Daily Archives: July 9, 2010

WiFi on Southwest Airlines: Is it ‘Shovel Ready’?

09 Friday Jul 2010

Posted by in Branding, Customer Relations, Customer Service, Ethics, Government Regulation, Information Technology, Internet, Management Practices, Public Relations, Re-Imagine!, Relationships, Rotary, Social Interactive Media (SIM), Social Media Relations, Travel, Website

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by Paul Kiser
USA PDT  [Twitter: ] [Facebook] [LinkedIn] [Skype:kiserrotary or 775.624.5679]

Paul Kiser

In the July edition of Southwest Airlines ‘Spirit’ in-flight magazine SWA takes a swipe at “President Obama’s” Recovery Act (I’m pretty sure that more than one person put together the program that pulled us out of economic disaster) and informs the passengers that the definition of ‘Shovel Ready’ is also associated with a project that has failed. Obviously, there is no LUV coming out of Texas for our 18-month old administration, but I was surprised that they would put a political biased slam in their customer publication.

Regardless, I will take their lead and use their definition to ask if the Southwest Air WiFi program is ‘shovel ready’?

Southwest was testing WiFi on four planes (I’ve also heard that only one plane had/has the service) as early as March 2009. I flew a WiFi-enabled plane from Denver to Reno a several months ago when they had to replace the plane we were supposed to fly. After boarding the plane several hours late the flight attendant announce that to make up for our delay we at least would have WiFi because we were on the ‘special’ plane. She then immediately said that we would not be able to use the service, but didn’t say why. That seems to typify Southwest’s efforts to get WiFi off the ground.

Southwest has a page on their website that announces the new WiFi service to begin in early 2010. Is July early? Note that you can only find this page by a Google search or by going directly to the page at:

Southwest Air WiFi Page

If the link is dead that will mean that Southwest read this post and someone in IT probably got chewed on for not killing the page. In case they update the page, here is what it said as of today (July 9, 2010):

“Southwest Airlines is excited to offer satellite-enabled Wi-Fi internet access onboard. The service is currently on four aircraft, but we hope to begin equipping more of the fleet with this cutting-edge technology in early 2010.”

In Gary’s Greeting on the SWA website titled “Technology is Our Friend,”  CEO Gary Kelly spends two sentences on the WiFi service:

“Many Customers want to stay connected while aloft, and your chances of flying on a Southwest Wi-Fi-equipped jet improves as the year progresses. In April, we began a two-year process of installing this state-of-the-art connectivity on our entire fleet.”

Other than that Southwest is making no effort to publicize the new WiFi service, which begs the question “Is there a problem?” Early 2010 has come and gone, April 2010 was three months ago, where’s the WiFi? I understand that it will take some time to install it on all the planes but this is a marketing opportunity and a major addition to in-flight service. Is SWA just unenthusiastic, uncaring, or embarrassed about offering WiFi, or is there a problem? If it was meant to be a secret it was not the smartest move to build a webpage to announce the service. My guess is that there have been major problems and the corporate PR people are hoping no one will notice. If that’s the case then they would be wrong.

LUV is the SWA Way, but you pay for WiFi

They have said that the service will not be free. That’s disappointing from a business standpoint. For an airline that is full of LUV’ it would seem that one inexpensive way to build customer love would be to offer free WiFi like Starbucks. I published an article today praising the wisdom of free WiFi and rather than repeating here I’ll offer the link to the article.

(The business benefits of free WiFi)

I admit I am biting the hand that feeds me. I will only fly SWA unless I can’t get to a city with their routes. But between the political jab in Spirit magazine and the noticeably absent WiFi service I am not feeling the LUV right now. I’m sure I’ll get over it and in a few weeks I’ll be flying to Dallas on SWA and I’ll be happy to do it … but just in case Gary Kelly reads this please note that ‘thump’ you hear outside of Las Vegas or Austin might be me landing a few minutes before the plane does. You never know, some people have no sense of humor.

