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How airlines are wooing business travellers

By Shivani Vora, Forbes
Last updated on: August 18, 2007 17:33 IST
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Once upon a time, first class got all the glory. Business class was seen as a middle world between economy and luxury--like purgatory, but with nuts.

But it has evolved, especially recently.

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"In the last year, business class has been transformed into a much more luxurious product," says Edward Plaisted, chief executive of Skytrax, a London-based airline and airport quality ranking firm. "It's an area where airlines are investing a lot of time and money improving and upgrading. What we see now in many business class products is far ahead of what first class was offering 10 years ago."

Why the change? Experts say that the bottom line is behind the increased attention airlines are paying to business class.

"Business class is one of the biggest sources of profit for airlines," explains Aram Gesar, editor of the New York-based AirGuide magazine and, publications for frequent travelers. Research from AirGuide shows that business travelers make up 75 per cent of business class fliers, while affluent leisure travelers make up the remaining 25 per cent.

"The average biz class customer travels six to 12 times year," he says. "So airlines are really looking for customer loyalty. Upgrading their product is the best way to do that."

Revamps 'R' Us
Airlines that have made notable changes recently to their business class include British Airways, American and Air New Zealand. The latter completely overhauled its product and named it Business Premier. It features seats that turn into 7-foot-long lie-flat beds and house a 10.4-inch video screen with nine channels of on-demand entertainment. Passengers dine on brasserie-style cuisine.

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British Airways is rolling out wider and longer 180-degree seats in its business class, dubbed Club World, and American Airlines has new lie-flat beds in its business class cabins as well.

British Airways' and Air New Zealand's amenities are tops, according to Skytrax' just-released annual survey, which ranks the 10 best business class airlines in the world. The survey was conducted from August 2006 to June 2007 and is based on a variety of sources, including online and e-mail passenger interviews, business research groups, travel panel interviews, corporate travel questionnaires and phone interviews.

Ranked No. 1 is Singapore Airlines, which revamped its business class in the last year. In November 2006, the airline debuted a product that beats out any other airline's, according to Plaisted. For starters, the lie-flat seats are 30 inches wide--the roomiest business class seats in the sky--and passengers have 1,004 choices of on-demand entertainment, a significant upgrade from the previous 405.

Other luxuries include Givenchy toiletry kits; full-size pillows and blankets; cuisine designed by Alfred Portale, chef of Gotham Bar & Grill in New York City; and bathrooms that are 50% larger than average airline bathrooms.

Malaysia Airlines, No. 10 last year, has climbed to No. 4. Changes on the ground include a new restaurant in the lounge at Kuala Lumpur airport that has a team of chefs and formal waiter service, uncommon for airport lounges. In the sky, the airline scored high for its comfortable lie-flat seats and its food. Signature dishes include Malaysian satay and black cod. There's a choice of seven kinds of bread.

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Rounding out the top 10 best business class airlines is Etihad Airways, which was established only five years ago in Abu Dhabi and fast became a serious player in the market. Passengers on Etihad get access to a staff that speaks more than 30 languages, an in-flight entertainment system with a 15-inch screen, lie-flat seats and an extensive dining menu with Asian, Continental and Middle Eastern choices.

No US airline made the top 10 list.

"They [US carriers] are behind in product development when it comes to business class," explains Plaisted. He attributes their poor showing to "financial worries they have had since 9/11."

Of course, the new luxuries of business class don't come cheap. According to Harrell Associates, an airline consulting firm in New York City that tracks ticket prices, a one-way business class ticket on a European airline costs an average of $4,808, an increase of 13 per cent from a year ago. Asian airlines price out at $4,625 for a one-way fare, a 15 per cent jump from a year ago.

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Shivani Vora, Forbes

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