We Fixed It, You're Welcome - Fixing Spirit Airlines' Future

Episode Date: December 23, 2024

In the debut episode of "We Fixed It, You're Welcome," host Aaron Wolpoff and his panel of experts, Chino Nnadi, Melissa Eaton, and Peter Braunz, tackle the challenges facing Spirit Airlines. They explore Spirit's recent Chapter 11 filing and its implications. The discussion covers Spirit's history, its ultra-low-cost model, and the potential for rebranding and restructuring. The panel debates the viability of Spirit's new four-tier pricing strategy and the importance of building a community-focused brand. The team offers creative ideas for Spirit's path forward, emphasizing the need for a strong cultural and customer-centric approach. Spirit Airlines: A Brief History and Current Challenges Aaron provides a historical overview of Spirit Airlines, highlighting its evolution from Clippert Trucking Company to its current brand. Discussion of Spirit's financial struggles, including its Chapter 11 filing and failed merger attempts with Frontier and JetBlue. Panel Discussion: Spirit Airlines' Current State Peter Braunz discusses the impact of macroeconomic forces on Spirit's ultra-low-cost model and the challenges of oversaturation in the airline market. Melissa Eaton questions Spirit's long-term financial sustainability and potential merger opportunities. Chino Nnadi emphasizes the importance of rebranding and customer experience in Spirit's recovery strategy. Rebranding and Marketing Strategies Melissa suggests Spirit could lean into its budget reputation with viral marketing, embracing its identity with humor and transparency. Aaron proposes building a community around Spirit's frugal brand, creating a sense of belonging among like-minded travelers. Employee Engagement and Retention Chino highlights the need for Spirit to focus on employee retention and morale amidst financial uncertainty. Melissa and Chino discuss creative ways to engage employees, such as tiered incentives and fostering a supportive work culture. Exploring Spirit's New Pricing Model Peter outlines Spirit's new four-tier pricing structure, from the basic "Go" level to the premium "Go Big" experience. The panel debates the effectiveness of this strategy in attracting customers and competing with other airlines. Final Thoughts and Potential Solutions The panel agrees that while they haven't fully "fixed" Spirit, they offer valuable insights and strategies for the airline's recovery. Suggestions include focusing on customer experience, leveraging community building, and exploring creative marketing tactics. Disclaimer: A quick disclaimer. We are going into this somewhat cold and nothing we say should be construed as legal advice, financial advice or anything that would get us in trouble. These are our views and opinions. We're here to ask the kinds of questions everyone's thinking. Have an engaging conversation and maybe come to some conclusions that we feel are worth exploring. By the end, if we fixed it, you're welcome. All trademarks, IP and brand elements discussed are property of their respective owners. Music by Milo W.Produced by Straight Forward Media Group See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info. Learn more about your ad choices. Visit megaphone.fm/adchoices

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From binge all episodes exclusively on Paramount Plus. Welcome to We Fixed It, you're welcome, the podcast where we look at companies from the outside that have something big happening right now. We jump into the driver's seat, play out different scenarios, give our two cents, and do our best to fix it. We could be right. We could be wrong. We could be way off base.

That's for time to tell. It's like when you're talking to movie characters and telling them what to do or calling out football plays from your living room like you're the coach. Only we're talking about companies everyone knows. And hey, if there's a monumental opportunity or challenge that needs addressing, and we fixed it by the end of the episode, you're welcome. My name's Aaron Walpeth. I've been in the marketing space for 20-something years across big companies, small companies, hypergrowth startups, internal roles, external roles, and across multiple categories. And I still have an endless curiosity about

companies and why they make the decisions that they do. So I'll be chiming in from a marketing perspective. And since this is our first episode ever, we'll go around to introduce our panelists with a quick intro. Hi, everyone. I'm Chino, the founder and CEO of like Capuchino, a global talent consultancy, where we focus on recruitment and D-EIB and people in culture. I am Melissa Eaton, and I'm a seasoned customer experience executive with deep expertise in understanding customer challenges, pain, and tailoring solutions that drive loyalty, retention, and growth. I've led post-sales operations spanning onboarding, escalation, support, retention, overseeing teams of customer success managers and advisors.

