Got Spirit?: Sales at an All-Time High, Quality at an All-Time Low

As summer approaches, most of us are hoping for a summer getaway. Perhaps one of the most stressful aspects of travel is getting to your destination, and with airfare only increasing, cost is often a key factor in making travel decisions. For a penny-pinching traveler, Spirit Airlines is a frequent air carrier of choice, due to its prices that are considerably lower than its competitors. Spirit’s average base fare is around $79, as opposed to a competitor’s base fare, which would be well over $100.

So how is Spirit able to offer fares at such low prices? An important thing to bear in mind when considering Spirit Airlines is that their business model is drastically different than that of Delta, American Airlines, or Southwest Airlines. While those airlines are quality and customer-satisfaction driven, Spirit is driven strictly only by low prices. They have the ability to offer fares at such low prices since they cut out a lot of expenses that other airlines take on in order to offer their passengers a more comfortable and ritzy experience, such as in-flight movies, free refreshments, and ample amounts of space. On a Spirit flight, they have none of the mentioned extras, as well as a more compactly designed plane that is plastered with ads and leaves its customers cramped and crowded. Spirit flights serve one function, getting you from one place to another as cheaply as possible. Spirit has acknowledged the poor quality of their flight experiences, and after over 16,000 customer reviews their flights are rated the poorest quality in the country. However, this does not phase them in the slightest. Spokeswoman, Misty Pinson stated that to the typical Spirit customer, quality is not that huge of an issue, since price is the biggest priority for them. With that in mind, it is clear that Spirit goes after a very specific type of traveler, one who is incredibly price conscious and is willing to sacrifice comfort in order to travel as cheaply as possible. This business model has been working for Spirit. Over the past few years, sales have been steady, and have even increased by 23% in the past quarter. They have also seen an increase in the number of passengers per flight, averaging about an 85% occupancy in 2013 so far.

Though Spirit has been quite blase about their poor reviews, they still express some interest in breaking down the poor public misconceptions about their airline created through bad press. They make it very explicit that it is unhelpful to be grouped with airlines such as American Airlines or Delta, since their business model is completely different and they have a very different focus in terms of their target market.

Do you think Spirit Airline’s business model of sacrificing quality for price is a sustainable one? As a traveler, would you choose Spirit strictly based on price?

Tweet Equity: Social Media in the Workplace Boosts Productivity

Over the past decade, social media has become a hallmark in the realm of communication. Not only has it re-shaped the way in which communication functions on a social level, social media has taken on a new role in the workplace. Social media usage in the office is no longer seen as a distraction for workers and has become a new tool towards productivity and engagement. Instead, these companies have adopted an embracing attitude towards it and have incorporated it into company culture and everyday office life.

To prove this argument, a study was conducted at by Joe Nandhakumar, professor of information systems at the Warwick Business School in the United Kingdom. Over the span of two years, the study monitored the productivity levels at a well-established European telecommunications company that practiced policies that encouraged social media use in the workplace. The results of the study show a clear rise in productivity. This rise can be contributed through the employees’ ability to respond to client and customer concerns in a quick manner, through the use of social outlets and networks such as Facebook or Twitter. Employees were also able to use these outlets to pitch products and ideas and close sales. Nandhakumar also noted that social media allowed for heightened collaboration amongst employees, both within the office and in other locations that may be farther away.

This embrace of social media within the workplace is a major indicator of the definitive changes in corporate culture and the face of business in 2013. Social media has the ability to allow a company to build a distinct culture and identity. Facebook, Twitter, LinkedIn, and Google+ allows businesses to grow a public presence and allow fast and direct communication with its customer base, clients, current and potential employees, and any other interested user. Social media also changes the way in which employees communicate with each other and management. In a time where telecommuting is a very common practice at most companies, networks such as Skype or Google (Hangouts) make it possible to have quick meetings without the need to physically be in the same place. Not only does this boost productivity and cuts down on time, this also has the potential to cut down on travel expenses for companies, since they are afforded with the convenience of virtually conducting a meeting absolutely anywhere. Skype and other video chat outlets have also become commonly used in job interviews, saving time and money for both the employer and the potential employee.

The topic of social media usage in the workplace very distinctly paints a picture of the how business is conducted in 2013. There is an immense embrace of transparency in business that allows for collaboration, growth, and innovation. The corporate use of social media has opened the conversation on many levels.

How do you think the relationship between business and social media will expand in the future?