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March 09, 2007

Air Scoop Article: A Proposed Environmental Public Relations Strategy for LCCs

The following is an article I wrote that was recently published in the European low-cost airlines newsletter Air Scoop. It contains some interesting information about how European low-cost carriers (LCCs) should combat their negative publicity, especially in the UK where airlines are being targeted by environmental groups. The text of the article is given below, and after it I have some additional commentary on what more LCCs should do to proactively address the environmental question.

A Proposed Environmental Public Relations Strategy for LCCs

All European airlines face immense challenges in combating negative publicity over their impact on climate change. However, LCCs have a number of environmental advantages over legacy carriers that can be used in the climate public relations battle. And many European LCCs can positively contrast their more eco-friendly tactics with LCCs in the ecologically challenged States. In order to sway public opinion, LCCs need to emphasize their environmentally friendly policies while at the same time solidifying and strengthening their stands on complex issues such as the EU Emission Trading Scheme and “green” taxes. 

For European LCCs to effectively communicate to passengers the effects of intra-Europe air travel on the climate, they need to give passengers the requisite facts about the effects of aviation on climate change, and the steps they are taking to minimize their impact. Many consumers believe that LCCs are environmentally unsound businesses because they believe the two primary criticisms of how LCCs exacerbate climate change:

  • First, unlike legacy carriers that have taken decades to build large fleets and complex route networks, LCCs have grown extremely quickly. So while legacies still account for a majority of aviation-produced pollution, the share of pollution contributed by LCCs is growing rapidly.
  • Second, most travelers who fly on LCCs are taking discretionary trips that can be minimized or eliminated. This is evidenced by the high concentration of LCC flights to vacation destinations such as the Balearic Islands, Malaga, and the Canary Islands. Many people fly more often than they otherwise would because LCCs price these flights so inexpensively.

If European LCCs want to create a balanced dialogue with consumers, they must effectively communicate the steps they have taken to make their businesses environmentally friendly. Customers must understand that many of the measures LCCs take to lower fares also help to minimize the environmental impact of air travel. Also, consumers may find satisfaction that as a result of these measures, European LCCs pollute less than their counterparts in the States. Some of these measures are listed below.

  • European LCCs are not only fitting more seats into aircraft than LCCs in the States, they are filling them with load factors that are on average 5-15 points higher. On their A319s, easyJet has a full four rows more than the A319s of Frontier Airlines and last year, easyJet’s load factor was over eight points higher than Frontier’s. British Airways has one row less of seats than Frontier or 30 fewer seats in the same aircraft than easyJet. More passengers and higher load factors yield less pollution per passenger.
  • European LCCs have also been more effective than American LCCs at reducing aircraft weight, primarily through stricter baggage policies. These policies are effective at reducing what customers carry and reducing the environmental impact of air travel. But the grandfather of LCCs, Southwest, still has an archaic policy which allows customers to check up to three 50 lb bags for free. This leads to heavier aircraft that consume more fuel and spout more emissions. BA and other European legacy carriers have been tightening baggage policies far more stringently than American legacy carriers, but their policies are still more generous than European LCCs.
  • Europe’s largest LCCs including Ryanair, easyJet, and Air Berlin all use new aircraft that are cleaner than older aircraft. Many of these aircraft are also equipped with fuel-saving technology such as winglets, giving them an ecological advantage over legacy carriers, which operate a mix of older and newer aircraft. Most LCCs in the States are also using newer aircraft, one of their few cost advantages over legacy carriers.
  • Many European LCCs are strictly point-to-point airlines which helps cut the distance a passenger flies to his or her destination, reducing their impact on the environment. Legacy carriers around the world operate hubs that are efficient, but nonetheless require passengers to travel farther than they would on a point-to-point flight. Most US LCCs are at least partly hub-and-spoke.

Informing the public of these advantages in a clear and concise manner will help customers understand the ecological advantages LCCs have over other airlines. Moreover, LCCs need to clearly explain to customers their position on two controversial programs that impact passengers and airlines.

The first is the EU Emission Trading Scheme. Many LCCs seem to understand that emission trading is the best system for reducing aircraft emissions, but LCCs might consider pressing for changes to make the system fairer. These include:

  • Ensuring that long-haul flights on any airline to/from Europe are covered so passengers who fly longer distances on an airplane, regardless of the airline, will pay their fair share.
  • Pressing for tough restrictions on the minimum number of seats airlines can configure their aircraft with, which might force legacy carriers to cut premium seat sections and make their aircraft more efficient to operate.
  • Ensuring that the EU presses other nations, including the United States and China to develop similar schemes to control emissions. EU airlines should not be the only ones making sacrifices for the planet.

