Today (23 May), Ryanair released its full year financial results, which saw average fares fall by 1% but profits rise by 43% to €1.2bn, (£960m) from the year prior.
The budget airline says it is now the number one airline in almost every EU country, with the exception of France where it is placed third. CEO Michael O’Leary puts its financial success down to its low fare and “extraordinary customer service” mantra. “It is a revolutionary concept in the airline business that you can have low fares and this extraordinary customer service as well. One where we love you, we take care of you,” he said.
This is a far cry from three years ago when O’Leary says Ryanair was portrayed as a company that “hated customers”. “We have been the victims for about 25 years now of various consumer surveys saying we are the most hated company, airline, god knows what – yet remarkably if you look at the growth in customers, the public doesn’t seem to be able to get enough of what we do,” O’Leary said “The last YouGov survey did highlight how we are the most improved consumer brand in the UK, although admittedly from a very low base.” The company is now moving on to the third year of its Always Getting Better (AGB) programme, a plan which aims to fix things Ryanair’s customers dislike and improve its offering.
Since the launch of the AGB programme, Ryanair has seen increased success and has gone from carrying the same traffic as Wizz Air two years ago, to now carrying 50% more than its competitor.
The company will continue investing in its AGB programme in 2016. This year’s main focus will be on digital acceleration and innovation, particularly through Ryanair Labs, and improving its mobile app. There will be a new leisure plus service, improved business plus and a “one-click” mobile facility on the mobile app. There will be auto check-in for my Ryanair customers and lower checked bag fees, along with more legroom on flights, new interiors and new staff uniforms, designed by cabin crewmembers.
O’Leary admits to not focusing the company’s attentions on customer experience enough in the past. “I think to be open about it I made a number of mistakes in the customer handling policy up until about two years ago. I would say we have been somewhat cavalier in the way we listened to customer feedback or responded to customer complaints.”
“We should have move to allocated seating earlier, we should have eased up on the carry on bag restriction earlier, we should have worried more about schedules and whether we had the right schedules for business passengers as well. We were genuinely dismissive of all these things.”
“If I’d only known being nice to customers was so good for our business, I’d have done it years ago”.
Michael O’Leary, CEO, Ryanair
Ryanair said that the airline never rejected marketing methods, it just had its own. In the beginning it didn’t have much money to spare for advertising or expensive PR, so instead followed every “ludicrous publicity stunt” it could, including charging for its toilet seats. “If it makes for cheap PR we’re up for it,” O’Leary commented.
One of the company’s most recent publicity stunts includes the referendum and the Ryanair “Brexit special” which allows overseas voters to fly home to vote in the referendum on 23 June. Though the ad has received criticism from Brexit supporters and there have been concerns it breaches bribery laws, Ryanair sees the move as good publicity in its vocal support of the Brexit, something O’Leary believes “makes for a bloody good story”.
Yet O’leary admitted that the “benefits of the business are transformed” by listening and responding to what customers want it to do:
“If I’d only known being nice to customers was so good for our business, I’d have done it years ago. I’m genuinely surprised that customers have responded in this way. They have enjoyed the first two years of AGB and declining airfares. They are getting the better service at lower prices,” he concluded.
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