Southwest Airlines 2011 Annual Report Download - page 17

Aggressive Promotion of the Company’s Low-Fare Brand and Points of Differentiation from its
Competitors
During 2011, the Company continued to benefit from, and aggressively market, Southwest’s points of
differentiation from its competitors. For example, Southwest continues to be the only major U.S. airline that does
not impose additional fees for first or second checked bags. Through its “Bags Fly Free®” marketing campaign,
Southwest has continued to aggressively promote this point of differentiation from its competitors. The Company
believes its decision not to charge for first and second checked bags on Southwest, as reinforced by the
Company’s related marketing campaign, has driven an increase in Southwest’s market share and a resulting
increase in revenues.
Southwest is also the only major U.S. airline that does not impose a fee for a Customer’s change in flight
plans. In January 2011, the Company introduced a marketing campaign to promote this point of differentiation
between Southwest and its competitors. The campaign highlights the importance to Southwest of Customer
Service by showing that Southwest understands plans can change and therefore does not charge a change
fee. While a Customer may pay a difference in airfare, the Customer will not be charged a change fee on top of
any difference in airfare.
Also unlike most of its competitors, Southwest does not impose additional fees for items such as seat
selection, fuel surcharges, snacks, curb-side checkin, and telephone reservations. In addition, Southwest allows
each ticketed Customer to check one stroller and one car seat free of charge, in addition to the two free checked
bags.
Business Traveler Amenities
Southwest offers several products that have been designed to attract additional business/full fare travelers.
Business Select. As discussed above, Southwest’s “Business Select” product includes perks such as
priority boarding, a higher frequent flyer point multiplier than other Southwest fares, priority ticket counter
and security checkpoint access in select airports, and one complimentary adult beverage coupon for the day
of travel (for Customers of legal drinking age).
“Fly By” Priority Lanes. Southwest provides Fly By Priority Lane access for its Business Select
Customers and Rapid Rewards A-List Members at many of its airports. Fly By Priority Lanes are priority
access lanes located at select ticket counters and security checkpoints. The lanes allow Business Select
Customers and Rapid Rewards A-List Members direct access to the front of the line at the ticket counter
and/or security checkpoint. As of December 31, 2011, Fly By Priority Lane Access was available at 56
airports.
SWABIZ. SWABIZ is Southwest’s business travel reservation web page. SWABIZ allows business
travelers to plan, book, and purchase Ticketless Travel on Southwest and to efficiently obtain their lowest
fares and maximum frequent flyer credit.
In addition, as discussed below under “Inflight Internet Connectivity,” Southwest has continued to install
equipment on its fleet to provide WiFi connectivity.
AirTran currently offers Business Class on every flight; however the Company has stated that it intends,
upon full integration of AirTran, to have a consistent all-coach product offering.
Ancillary Services and Fees
During 2011, the Company continued to experience revenue benefits from service offerings such as
Southwest’s EarlyBird Check-in™ and Pets Are Welcome on Southwest (PAWS) products. EarlyBird Check-in
allows Customers to obtain an early boarding position directly behind Business Select and A-List Customers by
adding an additional $10 to the price of a one-way fare (priority boarding privileges are already included in the
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