LCCs also need to communicate to passengers what “green” taxes LCCs find acceptable. Many customers justifiably believe that airlines are opposed to any taxes on air travel, but some LCCs recognize that some environmental taxes are necessary for passengers to pay, a fact many passengers aren’t aware of. LCCs need to set clear criteria for new or expanded air travel taxes that passengers can comprehend and empathize with. Some possible criteria include:

  • Tax increases must be phased in over a period of at least six months, so a fiasco similar to the current APD crisis doesn’t reoccur.
  • Taxes must directly fund environmental programs such as the formation of carbon sinks.
  • Tax increases are proportional to the airline, duration of flight, and class of travel. Passengers who fly more environmentally friendly carriers shouldn’t pay the same rate as those who fly on dirtier carriers, and like the APD, passengers who fly in premium classes should pay more than passengers who don’t.

LCCs also need to offer an alternative to environmental taxes. Perhaps the easiest idea is to allow customers to donate to a carbon offsetting charity to compensate for the emissions of their trip right from the booking page. To launch this feature, airlines should match customer donations up to a certain figure.

If LCCs create a dialogue with customers, they must acknowledge the successes, but also the steps that still need to be taken by passengers and airlines to achieve further reductions to the human impact on climate change. An advertising campaign that discusses the environment and not travel may be the best way for LCCs to start a dialogue with customers. LCCs should consider voicing their environmental message in various formats including:

  • An advertising campaign similar to HSBC’s latest campaign in the UK. This brilliant campaign contains a positive, down-to-earth message that customers can relate to. The campaign de-emphasizes the negative image customers have of banking and instead focuses on what HSBC has done to reduce its environmental footprint, what more they still have to do, and most importantly, what customers can realistically do to help.
  • Information in in-flight magazines and other sources on the aircraft with the same content as proposed in the advert campaign above.
  • A prominent, detailed, dedicated page to the environment on their Web sites.

European LCCs shouldn’t hide the fact that they contribute to climate change. Instead, creating an open and frank dialogue will help customers understand the challenges airlines face, the steps most LCCs have already taken to reduce their environmental impact, and the steps they plan to take in the future. If LCCs don’t present their own solutions to slowing climate change, then the uninformed public will side with governments, which will impose higher taxes and an EU Emissions Trading Scheme that will unfairly punish LCCs.

In addition to what is written above, there is another big thing LCCs can do that I don't feel I emphasized enough in the article. While the article discusses marketing strategies airlines can use to combat negative environmental PR, which requires minimal effort on the airline's part, LCCs also need to do more than just talk in their approach to battling climate change. Unfortunately, LCCs have done most of what they can do, short of slowing their growth to reduce emissions. So instead of the LCCs reducing emissions directly through their own operational changes, more emphasis should be placed on how LCCs can be used as a vehicle by which to communicate with their customers about environmental issues. European LCCs need to use their sales abilities to sell customers on the environment. There are some very easy things consumers can do to reduce their impact on climate change, and an aircraft with no in-flight entertainment provides the perfect venue to sell customers on these solutions. LCCs shouldn't lecture customers on every possible environmental step they can take, since many simply cannot afford to make their lifestyles completely environmentally friendly. But LCCs can present simple, realistic solutions every customer is able to adopt. Airlines should try to sell customers on these actions through various promotions and sales opportunities that benefit customers, airlines, partner retailers, and most importantly, the environment.

The first and foremost environmental idea that should be promoted is the use of energy-efficient compact florescent (CFL) light bulbs. Many customers still don't understand the benefits CFL bulbs bring to both the environment and their pocketbooks. CFL bulbs save energy costs by using less electricity, and produce fewer emissions over the lifetime of the bulb. The primary reason so few individuals switch to the CFL bulbs is because they're too expensive. At some stores, CFL bulbs can cost as much as three to five Pounds, while incandescent bulbs often cost 25-50 Pence. If LCCs handed out certificates to customers on board the aircraft, which customers could exchange for a free energy-saving bulb, it could be a win-win-win situation for all sides. Customers would receive a free energy-saving bulb, LCCs could combat some of their negative PR by taking proactive steps to help their customers cut emissions, and retailers that partner with airlines would get customers in their stores where those customers would likely spend money on other goods. A certificate giveaway would enable customers resistant to adopting CFL bulbs to try them out before paying for them. Airlines and retailers could split the cost of the redeemed certificates, depending on the details of the partnership. Since the retailer would receive significant marketing exposure on board the aircraft, it might take a larger share of the cost of the certificates than the airline.

