Flybe: ‘Business is better face to face’.

A war of words has broken out between the airline and teleconferencing industries as they battle to attract the sales sector.

Faced with many companies banning all but essential air travel during the downturn, a focus on greener ways of doing business, the underlying terrorist threat and the proliferation of teleconferencing technology, it’s not surprising that this last year has been a dire one for airlines.

But it’s not just been the traditional carriers like British Airways that have suffered; low-cost airlines like Flybe (partly owned by BA and Britain’s largest domestic carrier) have also had to fight for every passenger.

Threat

The airlines view teleconferencing as a major threat and have recently run a number of advertising campaigns designed to knock the technology. In turn, teleconferencing companies like Powwownow have accused the airlines of ignoring their environmental responsibilities.

Specifically targeting the sales and business development sector, Flybe ran advertisements with the line ‘Business is better face to face’ while BA ran a promotion offering 5,000 business-class flights for new and existing exporters.

Hidden costs

Powwownow responded by pointing out that the flights ‘still cost the “winners” hundreds of pounds in taxes and charges’. The company has countered, firstly with a cheeky response to the Flybe ad – ‘Business is better if you spend less!’ – and now with its own promotion to small businesses offering 5,000 free conference calls in a send-up of the BA flights offer. 

The teleconferencing company has also hit out at the ‘evidence’ cited by airlines to support a claim that business is more effective face-to-face. Face-to-face meetings will turn 40% of potential customers into customers, compared with only 16% without face-to-face contact, say the airlines.

Powwownow version: spend less.

But the figures are suspect, says Powwownow: the figure comes from a ‘non-peer-reviewed US study sponsored by two industry groups, the US Travel Association and the Destination and Travel Foundation. And what are these two groups? The latter’s website says it exists to ‘bolster the destination-marketing profession and travel industry’. Enough said.

‘I have built successful businesses using conference calls, and I would like to help other small businesses do the same. Unlike BA, our prizes are completely free with no hidden taxes no charges, allowing businesses to reach the same decisions in a fraction of the time with no cost to them or the environment,’Powwownow’s chief executive officer Andy Pearce told ModernSelling.com. The war of words continues.

Travel sector response

Can the airlines come back from this? Maybe; there are always occasions when it’s necessary to do business face-to-face – there really is no substitute for meeting in person when the circumstances justify it. But, for routine meetings, services like Powwownow (I use it myself – Ed) or Citrix’s Go to Meeting (click link for a free sales meeting ebook) or Cisco’s TelePresence, amongst many others, mean that businesspeople are going to think much more carefully before they step onto a plane.

The air travel sector is going to have to:

• throw off a poor environmental image;
• provide a credible response to the underlying terrorism threat in a way that doesn’t overly inconvenience passengers;
• shrug off a reputation for crowding, poor value for money and technological glitches at London’s airports (viz the Heathrow Terminal 5 fiasco and BAA sell-off); and
• provide a service at a price that is justifiable in the context of competition from technologies that allow us to hold effective meetings over the web.

Sharp practice

And, in the case of BA – and to a lesser extent Virgin – the sector must leave behind its reputation for anti-competitive behaviour and sharp management practice, problems which were highlighted  when BA was fined getting on for £200 million by British and US authorities for price-fixing two years ago. At the time, Virgin only escaped the fines for rigging fuel charge surpluses because the airline turned whistle-blower.

One thing’s for sure, the battle to capture business from the sales sector will remain fierce as virtual meetings technology and airline business models evolve.

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