My name is Peter Brons. I have a background in finance and technology. In the last eight years, I've been focusing on the intersection of traditional finance and the emerging market of digital assets. All right. Thanks, everybody. We're going to get into it. Before we start, though, I have to throw out a quick disclaimer. And that is to not take our advice at face value. We are going into this somewhat cold in every episode. And nothing we say should be construed as legal advice or financial. advice or anything that would get us into trouble. These are our views and opinions, and we're here to ask the kind of questions that everyone's thinking about. We want to have an engaging conversation, maybe come to some conclusions that we think are worth exploring. All trademarks, IP, and brand elements

discussed are property of their respective owners. Okay, so today we're here to talk about Spirit Airlines. Each episode, one of our esteemed panelists, this time me, will give a brief rundown about the company we're discussing and why we're getting in the cage with them, as it were, and what we're here to fix before we do that. Does anyone have any little stories or anecdotes about your first encounter with Spirit Airlines? I've used them recently, actually, Aaron. I've been traveling quite a bit regionally between San Diego and Las Vegas, and they are but one option.

And being that we have ground rules here, I would say my best takeaway here is I did survive the experience. So yeah. I'll say I used that. Go ahead. Now, I was going to say, I think my first experience with Spirit, not necessarily as a customer, but just having knowledge about the brand was really when there was a lot of business travel, and still there is, obviously, but that it was talked about like the commuter airline, right? And I used to do this in the California market where I would get on Southwest, and this is before Southwest went all over as well.

But the idea of the commuter market where I'm getting on the flight at 7 a.m. flying down for a 45-minute flight. I don't have luggage. All I have is my laptop and my briefcase, and I'm on my way to my accounts. Then I'm coming back and getting on the flight at 4 for 30, and it's the same group of people, you know. And it's, you know, the Thursday afternoon,

this is what we're doing. We're all headed down to Irvine, and we're coming back up to San Francisco. So that kind of thing. Yeah, and I remember hearing about Ryanair and the European options and the short hops and thinking back in the day, why don't we have those here?

being a little bit envious. And eventually I did take a Spirit flight. I grabbed the backpack like you were saying and went to New Orleans and back and yeah, got me there. Well, let's talk a little bit about, we'll talk about why we're here and what we're talking about. In order to do that, let's rewind a little bit and give a quick summary based on always dependable web research. So Spirit Airlines started in 1964. They were originally named Clipper Trucking Company, which is a terrible name for an airline. After a decade, they were renamed ground air transfer ink, and by the 80s, they went by Charter 1 Airlines. They didn't adopt the Spirit name until 1992. They expanded their roots, and by 2007 to 2010, they had a lot of

the features that we've come to associate with Spirit Airlines now. So there's new and clever approaches to seat upgrade fees, branded advertisements everywhere, and also being the first major stateside airline to charge for carry-on luggage. And just 10 years ago, so 2014, they were named by Morgan Stanley as the top airline growth pick for investors. So that's, you know, 10 short years ago. Fortunes did start to change around COVID. And without a profitable quarter since 2019, they've been trying other avenues like a merger with frontier airlines. And then JetBlue.

And then the JetBlue deal was shut down earlier this year for being anti-competitive. And then it recently became official that the merger with Frontier would not go through. And Spirit found themselves in Chapter 11, which was not the plan. However, they do have a plan that they're calling Project Brom. And that involves a bondholder renegotiation and a strategic realignment. But just because they have a plan doesn't mean it's the only way forward because we might have our own vision for what Spirit should do next. So let's crack it open.

