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Has Finnair lost the plot with its new ‘Business Light’ tickets?

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Finnair is the latest airline to move to ‘unbundling’ its business class product with the launch of ‘Business Light’ tickets.

You should be very wary of this because you could very easily find yourself booking a discounted ticket which gets you, well, not very much.

‘Unbundling’ is a slightly bizarre concept which doesn’t apply to many other aspects of life.

Finnair Business Light fares

Pret may offer you 50p off a coffee if you bring your own cup. However, many other businesses – such as WeWork – have succeeded by bundling things which were not bundled before. Your WeWork office comes with furniture, signage, cleaning, electricity, high speed internet, free access to meeting rooms, printing and free beer, tea and coffee. You can just turn up and get to work. Unbundling is not a trend happening everywhere else.

How have airlines approached unbundling?

Unbundling CAN work when you separate out aspects of a service and charge a realistic premium for adding them back.

If a service represents a genuine cost to the airline (ie if you can’t use the lounge, the airline saves money, so your ticket is cheaper) and you can add it back at a fair price then people should accept it.

The problems with unbundling business class flights revolve around:

  • the services removed do not justify the small discount in the product price
  • the services removed often save the airline nothing (eg removing priority boarding saves no money – it only impacts where you are in the queue) but do inconvenience passengers
  • the cost of adding the services back is often disproportionately high
  • most importantly, business travel policies often force flyers to take the cheapest fare – and if the cheapest fare is the one with no lounge access, no priority boarding, no priority security, no seat assignment and reduced mileage, you’re stuck

How do Finnair’s new ‘Business Light’ tickets look?

Unsurprisingly, Finnair believes that it is “addressing the increasing trend for personalisation of the travel experience”.

I’m sure you thought the same thing when British Airways removed your free seat assignments.

These are the three fare categories you can now book in Finnair business class:

Finnair business light ticket rules

What is missing with Finnair Business Light’?

It would actually be easier to tell you what is included – ie your seat. That’s about it.

You are NOT getting:

  • access to airport lounges
  • checked baggage (these are Hand Baggage Only long-haul business class tickets)
  • seat selection
  • priority check-in
  • priority security
  • priority boarding
  • your standard amount of frequent flyer miles

The last one is not an issue if you credit your Finnair flight to British Airways Executive Club. However, it is possible that BA may change its rules so that ‘Light’ tickets earn fewer Avios.

It is not clear if oneworld elite members will still receive their standard benefits. If so, most of the benefits above – lounge access, check-in, security, boarding – will come back.

Do I make a huge saving by booking Finnair’s ‘Business Light’ tickets?

Don’t be silly.

Here is some typical pricing from London to Hong Kong via Helsinki. This is for the outbound flight only, ie the outbound half of a return flight:

Finnair business light prices

The saving for losing all of the items listed above is £120, or about 11% vs Business Classic.

I don’t know how many people travel to Hong Kong with just hand baggage, but if you have a suitcase then much of that saving is swallowed immediately.

If you are crediting your flight to Finnair Plus, the reduction in frequent flyer miles earned (3,000 fewer) is costing you £30 of value.

Conclusion

A saving of £120 to remove lounge access and potentially remove free seat selection would not be unreasonable.

I am also in favour of letting passengers, as Luthansa does, upgrade to Business Class for a modest premium on quiet flights but without getting any additional benefits. This is a fair trade off.

Finnair, unfortunately, seems to have gone too far. What benefit does removing priority check-in or priority boarding bring? It still takes the airline the same amount of time to deal with all of the passengers. All it will do is annoy passengers who may have been forced into ‘Business Light’ by their corporate travel department.

The only thing that Finnair seems to have achieved from these changes so far is to generate a large amount of critical coverage online. I’m not sure it is the right way to attract the few business travellers who will be looking to fly long haul premium cabins this Summer.

Comments (81)

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  • Peter Hodson says:

    Would be good to know is oneworld status gets the benefits back. Checkin luggage will be key to this, and a BA no bag ticket does not reinstate

    • Andrew says:

      Finnair economy short haul HBO fares always used to add back in a bag for OW elites so I would imagine that would continue with these fares. Finnair always seems to treat OW elites well – member plus guest get a free drink (including mini bottles of champagne) from the buy-on-board selection when flying short-haul economy (as policy, not at the whim of the CSD like on BA)

      • Alastair says:

        Yes this is true. It doesn’t show properly at online check in too but it will be accepted by check in staff (sometimes with a bit of a faff though)
        BA silver got me more value with Finnair than BA to be honest.

