While we are less than a week away from finally knowing more about Joon, the new Air France airline announced at the beginning of the summer, it is time to reflect on its somewhat nebulous positioning, which until now has not been understood by anyone and therefore leaves room for speculation.
The first one concerns the airline’s low-cost positioning. To tell the truth, we at TravelGuys don’t believe it for a second and it’s not the airline’s message either. But because it doesn’t fit into an existing box and is not a premium, Joon finds itself with a label that will require a lot of marketing inventiveness to get rid of.
Joon : not low-cost but realistic cost
The low-cost nature of an airline is assessed in terms of its cost and revenue structure, the service provided being only the consequence. With pilots under Air France conditions, it is difficult to be low-cost, and the status of the cabin crew, although different from that of the parent airline, will not be slavery like that of some well-known airlines.
And honestly, have you ever seen a real low-cost airline offer a business class in a 1-2-1 configuration (i.e. full access) and full-flat seats in long haul? Not credible. And all the more so as this business configuration will be more upmarket than the future 2-2-2 of the “old” Air France A330s, whereas Joon will be using brand new A350s.
On the other hand, we can expect a wide variety of services depending on the fare chosen and we could see sales of “dry” seats without meals or baggage in the hold and “full option” packages coexist (in economy, as it is difficult to imagine in business). An individualized and à la carte service should be expected as a consequence. The targeted clientele positioning, the millenials (in other words the under 25 years old), privileging flexibility, they could thus build customized services.
In any case it will be necessary to succeed in making Joon exist between the Air France premium and the real low-cost transavia…knowing that Joon will operate under Air France codeshare. I can imagine the agents explaining to the customer that it is an AF flight number, but not AF, but that it belongs to AF and that the service is just as good. Or a way to say that the worm is already in the apple: either Joon fails or Joon will be one day swallowed by its parent company…But we’ll talk about that later.
It will be said that by freeing itself from part of the cost structure of the parent company Joon is more realistic-cost and will operate at conditions closer to the reality of the competition which is not necessarilylow-cost. We are also talking about the majors that have succeeded in some of the structural reforms tabooed at Air France and its cumbersome minority shareholder named the State and/or that are located in countries with more advantageous taxation (and no need for a tax haven for that). The objective is not to offer the cheapest tickets on the market but to offer a normal level of service while being profitable on destinations that are not.
The second question that arises is customer positioning. And here Air France shows it: it is a Millenials airline. A very clumsy statement because it puts Joon in an unrealistic box from which it will have to be removed
Joon: a more lifestyle than millennial airline
So of course, there is the medium-haul: but the mere fact of offering a real business in long-haul and targeting the millenials poses a rather obvious problem.
And what is a millennial? Someone who wants flexibility, experience, wifi, services and an end-to-end experience, online? I can introduce you to enough people in their 40s and 50s who have the same expectations to fill entire planes. It’s just a common sense requirement and common sense is pretty well shared among generations except that the older ones may have finally come to their senses while the younger ones have not.
Millenials may have a different expectation of relational posture? I have more faith in it. But then Joon will have to play very tightly: if it cannot fill the plane only with Millenials, if on certain destinations the normal or even premium or business customer will have to give up on Air France to go on Joon, then the airline’s codes must not put them off either. Take your grandmother to the UCPA (a french sport-oriented resort network for originally made for students, which she probably loved in her youth) or your father to the latest youth club…it won’t work.
In this respect, Joon’s challenge will be to attract a certain generation without driving away the others who will consider a priori or by experience that they are not welcome there. Not obvious.
No, Joon is not and cannot afford to be an airline for Millenials. Joon will be more of a lifestyle airlineIt’s for people who, regardless of their age, like a certain lifestyle, a certain type of experience and postures in customer relations. From 20 to 45 years old.
So be careful to get back on track before the Millenials‘ positioning becomes too entrenched in the public’s mind.