What do you think is happening behind the scenes of Spirit right now? Well, I think one of the things that we can, that I think is important as we kind of get into this conversation is how much the Spirit model has been disrupted by, you know, macro forces that have been kind of beyond their control. If you look back, there seems to be kind of two. of how to regard their ultra low-cost approach prior to 2019, 2020. If you look at some of their costs per available seat mile, it was best in the industry, their available seat mileage growth,

was outstripping almost every major airline. And what we've seen since then is that, you know, air travel was extremely disrupted by the pandemic. And as domestic airlines have come back online, they've kind of oversaturated the market with a lot of seats. So I think this is a story in two parts. I think that the financial aspect of it is extremely interesting. And I think all airlines are kind of facing some of the same mechanisms.

So hard to see how some of what plays are potentially available to spirit. You mentioned the bondholders, Aaron and the restructure there. I think it's going to be tough going. So I think that part of this is absolutely about branding. It's about customer experience. It's about the services. But there are certain unchangeable aspects to your business model. if you have high debt coverage commitments and a couple other things.

And it'll be interesting to see how spirit does going forward. I'm glad you started, Peter, because I think the question really is, what is their goal in terms of financial sustainability long term? So is it going to be reevaluating merging now that there is a new administration coming forward so that they may have another opportunity to go back to JetBlue or Frontier? But if not, if they're going to use this bankruptcy or Chapter 11 to do some resetting of their organization, I think that we all know that that's going to be a very long-term type of strategy that they're going to have to set forward. And that may be something they don't have time for based on what their debt looks like.

I couldn't agree with you more. It's at the table and then we can get off kind of the financial aspect of it because it's probably the least interest. aspect. Most commercial airlines are required to keep about 20% liquidity on hand. And Spirit Airlines is doing about $5 billion a year right now. So with easy math, assuming that their cash position needs to, you know, stay in the $1 billion range. We've seen estimates of the Chapter 11 liquidation plan, and they're hoping to attain about $850 million of cash on the balance sheet by middle of 2025, that's still barely getting the job done. So looking at that, it's clear that if they change their business model, they're going to, they don't have a long runway here. They literally have

somewhere between six and 12 months in order to show that the business model is fruitful in order to, you know, retain the, the different metrics that are going to keep regulators happy that are going to pay back to new investors and, and hopefully be on the path to recovery. So I think the question is, what can be done in the next six to 12 months that makes this a viable airline? Because I think that that's just about as much as Spirit has right now. What I think is interesting, Peter, on that point is it's almost, you know, like they need to rebrand. They are known as a budget airline.

But if we have a six to 12 month runway here and we know the cost of air travel is increased, which is why it has become so stripped down in recent years, right? for you to be able to bring two big pieces of luggage. Now it's you bring yourself, maybe your phone, hopefully a charger and that's it. And so with that model being so prevalent, knowing that to bring that revenue up and to build that profit was to bring those add-ons,

how are they going to do that in six to 12 months knowing they are the quote-unquote budget airline? what will be the next strategy there? Are they going to have to completely change their make? Are they going to have to be charging a lot more? You know, that's the question that I think a lot of people are wondering, especially current travelers, where we're also in the middle of holiday season, where there's a lot of upcoming travel where they've announced this just a few weeks before the holidays. And so I'm very curious to see what's going to happen in this time, because this will be arguably, their busy season. So if it doesn't start now, when will it? Yeah, I'm curious to ask Aaron your opinion from a marketing perspective on rebranding or even leaning in. Like, you know, these viral moments?

Like, so these, you know, cheap airfares and things like that. And they've had problems. So, like, I don't know that they're going to be able to, like, rebrand to be affordable with integrity, so to speak, right? But what if they were to lean? in and go viral on like we know we're the cheapest and this is why and like kind of like share the tweets of like all the quote unquote cheap things that happen like if you want wine don't come on our airline you know certain things like that you know where they're kind of making fun of

themselves but making it viral because that might I just I just don't understand from a marketing perspective how they're going to be able to kind of turn it to Chino's you know questions how do you turn that so quickly. Yeah, well, I totally agree, Melissa, and it can start to get executional pretty quick. But I do think what the ship that needs to happen is going from a commodity to a community, right? So, you know, as opposed to that's the default economic option. Maybe I'm choosing that. You know, like you said, Melissa, I, that matches how I live. That matches, I'm frugal, okay, deal with it. I found my people and I do think there's something. And I want to talk more about it, but there's maybe something tribal, right, that could happen where if you're one of us, you know, you, you laugh at the finer things or there's a time and place for it.

