Friends, how are you?

Air Canada has come out with a new service to “ease travellers worries.” Called On My Way the service offers travelers that have had their trip interrupted protection.

Protection in what form and from what exactly? According to the Air Canada website if you’ve been affected by harsh weather conditions that cause delays, flight and plane issues that force cancellations or pretty much anything else that restricts you from getting off the ground…then On My Way will provide assistance.

When you’ve signed up for this service you receive a special number to call. Calling that number a “special customer service agent” will rebook you on the very next flight (so you get dibs on that) and arrange for complimentary accommodations and means (that’s right, they foot the bill).

So what’s Air Canada’s strategy here? Model-wise it’s insurance. AC is betting that enough people will sign up for this service and that that number will be much higher than those caught in delays.

It’s a numbers game.

The insurance industry has made this work for years…so why not borrow this model for the airline industry?

As long as AC gets enough people to sign up…they’ll make a tidy profit.

When this first came out, naysayers demanded that AC should provide this service for free. Unlikely if not unthinkable.

 Now, before we move forward, I’m not what you’d call the biggest fan of AC to this point. I’ve been on plenty of flights with their share of problems. But as Canada’s main airline, I’ve always cheered them on, and even offered letters of advice warning on how to improve their service and avoid losing clientele.

That said, I’m a fan of this On My Way plan. The cost of $25 to $35 per flight isn’t unreasonable…and surely costs less than paying for a hotel and meals due to a delay.

 The question I pose is should some of these services not be built into the AC ticket price anyways. Here’s the thing…I’ve been on flights to Asia before, with American and Japanese carriers, and when things go wrong….when the delay turns into a longer and longer delay – resulting in extreme delays, changing planes, or needing to fly the next morning – the other airlines paid the bill for meals and hotels.

Whether these airlines still do this, I don’t know. But it’d be interesting to find out.

Back to the AC On My Way Plan. There are 2 areas that Air Canada needs to be careful with. Messing these two up and the new plan becomes a thing of the past:

A) Customer service. Sounds simple enough, but I’ve spoken to my share of customer service people that don’t know the first thing about customer service and taking care of clients and customers. These AC agents better be prepared to put out some fires (since anyone calling the number won’t be in a good mood to start with) and understand the purpose of their jobs. That is, to relieve the stress of clients and do whatever is necessary to keep them happy in a situation that isn’t happy to start with.

B) Logistics.Let’s say your flight is delayed until the next morning. You call the number. An AC agent then tells you to board a bus to your hotel. The last thing you’re going to want is to stand at a bus stop (especially if you are new to the city), board a bus and wait 30-40 mins to get to your hotel. AC must ensure that they have the logistical capability to get its clients to a hotel quickly and efficiently and that the process of them leaving the airport through to check-in is seamless.

The danger, a danger that exists with any such service offering, is that if Air Canada does not meet its customers expectations of this service (which will mainly be in the above 2 categories), customers won’t purchase the service on their next flight.

Like with any business, customer retention is just as important as customer acquisition.

Start losing customers and the numbers get wonky. And it’s all about the numbers.

It’ll be interesting to follow this as it develops.

To your success,
Michael