Following a recipe which screams of common sense, but seems to go overlooked by almost every other group of airline executives, Southwest Airlines (SWA.com) has been able to turn a profit every year, regardless of the economy, all while offering some of the lowest airfares, no hidden fees for bags, and while paying their employees some of the highest wages in the industry.
While most airlines continue to lose money, despite raising air fares, adding hidden fees, slashing services, and reducing wages and benefits from their employees, Southwest Airlines continues to make money by doing exactly the opposite.
The concept is very simple, treat your employees very well, they will in turn treat your customers well, and work harder for the company. As the employees take care of the customers, delivering them the service they expected, they turn them into repeat customers.
The proof: According to the American Customer Satisfaction Index’s annual report on airlines, while overall satisfaction is down, Southwest Airlines (LUV) remained at the top of the list with a score of 81 out of a possible 100, which is a 2.5 percent increase over last year. The next closest competitor was Continental with a score of 64 – a decline of almost 10%.
In keeping with their successful business model Southwest announced a fare sale today that starts at $40 each way and runs until Friday.
The message is clear. Give your customers what they expect for the money they pay, treat your employees with respect and pay them a respectable wage, and in the end you have a company your customers love, and a company your employees will work hard to keep strong and profitable.