  • TimM says:

    I agree with the main thrust of the article. The reason why all-inclusive hotels are a good business model is that they remove several layers of staffing and management required to operate charging, billing and accounting for each individual item or service every guest consumes or uses. Start unbundling and those layers need to added back in and the total cost is much more than before.

    Start unbundling business class and you will reveal Ryanair underneath whose total fare for a business class-like experience would be far higher, if you were mad enough to try.

    • BuildBackBetter says:

      Hotels are a different case. All inclusive hotels get fixed revenue and the focus turns to cutting costs. Difficult to maintain good service levels when you know you won’t get any additional revenue.

      • The Savage Squirrel says:

        That’s not really the model for all-inclusive though; (at least if the business is wise enough to be planning for the longer term rather than the end of month financial statement only – which I’ll admit many are not). Better facilities, services and guest experience will increase the price that can be charged while still achieving good occupancy by generating demand via positive WOM, positive reviews and repeat visits.

  • BJ says:

    “It would actually be easier to tell you what is included – ie your seat. That’s about it.”

    Ha, the big question is … is it? I am not sure about recent practice but some years ago Finnair were very sneaky with their fares. They sold something that had all the appearances of being a business class ticket but was actually the front row of economy cabin with the business services bundle in. In effect almost a reversal of what is being reported here with unbundling. Thanks for this article, if BA is going to be seasonal to BKK going forward I may need an alternative revenue option. Frankly, I’d be very afraid with these Light fares because in addition to the shortcomings reported here, I imagine I’d be first in line for any downgrades going, or close on heals of award pax. Despite travelling HBO for more than a decade and having PP my inclination would still be to shun these Light fares.

    • BuildBackBetter says:

      Rob missed one. A 3 course meal. Next step would be to remove that and lower the price by £10.

      • DeB20 says:

        Also, passengers to bring their own crockery and cutlery, plus clear up everything after the meal, to reduce interaction with the cabin crew in these viral times. Another £10 gone from cost base, but not necessarily passed on to the passengers as a price decrease.

        Sent this as a suggestion to Finnair on Twitter. Met with stony silence. 😬

  • Mike79 says:

    How does this effect reward flights? Will these translate to ‘classic’ or are they going to be a ‘light’ fare where you need to pay to add stuff to them? If it’s the latter could this now be start of airlines making a case for using a larger number of points to discount a ‘classic’ type of fare whilst if you want a traditional reward ticket you only get a ‘light’ ticket.

  • LEWIS says:

    I’ve never got fuss about priority boarding. I’d rather show up towards the end of boarding when que is gone. If I’m on a flight for multiple hours I do not want to add an extra half an hour on the ground if I can afford it.
    What am I missing because I seem to be in a minority.

    • Chrisasaurus says:

      Overhead locker space

      • LEWIS says:

        Never found that to be an issue in a long haul buisness class flight.

    • mark2 says:

      I agree with you. I am a very infrequent flyer, preferably in BA F on points and would prefer to wait until all of the other passengers have boarded. This particularly applies on the return where limited air bridges can meet that everyone on the lower deck boards through F e.g. Vancouver.

    • Andrew says:

      I like to get on board, get settled in my seat and enjoy a leisurely glass or two of champagne before takeoff – after the stress of the airport and its hordes, it’s the time to finally relax in tranquility and let the journey begin. I particularly like boarding with F when flying long-haul J as a Gold member.

      • John says:

        How is the airport stressful when you have lounge access and fast track everything?

        I don’t find the boarding period tranquil at all. On many airlines if you just spend 30 minutes watching all the economy passengers walking past looking jealous / confused (which also blocks the cabin crew from getting your champagne to you efficiently). Even where boarding is via two doors, all the other J passengers make lots of noise and keep walking up and down and have no sense of their surroundings.

        I prefer leaving the lounge 30 minutes before takeoff (walk times dependent), swanning up to the gate, bypassing the 20 or so economy stragglers and going directly to my seat. There’s always still time for champagne which usually comes just after I’ve put my hand luggage away.

        • Andrew says:

          I suppose the luxury is being able to have the choice – you and I have quite different takes on the same experience, so having the choice about what works best for the individual is nice.