But when you're here, you know what you're getting. And we're going to celebrate that, not just, you know, and not that they are apologetic about it, but it's not what you don't have. It's celebrate what this is, right? And build a tribe in a community from that perspective. Aaron, I really like that point, too, when you look at community, because the other piece of this with any air travel is the customer service, right? Right now they just filed for Chapter 11 in the middle of holiday season. Everybody is wondering, well, what's going to happen to our tickets? What's going to happen to our customer experience?

And the trouble is for those employees, they're worried that they're going to be furloughed or they won't have a job in six to 12 months. And so I think it's going to be very important for Spirit to think about how do we incentivize and motivate our team and keep up that morale in lieu of this news. And, you know, what's interesting about this as well, prior to them filing for Chapter 11, their CEO, Ted Christie, received a $3.8 million retention bonus right before this happened. And so for those that are there who are worried about their job security, how I think a really important question is figuring out how to motivate these employees and the team while they're there to build that sense of community, right, so that we can make those viral moments. And so I'm curious to think or to hear your perspective on the people side of things. Well, you know, I want to know what you think. What do they do? You know, they've got six months to get employees on board, preserve maybe what they have, right, attract new talent and new life and energy.

What is at leadership level? What do they do? Yeah, it's a really good question. And I think, you know, it's going to be a challenge to attract new talent. But I think it's looking at the talent that you have. The best recruitment strategy that you can possibly have is retention. And so you know that there's a subset of people who know the spirit brand, who'd be working with the company for years, and you want to look at those folks that are high performers. The reality is there are likely going to be a lot of layoffs happening, like most markets, most companies, sadly in 2024, that is how the market is.

But as leaders, you want to look at those high performers to see how can we retain them in a really sticky situation. Is there opportunities and possibilities for performance, you know, they don't have much money, but are they able to incentivize them with, you know, more air travel, education, promotions even, knowing that they're going to have to lighten the load on the team? Well, I think looking at ways in which you can have the employee base engaged and accountable. And I think that's one of the things that you see with some of these other airlines. where, for example, the best service is provided, you know, kind of in that face-to-face, you know, not maybe physically, but face-to-face space, where the person feels like they have the

bandwidth and the accountability and the support from the leaders to make a call, to make it better. So if it meant giving somebody a water without having to charge them, then, you know, that might be what they need to do. But, you know, I think you bring up a really good point around what needs to be done for the team and all of the employees there that are really, you know, just making spirit what it has been and providing the narrative and the story of what success looks like. What are they trying to get? And again, it kind of goes back to the first question I asked Peter is like, what do we think their goal is for this. And if they can all rally around this common goal and objective, I think that will be helpful and to see how they connect to that. I think the other thing is to

see that bankruptcy is not, or Chapter 11 is not an end. It's a reset. And utilizing other examples, United Airlines, for example, okay, they file Chapter 11 too, right? Other airlines, American file chapter. So like understanding what has happened with those airlines and how they've come out of it and what it means to file chapter 11 because I think, Chino, it's you and I, the same thing. I think all of us here feel the same way is that the first question is what about me, right? When you hear an announcement like that. And so it's up to the executive team.

It's up to the people team and the change advocates. and I don't know if they have a PMO office or a change office, you know, that can really help kind of create that narrative so that they can get those folks on board, their teams on board, because there's no way they'll be successful without having that. It's my opinion. It's just, it's so hard. I mean, you have to hand it to the, to the employees at Spirit, what that must be, feel like, you know, They've lost the last five years.

