Ryanair has warned that its profit is ready to fall for the primary time in five years because it continues to overtake its customer support in a bid to enhance the brand’s image.
The airline says that increased competition within the European market will push average fares down by around 10 per cent over the winter. That has caused Ryanair to chop its profit forecast for the second one time in two months for the year to March from €570m to €510m, below the €569m it made last year.
The figures come because the airline aims to enhance its reputation for poor customer support. It has announced quite a few updates including a cut in baggage fees, a redesigned website geared toward making it easier to book tickets and a “My Ryanair” member service.
The latest change will see Ryanair shift to totally allocated seating on its flights. Customers that desire to reserve “popular” seats, along with those inside the front row, might be ready to pay €5 to take action, so long as they check-in additional than 24 hours before departure.
Ryanair says: “Our decision to launch fully allocated seating is a part of the airline’s commitment to hear its customers and improve its industry leading customer support.”
Ryanair faced growing criticism from both customers and shareholders over its poor customer support. While previously this didn’t worry the firm as a result of its strong growth, increased competition, both profit warnings and a prediction that there’ll be a “pause” in traffic growth over the subsequent 365 days means it now must improve brand perceptions.
Ryanair currently languishes on the bottom of virtually every metric on YouGov’s BrandIndex, from reputation and satisfaction through to impression and quality. It also came in last through which?’s customer support survey, performing the worst out of the UK’s 100 biggest brands.
The customer support changes tend to affect Ryanair’s final analysis as ancillary revenues from baggage fees and boarding pass re-issue penalties are significant for Ryanair. However, the firm says these don’t have an important impact on its current fiscal year.
For the 1st 1/2 the year, Ryanair’s profit hit a record €602m as a 2 per cent fall in average fare price was offset by a 22 per cent rise in extra charges. Traffic was up 2 per cent to 49 million passengers.