offer benefits really isn't long enough yet.

 

[ozmerish]

This article just appeared in ATW...

 

[samh004]

This article just appeared in ATW...

Wow, that paints an interesting picture. I think it’s a good move though, focus on the restructuring, then when that’s done, expansion can resume. I’ll be very interested to see where they take themselves.

 

[oz_mark]

Wow, that paints an interesting picture. I think it’s a good move though, focus on the restructuring, then when that’s done, expansion can resume. I’ll be very interested to see where they take themselves.

777's to Perth I say

 

[anat0l]

Interesting moves and sounds, but it would really be good to have another premium liner in the Australian market. Preferably one that might join one of the major alliances.

 

[jsd]

However, to alter its rewards program it needs to upgrade its reservations system, and a new res system will not be in place until December.

So what are DJ changing to next weekend then


Josh

 

[harvyk]

I see my crystal ball is still accurate... The three brands to one - well they can't use Virgin outside Australia, so we'll probably see it become V-Australia, thus scrapping their original LCC brand name...

Improvements to it's Y+ product will take it upto J, and thus DJ will start using the "Business" class rather than "premium ecconomy".

I also do see them upgrading to widebodies for some PER to east coast, would be beneficial for early morning flights. Don't know about B777's, but prehaps B787's?

The one thing I would like to know is are they going to start offering meals \ refreshments as part of the ticket for Y pax. That is the one thing the crystal ball hasn't yet told me...

Now all I need to do is search back through AFF and find the posts where I predicted these things happening...

 

[oz_mark]

I also do see them upgrading to widebodies for some PER to east coast, would be beneficial for early morning flights. Don't know about B777's, but prehaps B787's?

While 777's may not be the ideal aircraft, they do have one or two of them around. I think they will find some advantage in segmenting its routes along the lines QF has done with citiflyer, and further with the trans-con flights to Perth.

The overall problem with going upmarket, though, is going to be funding it, so I think things will roll out over time.

 

[samh004]

777's to Perth I say

But that would go against their halt on expansion (and new planes) right now

Preferably one that might join one of the major alliances.

You mean like, they could join, OneWorld?

The one thing I would like to know is are they going to start offering meals \ refreshments as part of the ticket for Y pax. That is the one thing the crystal ball hasn't yet told me...

Considering their recent partnership with ANZ, who are going to be offering cheap no frills seats, and more expensive seats with frills, I don’t see why whatever DJ becomes couldn’t do the same. Depending on what ticket you buy, you’ll either get a meal included or you wont, and presumably the meal included ticket will be on par or undercutting QF ticket prices.

 

[777]

Interesting question about the use of the Virgin brand on international routes. Recently Virgin America started (or announced) flying to Canada and Mexico and to the best of my knowledge there wasn't even the slightest hiccup about it or need to change the name. Not sure why their situation is any different to DJ.

So, either they run and win an argument with Singapore and SRB to use the name (Virgin Australia on Virgin Blue) on all services or they drop it entirely and rebrand as V Australia across the network. I suspect there are furious negotiations going on either way - personally i like V Australia as the meta brand but a more upmarket Virgin Australia pitched much more like Virgin Atlantic and Virgin America and with connections to one of the major alliances could also work.

777.

 

[oz_mark]

But that would go against their halt on expansion (and new planes) right now

Details. But the review is more about where they want to go, rather than where they are now.

Any move upmarket is going to come with a degree of delivery risk, but if they are wanting to target premium markets then taking those risks and appropriately managing them is something they are going to have to do. Halting expansion only works for a little while