Not so long ago, there were two types of airlines.

There were the ‘no-frills’, ‘low-cost’ airlines, where groups of people gathered at the boarding gate half expecting a starting gun to go off, and where boarding would begin at the speed of the 100m Finals at the Olympics.

You’d run for the plane (a true fitness test if there ever was one), arrive out of breath and already tired, only to find somebody lying across three or more seats, reserving them for the friends who weren’t quite the athletic ability of Usain Bolt.

Then there were the other airlines – everybody from British Airways to Virgin Atlantic – all with the proportional luxury of reserved seating at check-in and a meal when you were up in the air – perhaps the equivalent of “Upper Class Economy” in comparison to ‘no-frills’.

But nowadays, you’d be hard-pressed to find the ‘low-cost’ airlines of the past. Sure, they exist, but not in their old format.

easyJet and Ryanair, to name two ‘low cost’ airlines, have both spruced up their websites, changed their offerings so that you can now include the bits you want, and revamped their customer service to match that of the long time industry leaders.

What this has led to is an overall win for customers. If you’re dead-set on flying with British Airways for example, you’ll probably have noticed a reduction in at least their economy fares to give the likes of easyJet a run for their money.

If you’d prefer to fly with easyJet, you’ll have noticed that in recent years you no longer have to run for a plane as your seat is reserved. No more is it a choice of trainers or smart shoes for boarding!

All in all, the market leaders have had to adapt to what the ‘low-cost’ airlines are offering by reducing price whilst maintaining quality. Meanwhile, other airlines have had to improve their customer service to attract the lucrative business market and those with higher disposable income.

A similar scenario has played out with retailers in recent years.

The norm was once that the so-called ‘expensive’ Waitrose compared prices to ‘low-cost’ Tesco. Tesco then price-matched against Sainsbury’s, ASDA and Morrisons, and then the cycle began of everybody price-matching each other to ensure the best outcome for the shopper.

Then the ‘no-frills’ discounters began to appear.

The recent recession pushed more shoppers to explore the previously undiscovered marketplaces of Poundland, Aldi, Lidl and other discounters, all of which are currently experiencing a well-publicised boom in popularity.

Quality was never cut at these stores, but people were introduced to brands that they’d never heard of, at costs that couldn’t be matched by the bigger retailers.

More recently though, bigger and more recognised brands have moved into the discounters, attracted by their popularity and growing success. The cycle then begins of more shoppers turning to discounters because of their great offering at low cost. Sound familiar?

It will be interesting to see how discounters fare in the coming years. Will they be a blip like ‘Go’ airlines (ironically owned by British Airways but eventually bought out by easyJet in 2002), or will they be the challengers that are still around in 10 years time, driving costs down and keeping quality high?

As a frequent traveller, I’m rooting for competition and low cost.

Posted by

Jo Errington-Stevens

Date

4th March 2015

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