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Starbucks makes a smart move: Free WiFi

09 Friday Jul 2010

Posted by in About Reno, Branding, Communication, Customer Relations, Customer Service, Information Technology, Internet, Lessons of Life, Management Practices, Public Relations, Re-Imagine!, Relationships, Rotary, Social Interactive Media (SIM), Social Media Relations, The Tipping Point

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by Paul Kiser
USA PDT  [Twitter: ] [Facebook] [LinkedIn] [Skype:kiserrotary or 775.624.5679]

Customer Loyalty: Paul Kiser in Starbucks style

Today I’m dressed like a Starbucks employee to honor the wisdom of the decision-makers at the famous coffee company to team with AT&T to offer free WiFi to all. They started it on July 1st. It is a smart move…a very smart move.

Why? There is one common aspect of every successful business and it is simply to give your customers a reason to love you. That’s it! Customers who love a service or product is an absolute ‘must’ if you want to build customer loyalty and business referrals. You can spend millions of dollars in advertising and not get the return that a company gets with requited love from their customers. With free WiFi Starbucks has found a way of creating value-added service that will cause many people to love Starbucks.

If you have a ‘butts-in-the-seats’ type of business and you want customers to: 1) frequent your location, 2) spend time and money in your business and, 3) be loyal to your business then free WiFi is one of the best ways to make it happen. Here’s what will happen for Starbucks over the next 12 months.

  • Starbucks will see increased traffic of laptop users (a ‘small’ market of people who will buy almost 200 million laptops in 2010)
  • Starbucks will see more repeat business
  • Starbucks will be more visible to more people
  • Starbucks will not need to spend as much on advertising and will get more social media publicity

All butts-in-the-seats organizations would like to experience these four outcomes in their business, so why don’t more places offer free WiFi? In brief, the answer is ‘accountant-think’, which is always short-sighted. The common rationale is one of two issues. First, instead of seeing free WiFi as an inexpensive way to add value to their service the accountant-think business people try to make it a revenue source. In Reno, Nevada the major hotel/gaming properties have been known to charge as much as $500 to ‘turn on’ WiFi in their convention areas and most of the properties charge around $13/day for guests to have access to WiFi. The result is that technology conventions go elsewhere rather than be charged for a service that they can get for considerably less (or free) in another market. The Reno gaming properties have boxed themselves in with contracts or dependence on the revenue source from WiFi, so they are now in a death spiral of losing more and more business or give up a piece of their dwindling revenue.

Last year I was in Las Vegas on a business trip and stayed at the South Point property. They charged a fee for WiFi, so I went to Starbucks to get online (my home account is with AT&T, so I’ve always had free access at Starbucks.) Afterward I picked up dinner at the Outback Restaurant next door and took it back to my room. South Point didn’t get me to stay on property, nor did they even get me to eat at in-house, simply because they didn’t offer Free WiFi. Is that a smart business move on their part? Nope, just good, solid accountant-think.

The second rationale accountant-think executives is that WiFi customers don’t have a revenue impact. In August of 2009, Erica Alini wrote an article for the Wall Street Journal (NOTE: the Wall Street Journal or WSJ is a historical archive of old business trends written by accountant-think reporters) that declared, “Coffee Shops Pull the Plug on Laptop Users.” For her article Ms. Alini cites three examples in New York that discussed limiting or eliminating laptops at a cafe or coffee shop. The most common problem seemed to be too many customers … what a tragic problem … and that some laptop users were purchasing minimal product. However, Ms. Alini admits that some places were using laptop users to ‘make the place look busy.’

A deserted restaurant is cause for people to avoid the business, so having customers, even minimal revenue producing customers, can mean more paying customers. My question is how much would a coffee shop have to pay people to sit and look like customers? Free WiFi is a small price to pay. I spend $10 to $15 per day at my Home Starbucks on Keystone in Reno, NV, USA. It will not make me a shareholder, but it is money I would not spend in one place, except for the fact that I am a captured customer. I also always meet with people at a Starbucks, so I bring in additional customers. The major factor in my customer loyalty is the access to free WiFi.

Starbucks has made a very smart business move with making free WiFi a value-added service for all and the return on the service will reap big dividends in customer loyalty and increased traffic (butts in the seats.) Starbucks customers have a new reason to love Starbucks and that is key to survival in today’s world. But don’t try telling that to the accountant-think executives running other stores and restaurants. They just won’t understand it … and I’m sure that’s okay with Starbucks.

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