This summer, beware of the word “new” and its sidekick, “improved.”
The travel industry, flush with profits, is touting improvements to its products now, just as people begin to plan their summer getaways. But do their “improvements” make the product better, or are they just coming up with clever ways to siphon even more money from your bank account?
Often, the answer is “both.” Airlines overhaul their interiors while nudging the seats a little closer together. Car-rental companies add new vehicles to the fleet and then reclassify the new models so they can charge you more. But sometimes, it’s a shameless money grab — a product that costs more and gives you less.
That’s what Mike Pomeroy says happened to him when he rented a “midsize” car from Hertz and received the keys to a Nissan Versa, a hatchback that Car and Driver magazine called “America’s cheapest car” and classified as a subcompact. When Pomeroy picked up the car in Bellingham, Wash., recently, he told the agent that a Versa wasn’t a “midsize” car. The agent disagreed.
The creative reclassification of car types, he adds, “smacks of bait and switch.”
Hertz says Pomeroy is right. “This was a mistake, unfortunately,” spokeswoman Anna Bootenhoff said. “Please extend our apologies for the confusion caused.”
Hertz is hardly alone. In 2009, eagle-eyed readers of this column caught Alamo reclassifying its VW Beetles as midsize cars, even though the manufacturer claims they’re compacts.
In the airline industry, cabins are continually being reconfigured. But JetBlue Airways’ recent A320 “cabin restyling” drew more attention than the rest because it was heavily promoted. Among other things, it promised better Internet connections, a new in-flight entertainment system, power outlets, ergonomic seats and “generous personal space.”
What JetBlue failed to advertise, but observers quickly noticed, was that it was also squeezing more seats into the cabin, increasing the number of passengers from 150 to 162. Each row lost two inches of legroom, which, for a company that said it would bring “humanity” to travel, doesn’t sit well with passengers such as Peter Hoagland.
“It reminded me of companies that redesign packaging as sleight of hand in hopes that the consumer doesn’t realize that they have shrunk the size,” says Hoagland, a marketing consultant in Warrenton, Va. “And that is exactly what JetBlue is doing: shrinking passenger room.”
I suggested Hoagland share his misgivings directly with the airline. It sent him a form letter that said it regretted he had concerns about the changes but noted that its “brand-new” look would “ensure we continue to offer the best experience in our industry.” Even with its shrunken legroom, it still offers more space than its competitors. The point goes to JetBlue.
Marketing experts say there’s an ethical way to improve your product, and a greedy way.
“If your repackaging is offering more for less — as in the case of a midsize car becoming economy — that’s an example of repackaging that works for the consumer,” says Beck Robertson, a managing director of London-based Brandables Creative Consultancy. “But if you’re just using it to slash company costs and make a profit, without giving good value to your customers — like offering them fewer phone minutes and texts for the same price — that’s not a good deal. That’s just a cynical profit-boosting attempt.”
As a traveler, you can’t control what kind of products airlines or car-rental companies put in front of you. But you can control how you react. Do you buy — or walk away? Many careful travelers will walk away, convinced that they’re getting an inferior product for the same price, or perhaps more than they used to pay.
This phenomenon of repackaging products to offer less was last seen on a large scale at the end of the last recession when, for example, food companies “improved” canned goods by cutting the amount of vegetables they packed in them. It’s a time-honored corporate strategy. By charging the same price, they covered their cost increases while earning a profit.
In this case, costs are not increasing. Fuel prices, which represent one of the largest costs to an airline, are relatively low, leading to record profits. Survival is not the motive behind these moves to repackage travel. This is more of a money grab.
And it will probably work. Most consumers are price-sensitive and don’t pay close attention to what they’re buying. They may overlook the fact that JetBlue, which used to include the cost of a checked bag in all of its fares, no longer does — an oversight that benefits the airline. They may not even realize that their midsize vehicle is actually an economy car.
Maybe it’s unfortunate, but the current political climate won’t allow the government to regulate items such as rental-car classes or to compel an airline to offer passengers a minimum amount of legroom. The solution lies with travelers.
As you plan your summer vacation, you’ll probably hear the words “new,” “improved” and “upgraded” thrown around a lot. That should not be an enticement, but a warning. Travel companies don’t make improvements unless doing so leads to an improvement of their bottom line. And odds are they’re expecting you to fund it.
Elliott is a consumer advocate, journalist and co-founder of the advocacy group Travelers United. Email him at email@example.com.
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