In 2006, JetBlue removed an entire row of seats:<p><pre><code> JetBlue estimates a net savings of $30 million over five years by removing
six seats from the A320 fleet, as a result of reducing the inflight crewmember
team to three, and by reducing the weight of the aircraft by approximately 904
pounds, which will lower the fuel burn. That figure includes lost revenue
opportunities as a result of selling six fewer seats per A320 flight. The figure
does not include any revenue improvement that may result from the enhanced
JetBlue Experience.
</code></pre>
<a href="http://investor.jetblue.com/phoenix.zhtml?c=131045&p=irol-newsArticle&ID=942110&highlight=" rel="nofollow">http://investor.jetblue.com/phoenix.zhtml?c=131045&p=iro...</a>
Not quite. The extra seats only provide additional revenue when the flights would have otherwise been full. From the article, the average flight is only 80% full, which means those six extra seats aren't providing any additional revenue.<p>To determine the actual revenue increase from those six extra seats, we would have to know how frequently flights have less than 6 empty seats.
In addition to the sketchy mathematical foundation, there's another reason to not draw too many conclusions from this observation: your company, product, and customers are probably quite unlike Southwest Airlines. For starters, airline customers care almost exclusively about price.<p>Joel Spolsky was wise to warn <i>against</i> doing what this article suggests (<a href="http://www.joelonsoftware.com/items/2007/09/11.html" rel="nofollow">http://www.joelonsoftware.com/items/2007/09/11.html</a>):<p><pre><code> In one of Gerald Weinberg's books, probably The Secrets of Consulting,
there's the apocryphal story of the giant multinational hamburger chain
where some bright MBA figured out that eliminating just three sesame
seeds from a sesame-seed bun would be completely unnoticeable by anyone
yet would save the company $126,000 per year. So they do it, and time
passes, and another bushy-tailed MBA comes along, and does another study,
and concludes that removing another five sesame seeds wouldn't hurt
either, and would save even more money, and so on and so forth, every
year or two, the new management trainee looking for ways to save money
proposes removing a sesame seed or two, until eventually, they're
shipping hamburger buns with exactly three sesame seeds artfully arranged
in a triangle, and nobody buys their hamburgers any more.</code></pre>
>implying the flights stayed 80% full after new seats were added<p>>implying decreased customer satisfaction didn't hurt their revenue<p>>implying their systems didn't need to scale because of increased customers<p>>implying their R&D on smaller legroom didn't cost anything<p>>implying upgrading planes didn't cost anything<p>>implying more customers on planes didn't have an impact on maintenance costs<p>>implying revenue means anything when you don't know the profit margins
If flights are at 80% capacity adding 6 extra seats just means an extra 6 empty seats on every flight. The $733 million number is meaningless - what is actually needed is to know how many post-reconfiguration flights had 5 or fewer free seats, since that is the only situation in which the extra capacity is being used.
I feel like saying "a single inch" like it's a pittance when we're talking about airplane legroom is a bit silly. Sure, it seems small compared to the other 31 inches, but that's not a fair comparison, because most of those 31 inches are non negotiable.<p>Realistically, we're talking about at least a 5% reduction in leg room, and that's nothing to sneeze at.
> <i>That means, every year that single inch earns them $773,074,040 of additional revenue. I guess every little bit really does count.</i><p>This does not. There are so many intangibles here, that the conclusion drawn is very ill-conceived. Here's a list of things that can affect this number:<p>1. The amount of customers lost due to restrictive seats<p>2. The negative PR which will result from the change<p>3. The impact on flight price that the company may change after said PR<p>4. Is the data from all of those references accurate?<p>The list goes on and on...<p>It's a nice thought, but there's much smarter people with access to more precise information that draw these conclusions <i>within</i> the company. Enterprise businesses aren't as dumb as we all may think they are.
I've been underestimating the size of the airline industry. I have a hard time reconciling the fact that the airlines always seem to be on the verge of bankruptcy with numbers this big -- $90+ billion a year in just passenger revenue.
My girlfriends father is a pilot for southwest. For my birthday we flew home with my pregnant sister, we of course flew standby. On the way back, my sister and I were separated in Phoenix, where she ended up getting stuck for the night because every flight after 11am was booked. What I'm saying is that although they were able to add more seats, they still can't give everyone a seat, and to southwest that's money lost, and to me, that's one frightened sister.<p>Although I enjoy my legroom, it was hell trying to get my sister home.
I don't know the economics of airlines, nor travel that much, but I can't believe there isn't a niche for an airline that features a reasonable amount of legroom at a reasonably higher cost. Something above the "cattle pen with wings" that people seem to have to put up with.
UKs Ryan Air was even proposing ideas of having people stand during flights (yep, its really that ridicolous) and letting people pay to use the lavatories...<p>Not that they would get through with that but still, they are searching for every inch to make more money.
If they came up with a way to run at 90% capacity instead of 80%, I wonder how many seats they could remove and how many inches of leg room could be gained.
Nice! When you account simple changes like this, it's amazing just due to the massive improvement. I could just imagine the saving for Walmart if they followed Ikea's model with doing away with plastic bags.