As Airlines Look for More to Sell

As Airlines Look for More to Sell, Your Comfort Is Their Merchandise The airline industry’s push to impose new charges for small perks has come to this: “subscriptions” for extra legroom. In its latest revenue-raising experiment, United Airlines has introduced annual payments that provide travelers with roomier seats or the ability check a suitcase without an additional fee. For $499, you can sit in United’s Economy Plus section each time you fly and enjoy four or five extra inches of legroom, depending on aircraft model. A $349 option—with United generously agreeing to waive its arbitrary $50 initiation fee, yea!—buys one checked bag on every flight for a year of flights. Or check two bags all year for $399.United currently has 16 products for sale through its Travel Store, including the option to hold a fare for up to a week before you purchase. That power, of course, is particularly useful now that the major airlines, led by United in April, hiked their fee to change a domestic ticket to $200. American Airlines will even let indecisive travelers buy their way out of the $200 penalty: Choice Essential and Choice Plus fares, which the carrier introduced six months ago, include one checked bag and waive the ticket-change fee. Or let’s say you get hungry when flying to Europe but can’t stomach the typical in-flight chicken breast? US Airways has started selling a new line of premium DineFresh meals on its international flights, offering assorted charcuterie, antipasto, vegetarian orzo, and a half-bottle of coach online outlet wine for $21.99. The airline also sells a $7 Power-Nap Sack on flights over 3.5 hours containing a fleece blanket, neck pillow, eyeshades, and earplugs. Note the branding.The point is clear: Airlines are striving like mad to become merchandise marts full of new products and services, a shopper’s paradise for people willing to fork over cash upfront for the prospect of a better experience when they travel. Commodification has been one of the central themes in airlines’ disastrous financial performance since the industry was deregulated 35 years ago. In the eyes of many consumers, every coach outlet sale flight is the same beyond the core variables of time and price—and even the price is often the same, down to the penny, lest one airline lose market share on a competitive route.Hence the race to differentiate the product, whether it be flat beds on cross-country flights, expanded legroom, first dibs on the overhead space, Wi-Fi passes, coach outlet sale or new services to deliver your bags to your destination before you arrive. At coach online outlet least six carriers, including American and Frontier Airlines, have also introduced “branded” coach fares, where paying more offers additional services.Airlines are “maturing as retailers” and are motivated to find new ways to show off product investments, says Rick Elieson, American’s managing director of digital: “It’s not just about getting from A to B. It’s about what coach outlet online are you going to get for that price?” To get travelers to stop focusing on the basic airfare, the retail approach is considered a smart way to go. “Industry wisdom indicates the vast majority of consumers only want the lowest price. Yet, when properly merchandised, airline travel can fetch a premium,” according to an April report (PDF) on airline retailing by IdeaWorks, a travel consultancy. There is also the reasonable expectation that if you’re paying an airline hundreds of dollars before you even step foot on its plane, chances are very good you’ll dedicate most of your business to that airline for at least the next 12 months.For some, the new world of airline merchandising might make travel seem more like a restaurant meal, with optional expenses that can be added at the customer’s discretion. Airline press releases announcing coachoutlet.com these new products and services almost always emphasize one or all of the following words: relaxing, rewarding, comfortable, convenience, options, and value. “A la carte” is also popular, to carry the dining analogy further.Those travelers inclined to a not-so-positive view may feel airline hands in their wallets at every click of the mouse. United and others are disaggregating each piece of the flight into ever-smaller components, in effect saying: Give us $848 and for the next year you can forgo the indignity of paying $25 per trip to check your suitcase and sucking on your knees in 37E. Each time you pay us, there will be slightly less pain. Before it's here, it's on the Bloomberg Terminal. LEARN MORE

3 Reasons Michael Kors Shares Are Crashing

3 Reasons Michael Kors Shares Are Crashing Ashley Lutz coach online outlet Nov. 4, 2014, 2:23 PM 4,709 2 facebook linkedin twitter email print Getty The Michael Kors brand might be past its prime.  Shares are down as much as 8% today on concerns that the company's growth is slowing. Despite a same-store-sales increase of 16%, many analysts are worried that the business is unsustainable  The fashion label, which coach factory outlet online enjoyed a stunning rise in popularity in recent years, is facing new challenges. Forbes notes that Michael coachoutletonline Kors is no longer a billionaire because shares have declined in recent months. Here are a few big problems with the brand.  1. Everyone is wearing Michael Kors.  Widespread popularity is the "kiss of death for trendy fashion brands, particularly those positioned in the up-market younger consumer sectors, " industry expert Robin Lewis writes on his blog. Lewis compares Michael Kors to Tommy Hilfiger, which reached its peak in the late '90s.  coach outlet sale Michael Kors is considered an aspirational brand, with consumers paying a premium for its label. Once everyone has the product, it is no longer considered cool.  Other brands who have experienced this phenomenon include Juicy Couture, Jordache, and Coach.  Google searches for the brand are declining in the US. Baird coach online outlet Equity Research 2. Inventories are piling up.  Michael Kors is entering the current quarter with a 65% inventory increase, writes retail equity analyst Marie Driscoll.  While the company says that the excess inventory is because of the company taking the e-commerce business in-house, Driscoll is skeptical that it will sell.   "That’s a lot of inventory in an increasingly competitive category," she writes. "I'm worried." She also compares Michael Kors to the Tommy Hilfiger collapse more than a decade ago.  "While the brand continues to enjoy vibrant demand, these investors are on to greener pastures," she says. "It’s probably time to sell KORS shares!" Shares are down 25% in six months. Yahoo! Finance 3. The strategy could backfire.  Michael Kors has also has several brands at different price points, a strategy that could easily backfire, Lewis says. Kors has a high-end department store brand, a middle-market brand, and discount outlet stores.  "Some would argue all of those coachoutlet.com segments will simply end up competing with each other, thus cannibalizing the top end of the spectrum," he writes.  In other words, consumers won't pay $300 for a department store Michael Kors bag when they can get one at the outlet mall for half-price.  SEE ALSO: Everything You Wanted To Know About How McDonald's Food Is Made Follow Us: On Facebook. More: Retail Michael Kors