EasyJet looking to attract more corporate business

28.3.2011 (Fool)
Business customers are in the low-cost airline’s sights.

Executives accustomed to barging onto rush hour tube trains could soon be shouldering
their way onto more EasyJet
flights too, after the low-cost airline said it would roll out its flexible
tickets for business travellers.

Shares in the budget carrier we all love to berate rose 4% on Monday, after EasyJet’s
CEO Carolyn McCall
explained how the company will step up its attempt to steal market share from Europe’s legacy

But the rise is not quite a ringing endorsement for the new strategy. The shares
have merely bounced off a 52-week low, with all the airlines having been dragged
down in by higher oil prices and ongoing economic uncertainty.

Flexible Flights To Suit(s)

EasyJet began trialling flexible tickets in November, and initially targeted
sales through intermediaries. The main push will come this summer, when EasyJet
will offer the tickets to all its customers who book via its main website.

The flexible tickets enable a customer to change a booking up to two hours ahead
of departure (subject to other conditions). By wrapping this feature together
with other options including priority boarding and luggage checking to effectively
create a new class of passenger, McCall believes EasyJet can increase its proportion of business passengers from
18% to 21%.

Business customers are attractive, due to superior margins — these extra features
always cost more when you fly with EasyJet.  Business customers also tend to book
later, which also enables higher ticket prices.

The other strand of the strategy is to increase the number of flights EasyJet
runs from its main hubs, to better compete with the legacy carriers. EasyJet has
negligible routes offering five or more flights per day compared to British Airways, for example, and business customers like to have multiple options when choosing