          • Babyg says:

            agreed, having the choice/being able to board whenever you want unimpeded is totally underrated. When i am flying first (sadly not very often) I will always board earlier than if i am flying any other cabin, i do feel like the holiday/trip only truly “starts” when youre fully decamped in first with a glass bubbles

          • Bagoly says:

            Yes, “board without queueing” or “board when you want” is the point.
            In an ideal world “Last to board” has its appeal, but that means either cutting it fine on arriving at gate, which I find stressful, or having to wait at the gate.
            The way to reduce the stress is to have “Board from lounge” as Emirate did/do at LHR T3.

        • Pangolin says:

          I concur. Aegean boards J pax last (group 4) and I like this.

    • The Savage Squirrel says:

      You are correct, outside slightly strange aviation geeks. Priority Boarding makes no sense. Last-one-on boarding would be a better feature!
      Premium Cabins are to make the experience of sitting in a constrained plasticky space within an enclosed metal tube less bad. Nothing more. Unless you are in The Residence or similar uber-uber-premium offerings, the experience (and catering no matter what the cost) will still be considerably less nice than even a very modest local restaurant – or a £29 Travelodge if sleeping – due to the inherent limitations of what you can do on a space and weight constrained plane. I sometimes wonder if people who rave about premium plane food have ever had a non-reheated meal. Maybe not if they eat in chain hotel on-site restaurants the rest of the time :D.

      I have no idea why people would choose to extend their time in this environment (while sitting on the runway so it’s not the experience of flying), but each to their own.

      • Babyg says:

        the problem is there are no modest local restaurants in airports.. so being cocooned away in first, or a qatar qsuite with the family is usually the best place to be given all the available options… IMHO getting settled in means you can relax earlier… but as you say, each to their own

  • J says:

    I was playing around with some dummy bookings the other day, and was quite surprised how often Classic came out cheaper than Light…

    I wonder whether airlines shouldn’t be taking a slightly different approach, especially given corporate travel policies, as the article says. E.g. keep the full fare, but then offer rebates, perhaps in the form of airmiles (to lock in loyalty), to the actual passenger if they are willing to accept a reduction in service or a degree of inconvenience, e.g. by forgoing the lounge or fast track etc. But I suppose it’s all about wanting to be able to advertise the lowest possible fares. Not sure competing on cost is ultimately sustainable (both financially and environmentally) – race to the bottom etc.

    Has there been any market research into the viability of (or recent attempts at) competing on quality rather than cost? The old ‘reassuringly expensive’ / “yes we’re more expensive, but we’re demonstrably better” tack. I guess the vast majority of travellers just want the cheapest fares even if that means poor quality – but maybe not so much in the premium cabins?

    • Memesweeper says:

      +1

      Rebates, or extra miles, for hand luggage only business travellers would seem smart, and would probably equate to a real saving in fuel. Maybe allow folks to forgo the lounge for some sort of extra bonus at busy times. Discounting and gutting the main business product may well drive the business traveller into the arms of your competitors…

      • Alex Sm says:

        It’s like hotels which give you additional “green” loyalty points for not cleaning your room too much

  • The other John says:

    IMO, WeWork is a terrible example when it comes to bundling/unbundling.
    From a company perspective, it is about the “asset-light” approach. That is, it is about running a business without needing to have physical office space. So it isn’t about bundling at all. It is about doing FEWER things in-house, in the hope of doing these things better.

    So WeWork has nothing to do with bundling/unbundling. You work in an office essentially the same as before. It’s just that you do not “produce” the office yourself and put it on your balance sheet. Instead, you are purchasing it through a market transaction.

    • Rob says:

      No, for someone like HFP it is bundling. Regus, for example, historically charged extra for what WW includes.

  • Goldflyer40 says:

    Interestingly it is now the second Oneworld airline which has introduced a Business Light ticket with no lounge access, if I’m not mistaken. Qatar Airways being the first. Is there a trend emerging?

    • AJA says:

      I agree. I thought Qatar also removed lounge access with its “R” class fares. I don’t think it went as far as removing luggage allowances.

      I cannot see the point of doing this unbundling, The lounge and the extra baggage allowance is one of the reasons for paying the premium over economy class. I wonder how many people will actually be foolish enough to take this up?

      The only reason to take this up is if your OW status benefits (lounge and baggage) still apply. It would be a trade off for lower miles and slightly lower cost.

      Will it be a case of this is what you’re offered as a last minute upgrade at the airport?

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