All this makes an ideal link with the destinations that Joon should serve. Here again, many names have been mentioned, but the equation to be solved is still complex.
What is a Millenials or lifestyle destination?
There are destinations that are of interest to Air France and those that are of interest to its target.
For Air France there are all those where the airline is not profitable in normal configuration.
We immediately think of the COI destinations (Caribbean-Indian Ocean but also many tourist destinations)that the airline operates with densified, old generation cabins and a degraded service. These cabins are both an attack on the image of the airline (if you have flown COI once, even in business, you won’t do itagain) and even an insult to the French overseas to whom the national airline deliberately offers its worst product. There is no doubt that these destinations will be a good playground for Joon to raise the level of customer experience while lowering costs.
But it is not certain that all Air France’s loss-making routes are destinations of choice for the targeted customers.
Destinations such as Porto, Berlin or Barcelona make sense as long as they do not lose the existing clientele with an offer that is too divisive.
Some of the long-haul destinations mentioned are more open to discussion. Osaka. Why not. Tokyo ? Ridiculous. Montreal is not mentioned but has the right profile.
And we come back to the inconsistency of the Millenial positioning. The sun? Yes, but you still have to have the money. The festive ? Yes, but not only, otherwise you’ll inherit the nickname of Air Party. The cultural? Why wouldn’t young people like to be cultivated?
In short, the millennial is multifaceted, as much a geek as a backpaker as a lover of quality experiences. If we extend this to lifestyle passengers, it feels like squaring the circle? New York ? Is it Joon or Air France? Well, in theory it could be both.
From there to imagine shared destinations with Joon and Air France services… Common sense will tell you that it is relevant on certain destinations, the unions will say no. In any case, making Air France disappear from Japan in favor of Joon would be a monumental mistake with regard to local customers who are fond of the traditional French service.
And a Joon / Transavia coexistence would make even more sense. Joon will be able to attract loyal Air France passengers who shun Transavia which does not allow them to earn miles and does not recognize their status. The passenger will like it but, as usual, his opinion will take second place to that of the many people in this big house who have the power to say no.
Joon: Air France’s W?
The Joon case reminds us of the case of the W hotels. Historically, W was intended to attract young customers who turned their backs on the aging Westin that their parents loved. They were asked what they wanted, specifications were made and hotels were built. The latter, in order to meet the specifications, have found themselves with construction and operating costs such that today they attract 30/45 year olds capable of spending 500 euros on a standard room and still feel young enough in their heads to appreciate the codes of the brand.
A successful repositioning but the bullet was not far away.
Joon will not follow the same trajectory but some common points are still disturbing.
Waiting for the announcements: Joon has potential and a ball and chain on its wings
We will know more next week with the official announcements but we already have some certainties.
Joon is inaugurating a new positioning that makes sense as long as we are clear with the market and relevant to the equation of discourse, target clientele and destination, which, as we have seen, will require some balancing act.
Now we should not expect this initiative to save the airline for two reasons.
The first is the limitation of the number of aircraft conceded to the unions.If Joon does not work, investments will have been made at a loss. If Joon is a success, it will be limitedand will not be enough to give a new dynamic to Air France. It will be a peripheral success with a limited financial impact.
The second is that the reason for Joon’s existence is Air France’s inability to reform itself from the inside. The experience that Joon will offer to its customers should theoretically be the one that a “major” offers. How can we think that flexibility, comfort, quality of the online experience and new postures are the expectations of only a part of the population? And if Joon cannot grow, it will be up to Air France to adopt the codes of its little sister, which will make the existence of Joon de facto useless.
Reform and swallow Joon or let Joon grow even if it means overtaking its parent company? If Joon succeeds, this is the equation (insoluble for the moment) that Air France will have to face. But we are not there yet, we will know next Monday how Joon intends to solve its market equation.
Joon is the airline that allows Air France to buy time but does not allow it to close its eyes to its need to reform.