They've lost, the airlines lost the cumulative $2 billion. Perhaps they have some exposure in their employee stock option program where they're going to be wiped out by this Chapter 11 restructure. I mean, it's difficult. This is a business model that's on the ropes. And so to try to, you know, culture your way out of it, that's a hard, that's a hard, a hard go. So it just your hearts go out to everybody there. They're already starting to furlough pilots and different, uh, stewards, it's going to be a tough go, I think culturally. I don't know if it's, if retraining or anything around

that or opportunities or trying to do a grassroots kind of level gets it done. It's there's going to be I think great cultures can spring out of, you know, hard times. Absolutely. It's particularly ruthless in the airline industry. Yeah, it's going to be, it's going to be a tough go. I had one thought in around that a little bit. You've seen, Aaron, you've seen the proposed business. plan to get out of kind of the ultra low cost model and put in the four the four different tiers. Maybe we could go through that. Is that going to be enough, you know, from a cultural perspective, from a product perspective? Because the six to 12 month timeline exists no matter what.

They think that they have a plan on the table. They really need to show traction here in that next six to 12 months. Do we think that they can do it based on what they've been talking about? I mean, I think they have to. I think you look across outside the airline industry, across categories, the economy category, you know, economy level tier is getting wiped out across the board, right, and hospitality, in travel tourism and, you know, try to go to, we mentioned Las Vegas earlier, try to go to Las Vegas, anywhere you'd want to stay and get a,

get an economic economy level lodging, right? Fast food and fast casual. All the, what you'd call the introductory or economic level. economy level is getting wiped out across the board or consumers are maybe looking at that and saying, well, if it's if the price, if it costs that much already for the base level and the price differentiation between that and something that will actually enjoy more is is manageable. I can I can I can deal with it. They're going to go up a tier.

So I guess if the, the economy base level is raising up, what does that look like, you know? is that what flying i don't know like what what's the what's the price of entry or it's the new the new playing playing field if that makes sense yeah and really kind of understanding the customer segment that they're focused on because remember when i was mentioning commuters and we were talking about business commuters business commuters are not paying for their tickets right so there so now if i'm a business commuter i'm not going to fly spirit I'm going to fly United or somewhere where I can get a seat and I can, I don't have to, like, worry about it. I can take my laptop and I can take a roller bag and I'm good, right?

And I can also get miles based on the fact that my, from a loyalty program that my, that my business is paying for. So maybe that understanding that like the people that are actually the ones that are trying to fly are the folks that are families or, you know, like trying to make. something affordable that otherwise they wouldn't be able to they'd be driving wherever they're trying to go. So again, I think that like that also when you think about it like the nickel and diming for all the little things, I mean, people get really annoyed. When I was talking about like kind of leaning into that marketing side and the brand, Aaron, I don't know if you saw it, but there was a viral tweet to Southwest Airlines. And so I'm going to kind of put them in the same basket where it was like, we don't want to see that one leg of the flight is $49 when the second leg is $699.

So that's like the low cost, right? You know, like I can fly anywhere. And so it kind of gets to that same point because, you know, when you're trying to go with spirit and then all of a sudden you have like, I have a bag. It's a three-day thing. I want a seat. now I am paying another $49. Now I'm paying, you know, $10 for water, you know, all the things. It's like, Jesus, like, forget it.

You know, I might as well just spend, you know, I just want to spend the, you know, $1.99 for the flight just and not have to worry about all that. So I don't know how they're really going to be able to shift that experience without either just being really transparent and leaning into it and just hoping that they can, you know, may be directed at the right segment of customers to try to sustain them. That's a great point. So let's go through it. So in August, they rolled out this new four-tier pricing structure, right? And this is their master plan, apart from, you know, getting the debt holders to restructure the debt, wiping out the common shareholders and doing everything through chapter 11.

