Forget about the punitive selling proposition of a Basic Economy fare. Long-haul LCC startup ZIPAIR is ready to sell a Basic Business Class seat. With its inaugural passenger flights between Tokyo and Seoul launching next week the company has a range of products for its two cabins. And while it does not explicitly use the term “Basic Business” that’s precisely what it is selling.
Fare Bundles for Basic Business Class
The company offers four tiers or bundles of services for its Standard and ZIP Full-Flat products. The “Simple” tier is exactly that. It is so simple that it does not include any other services beyond the airfare itself. The three other tiers, Value, Biz and Premium, add additional features to the underlying ticket in an interesting combination of bundles.
A seat assignment is included in all three bundles but from there the offers diverge. A carry-on bag comes with two of the options but not the third. Ditto for a checked bag, though in different pairings. And for an in-flight meal. An amenity kit is also on offer in the Premium bundle.
The pricing of the options and what is included in the bundles also varies. A meal could run anywhere from 1100 to 2500 yen (~USD$10-24), for example. Only the least expensive options are included in the bundle and an upgrade to the more premium meals does not come with a discount. In the ZIP Full-Flat cabin there is only one price point for seats and it is just 300 yen, almost bizarre that it is available as an ancillary fee for so little.
Finally delivering on a long-promised option
The idea of “basic business” is not new. Emirates President Sir Tim Clark suggested that his airline was considering it as far back as 2017. As he explained then, advance seat assignments, meals, lounge access and checked baggage allowance would be separated from the base fare. Even the amenity kit or onboard pajamas might be offered as separate items for purchase rather than as part of the package. It would be a fully unbundled product, akin to what ZIPAIR is selling today.
At that time, however, he noted that the carrier was struggling to get the pricing components right, as component prices are not directly tied to the cost of delivering that service. That disconnect becomes more challenging when trying to figure out the price to charge for a business class meal, for instance. ZIPAIR avoids that challenge by simply bringing the same catering options to all passengers on board. The fancier meal in business class is similarly available to economy class passengers. And ZIPAIR does not have to contend with a staggeringly different drinks selection between the cabins or other, similar legacy differences.
For now this Basic Business option is flying on just one airline that operates a single route twice a week in a highly competitive market. It is not a true revolution of the industry. Yet.
But other airlines have also considered similar moves and the retailing options to separate out the components are far more flexible today. Combine that with the willingness of airlines to throw out the old rule book and try ideas previously dismissed as too different and this could gain traction more broadly.
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