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Last time we covered Virgin America here on Influx we were unsure if the company would be approved to do business here in the US.  The forces to be presented a slew of roadblocks, and understandably so, Virgin will introduce something new that poses a big threat to the low-priced airline business.  Yesterday they were given the official go ahead from DOE and will begin coast to coast flights this summer.  They will enter the US market with a fresh, new image that will directly challenge Jet Blue and leave Southwest somewhere in-between rundown and a real hassle.The Virgin America brand brings a sexy new experience to the airline industry.  At a time when carriers are taking away pillows and meals and charging their customers for these "luxury" items, Virgin will be stepping in with pimped out planes.  They will  provide customers with a new experience that will be the envy of every flier stuck with an A, B or C boarding pass.  Southwest is scared and they're bracing for the impact by implementing a conservative strategy they hope will reduce their risk. If Virgin America can deliver the basics and then step it up a notch with their entertainment systems, comfortable seats and mood lighting they'll be offering something that makes other airlines look like the poor mans way to fly.

Jet Blue entered the market in 1999 and has been providing a better national flying experience at great prices.  They offered certain perks like a TV at every seat, $25 change fees, less flights requiring connections and great customer service.  In fact Jet Blue built its brand image around being customer friendly in an industry comprised of difficult to deal with people.  This past winter, however, we saw Jet Blue stumble as they struggled to maintain the image it had built after the much reported on ice storm incident.  This raised some eyebrows at the investment to build brands when they are so easily shaken. Some argue that Jet Blue's brand image may not recover; either way it is a timely advantage for Virgin.  

Virgin is surely using its sexy brand image as an advantage and is upping the ante by making onboard cutting edge technology available to all of its passengers.  They will provide movies on demand, modifiable music playlists, in-seat messaging and QWERTY touch-screen consoles w/ games.  Their communications systems will also be state of the art - offering a LAN & WIFI system allowing passengers to have in cabin chats, request food and beverages and create on board chat rooms.  Assuming pricing is comparable, these amenities will be a huge draw that will leave other airlines wishing they hadn't slept around.

Posted by ken fisher