However, before the airline looks further in different areas where services can be charged for, Ryanair needs to know the customer response to this strategy of charging for online check-ins.
The impact of the economic crisis has hit all the carriers since 2008 which has prompted most low cost carriers to take stringent actions (Dunn, 2009). The low cost carriers thrive on the cost consciousness business passengers as people look for cheaper alternatives. Passengers become price sensitive, according to Ryanair while customer sentiment is focused on value, according to JetBlue. The smaller low cost carriers have closed shop while the larger ones can afford to charge for services, as they are the most sought after during such times.
Airlines have started charging fees for additional baggage, for checked baggage or for bags that are heavy (Kahler, 2009). Ryanair admits that ancillary revenues made up 20% of its revenues in 2008 (Deprez, 2009). Ryanair does not have an impressive customer service record. Ryanair has been charged for fleecing money from its customers. While they may fly passengers even at £ 1, passengers they do not offer refreshments for flight delays and nor do they provide a hotel for flight cancellations (HRIMD, 2007).
Before deciding to charge for ancillary services, an airline has to take into account customer satisfaction, retention and loyalty. There is a difference between perceived quality and satisfaction. Perceived service quality is an attitude, an evaluation whereas satisfaction is a transaction specific measure (Baisya & Sarkar, 2004). Ryanair would have to decide on its objective based on whether they want customers that are ‘satisfied’ with their performance or they want to deliver the maximum level of ‘perceived’ service quality. Customer satisfaction has long-term benefits such as reduced failure costs and enhanced reputation of the airline. Personal service and going out of the way to serve the people in