China’s anti-corruption drive When is first class not first class? Sep 12th 2014, WHETHER we care to admit it or not, clever marketing and devious branding have an extraordinary ability to influence our decision-making. Foie gras, it is reasonable to assume, would be rather less popular on restaurant menus if denoted more literally as “force-fed bloated goose liver”. So it should come as no surprise that, responding to the Chinese government’s efforts to stamp out corruption, China Southern Airlines has chosen the path of least resistance in adapting its product. Following a sustained campaign by President Xi Jinping to discourage lavish spending on state-funded business trips—a campaign which domestic carriers blame for a sharp fall in profits—the airline has simply re-branded its premium cabin. High-ranking officials can still book the same luxury seats as before on domestic narrowbody flights, but now their expense forms will read “Business”, not “First Class”. The Financial Times summed it up best: “Beijing’s crusade against corruption claimed a linguistic victory on Tuesday when state-owned China Southern Airlines said it would change the name of its first-class cabin to business class, an apparent ploy to win back government officials who are banned from travelling first class in the new Chinese age of austerity.” Needless to say, this is mischievous marketing at its worst. Rather than physically re-designing its product to accommodate shifting demand patterns—as China United Airlines, a subsidiary of China Eastern Airlines, is doing—China Southern seems to be focussing on the letter, not the spirit, of the law. And it is not the only one. In January, the state-run Xinhua news agency reported that 56 of the country’s 680 five-star hotels had requested downgrades, presumably to side-step the austerity drive. Many others had suspended applications for the top ranking. They, like China’s airlines, complain that revenues have been sliding ever since Mr Xi embarked on his entirely commendable anti-corruption campaign. Instead of making substantive changes, hoteliers also seem to favour a superficial, semantic response. Your correspondent must stress that, having never flown China Southern, he cannot pass judgement on its product positioning. It has been suggested on some message boards that the re-branding merely brings the airline in line with its domestic competitors. The first class moniker will still be used on international routes and widebody domestic services, which have vastly superior products that are designed for long-haul travel. China Southern’s narrowbodies do not have flat-bed seats and so, it can be argued, their product falls short of what many would consider true First Class. But this is a semantic distraction. Domestic flights across China’s eastern seaboard last less than four hours, which makes flat-bed seats not just absurdly decadent but also commercially unviable. Better to cram in a few more seats and carry more passengers. Airlines carefully design their on-board products around average flight times, before assigning a class brand relative to the wider marketplace. In many people’s minds, a 44-inch seat pitch with lashings of food and drink on a two-hour flight does indeed qualify as first-class service. Short-haul business travellers around the world have grown accustomed to the thriftiest of seats. There is no reason why China’s government officials cannot do the same.
Posted on: Mon, 15 Sep 2014 00:00:03 +0000
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