Anchorage is a hub for many major airlines that serve North America, but it’s also the home of Bahamasair and their recent $2 BN order for Boeing 737s. But even though the airline has just recorded its best-ever quarterly profit, it’s not without its challenges. Below we’ll explore three important areas of strength and three important areas of weakness for the regional airline.
A Strong Online Presence
In the past decade, the web has evolved from a place where you could find information to a place where you expect to find engaging content, whether that’s a blog post, an article on a major news site, or a song on Spotify.
It’s easy to understand why aviation fans would want to connect with a regional airline. After all, you can’t make a habit of flying long haul flights if you want to make a living as an airline pilot. But what exactly does a regional airline do that makes it so attractive to potential customers?
Well, for one, you can fly to a lot of different places and connect with a lot of different people. Also, the cost per mile is usually lower for a regional airline. For the same price as a roundtrip ticket from New York to Chicago, you could travel from New York to San Francisco on a regional airline.
Further, many regional airlines offer add-ons like food and drink that are worth considering if you’re looking for an inexpensive way to travel. For example, if you live in New York and are traveling to Chicago for a wedding, it might make more sense to take a family vacation to the Great Lakes and stay at one of these nice hotels rather than fly budget-wise and risk missing your flight.
A Loyal Customer Base
The web helps customers connect with businesses they know and trust, providing more opportunities for growth. For example, if you search for tires online, you’ll see all sorts of websites ranging from big brands to small, independent businesses that provide good value for your dollar. Well, same idea with airlines. If you’re searching for a deal online, you’ll find a wide variety of options from budget-friendly charters to fully equipped business class.
In the case of regional airlines, the competition is mostly limited to the big boys like Delta and United. And while those two airlines have plenty of imitators, none of them can truly understand what makes a regional airline special until they experience it firsthand. Customer loyalty is a huge strength for Bahamasair, as evidenced by their extremely high repeat business rates. For example, over 90% of their customers return year after year. And those customers are typically very happy with their experience, which in turn makes the airline very happy.
A Rapid Growth Strategy
Regional air carriers have seen a large increase in market share over the past two decades. While there are many reasons for this growth, including increased affordability and the rise of low-cost airlines, a large part of it has to do with the fact that these airlines target a specific audience. If you want to grow your business or brand, consider which market segment you should be targeting, and then craft your strategy to take full advantage of the situation.
For instance, if you’re an e-commerce business looking to expand your reach, you might consider a strategic partnership with an airline. You could offer discounted fares to customers who purchase products from your site, or you could even become a travel agent for the airline, booking flights and providing other corporate services to boost your business.
Three Areas Of Weakness
While we see so many strengths with the regional airline industry, it also has a few challenges that might surprise you. First, the biggest threat to any business is cheap, discounted travel – whether it’s from an unlicensed travel agent or a website that offers rock-bottom airfare.
Airlines need to be smart about combating this threat. While it’s great that they can offer great value for budget-conscious customers, it’s also important that they protect their core business and ensure that their brand is not diluted by partnering with a lower-cost brand.
Second, while we value loyalty from our customers more than anything else, it can sometimes be a double-edged sword. If you want to attract new customers to your business, you may end up losing some of your current customers by offering too many add-ons.
Finally, the biggest challenge for any airline is the competition. While it’s great that there are so many options for airfare and accommodation, it also means there’s a lot of potential customers out there, which can be both good and bad. Sometimes it’s good when you have so many choices that nobody can make a unilateral decision, but at the same time it can be bad if everybody starts cloning each other and nobody commits to anything.
To stay competitive, airlines need to continue improving their products and services to retain existing customers while attracting new ones. And for what it’s worth, we think they’ll do just that – despite the current pandemic.