A modified version of this idea would be to sell certificates on board aircraft that customers could exchange for a multi-pack of energy-saving bulbs. The certificates would be expensive compared to other goods sold on the aircraft, perhaps between 5 and 25 GBP depending on how many bulbs are sold in the packs, but they would still enable customers to purchase bulbs for less than they would pay if they went to the store and bought them directly. It would also provide the same benefits as the plan above, except that fewer customers would take advantage of the offer, so retailers would see less traffic, and the customers who did purchase the bulbs would probably already have been convinced of the benefits of CFL bulbs, unlike in a certificate giveaway where customers reluctant to purchasing CFL bulbs could try them out before they paid for them. If LCCs sold multi-pack certificates, retailers would probably pay for the entire cost of the certificate, since if the LCC split the cost it could easily wipe out the airline's profit margins. However, depending on the arrangement, the LCC could make a small profit by selling the certificates on board, though the LCCs margins on the multi-pack CFL bulb certificates would be much lower than on food or duty-free goods.

If LCCs wanted, they could also bundle certificate giveaways or discounts to whether customers pay extra for certain privileges, such as priority boarding. Customers that pay for priority boarding could receive an additional discount on certificates, or additional certificates for free bulbs. I’m sure there are other ways that a CFL promotion could work, but these are merely my suggestions.

The second thing LCCs can do to proactively promote an environmentally friendly agenda is to offer free coupons for reusable shopping bags that customers can pick up at partner retailers. Customers could easily reuse these shopping bags instead of using disposable plastic bags when they shop, saving energy and emissions that result from plastic bag production. Again, this arrangement would be a win-win-win, since customers would get a free bag they could use to shop, retailers would get customers in the door, and the airline would get the good PR, knowing that their customers are trying to protect the environment. In this case, retailers would probably pay for the entire cost of the bag, since it costs very little, it could promote the name of the store on the bag itself, providing further marketing exposure, and a bag giveaway is a great way to get customers in the store.

The third thing that should be promoted is recycling. LCCs should do a better job of recycling customers' waste on board the aircraft. While recycling won't directly reduce greenhouse gas emissions, it will save energy because recycled goods require much less energy to produce. Recycling more of the waste generated on board aircraft would also encourage customers to conduct their own recycling at home. While many citizens do their best to recycle what they can, not enough is being done to prevent recyclable goods from being thrown away, and hopefully, airborne recycling would reinforce recycling habits at home. While some LCCs have explored this option, there are certain cost and operational reasons why this hasn't been implemented, but nonetheless, LCCs should take another look at on board recycling.

The fourth thing that LCCs should try to do is provide other ways customers can save on energy-saving devices. LCCs should consider partnering with the Government and/or utilities to provide customers with ways customers could save on energy-efficient appliances, microgeneration devices, insulation for windows, water heaters, and roofs, and other more expensive environmentally friendly products. In this type of arrangement, the LCC would be more of a promoter than an actual partner in the initiative; the airline would likely promote existing programs that governments and utilities have set up because LCC profit margins are too low to allow carriers to offer customers substantial discounts on these products. LCCs could promote these programs by handing out free coupon books that would give customers information as well as discounts on a series of programs that assist them in making their lives more environmentally friendly. But, LCCs could augment government and utility programs with their own programs (most likely administered by lottery) where any fare-paying customer who enters a drawing could be eligible to receive energy-saving improvements worth a certain dollar figure. The prize might be a gift card at a certain retailer in addition to other prizes, so airlines could get willing retailers to help sponsor and subsidize the program. This would get customers interested in what types of improvements they can make to their homes and lifestyles that save energy and protect the environment, even if they don't win the drawing, and it would get airlines involved in selling the virtues of environmental protection to customers who aren't aware of the steps they can easily take to protect it.

Above all, LCCs should provide customers with substantial amounts of information about how they can reduce their carbon footprints, from flight attendants, in advertising campaigns, on their Web sites, and in in-flight magazines. LCCs could even put an environmental tip on the headrest cover or some other area of the seat that would remind customers what they can do to help slow climate change. The information LCCs provide should be informative enough that customers will want to take serious note of it, consequently, it must be more engaging to customers than a series of facts published by environmental interest groups. By following these steps, as well as those outlined in the article, LCCs should be able to project a more environmentally friendly image by helping their customers live more eco-friendly lives, even if the airlines themselves don't make immediate changes that would reduce their own greenhouse gas emissions.

March 9, 2007 in EasyJet, European Carriers, Low Cost Carriers, Ryanair | Permalink

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