BA’s oneworld alliance partner Finnair has introduced a new range of ticket options, supposedly “addressing the increasing trend for personalisation of the travel experience”.
“Customers can choose a ticket for their needs from three ticket types – Light, Classic and Flex – that are available for both Business and Economy Class for all short-haul and most intercontinental journeys. When booking a ticket, customers select the travel class experience they prefer and the level of flexibility for making reservation changes – along with some additional services included in the ticket. The rest of the experience can be tailored with a wide selection of travel extras.”
I want to focus particularly on the new ‘Business Light’ tickets, as it is potentially a very interesting (if certainly not unique) concept.
Are these new ‘Business Light’ fares good value?
Finnair Business Light fares do not include:
- Lounge access
- Any checked bags (it is hand luggage only)
- Any cancellations/changes
- Ability to select seat
- Priority Check In
- Priority Security
- Priority Boarding
You will also earn considerably fewer miles.
I’d be ok with all of the above (even though not being able to use Business Class Check-In, or even board with the other Business Class passengers does seem excessively mean) – if the price was right…
Using a return flight from London (via Helsinki) to Hong Kong as an example, you can see that booking Business Light rather than Business Classic, works out about $350 (£250) cheaper in total (images below show the flights in each direction):
So, given the connections in Helsinki, that works out at about $90 more per flight to get all the things we normally consider to be part of the Business Class experience.
If (like me) you were hoping to bag a serious Business Class bargain by foregoing an allowance for more luggage than you can reasonably carry and lounge access, you’re out of luck.
What’s the real idea here then?
Presumably, it’s a form of ‘price anchoring’. By setting the Classic fares relatively close to the Light fares, people might think that they are getting a good deal by opting for a Classic Fare, which comes with all the ‘extra’ benefits for just a little more money. That helps to distract from the fact that the ticket still costs $2,800.
Do these new fares actually make sense for the airline?
In its current form (and in the current travel environment), I’m struggling to understand why Finnair thinks Business Light at these prices is a good idea.
In ‘normal’ times, maybe the price anchoring theory would pay off. However, with business travel likely to be very slow to come back, there will be plenty of Business Class seats that need filling.
If you are going to introduce a Business Light style option, the obvious play would be to aggressively target leisure flyers who would appreciate the extra onboard comfort, but who would normally book Premium Economy. A lot of PE flyers might well consider paying a little more to fly Business Class, even without the bells and whistles – but they won’t pay what is really just slightly cheaper Business Class fares.
For example, it’s not hard to find DIRECT Premium Economy flights from London to Hong Kong with Virgin for ~$1,100 (£800):
If you could book Business Light with Finnair for a few hundred more, you might be tempted, even with the connection. But, are you really going to pay more than twice as much as the direct Premium Economy flight? Unlikely.
Finnair’s new Business Light fares seem unnecessarily strict and significantly overpriced. That strikes me as the worst of all worlds in the current travel context – alienating any business travellers who have to book the cheapest available Business Class fare, and not providing sufficient incentive for Premium Economy leisure travellers to upgrade…
More generally though, this is a concept that I can actually see working (if done a little differently), and something I’m sure we’ll continue to see more airlines introduce. One of the big questions for the industry over the next 2-3 years is how are they going to fill their Business Class cabins, and these sort of ‘unbundled’ cheaper tickets could definitely play a part.