They announced in late August that they were going to, they call it the go big plan. And they've segregated their, they've segregated their all-a-car pricing. and they're doing bundling. So that's exactly what they're doing, Melissa. So maybe we could talk about that a little bit. And I'll go through what each of the levels from a pricing perspective might be and what we can talk about the customer experience a little bit. So the main level is still called go. That is their base level. And what you literally get is you get a personal item. And everybody who's written spirit understands that everything is all a cart. When you want to bring a carry on or if you have to check a bag it's an additional charge so they're keeping the go put like the go level very similar

what their their experience is now and what that looks like is you can bring an eight inch by 14 inch by 18 inch package or personal item so it's basically a purse as long as it fits under the seat in front you give you an idea I looked around this is what you can bring you know you bring anything else and you're going to be charged a lot of baggage fees there are no snacks there are no drinks you're not getting a meal service. The seat, it doesn't recline. It's going to be the smallest kind of legroom in the industry. There is no Wi-Fi. You will not be getting any sort of priority packaging. It is very similar to the Ryanair experience. Then you go up a level and they call it the GoSavvy level. You can either choose to have a carry-on bag or a check bag. And then

you get most of the service is the same. You get upgraded to what's called us a standard seat. And so that's interesting, a little bit more legroom. The next thing is go comfy. This is a new category. It's kind of clever the way they've done it, is if you book one of these seats, what you actually lock in is the middle seat is empty. So imagine all of those times that you're on one of these flights. An airline doesn't have a sign seating,

and the last group has to decide, you know, who gets that dreaded middle seat. There's all sorts of tricks that people do. I've heard the people will look you in the eye and pat on the seat, try and freak you out. So you just kind of keep moving. But here, it's kind of clever, but here Spirit Airlines has actually productized the awkwardness of that middle seat. You can guarantee that your ticket, when you buy the go comfy ticket, then nobody's going to sit in the middle seat. What's also genius about this is you can sell this ticket twice for the same seat. Right.

So you get somebody on the left and somebody on the right who's going to pay for the same go comfy. Also, if you're dealing with a glut of domestic flight seats that are on your airline anyways, it's a really brilliant pricing strategy where you've turned this cost, this kind of structural cost disadvantage into a product that you can sell and you can kind of maximize the utility that you can extract from a user. It's kind of a brilliant, a brilliant play. You're getting your customers to pay for unsold inventory too. That's right.

I mean, that's clever. You have to give Spirit a lot of a lot of, I mean, you could take it to an extreme. Would somebody pay for a whole row? Maybe. Would somebody pay? I would pay for to not sit next to people who cough. Like, that would be something I would pay for. So there's all sorts of things that you can do. In this third tier, go comfy, you do get the snacks and drinks. You do get a priority. And then, of course, you inherit from the second tier, the carry-on bag and the check bag. Finally, the upper echelon is the go big. This is equivalent to most domestic airlines. first class experience. They're going to have larger seats in the front. They're going to have, they're going to have everything you get in tier one, two, and three. Here's the thing that I've learned about spirit though with these comfy seats. The comfy seats don't recline still. So it is domestic. You don't need to necessarily be in a lay flat seat, but you're still scratching the kind of the lowest level of premium luxury that you see on some of the other super

regional airlines. The other aspect that you're getting is these comfy seats are not new. These have already existed on as part of the higher tier seats that you could get on Spirit previously. So it feels like a little bit more around the branding experience and a couple of the other ancillary services. But this is the first time we're seeing Spirit go away from the all-a-cart and actually go into the bundled pricing. And I'm curious, would anybody here actually pay for any of these tiers? Is any of this compelling or would it cause you to second guess whether or not you're going to fly on jet blue or southwest, because this is what they're pinning the turnaround hopes on. Do they have Wi-Fi at all? Or is that not an option? Only if you go

big. If you go big, then they'll give you the Wi-Fi password. But Comfy doesn't get it? Nope. Don't get it in comfy. Because I like the comfy idea. I like the no-middle a lot. Yeah. Nothing says simplicity and a strategic turnaround like four similar options. That are various degrees of economy. So, Peter, is the cost for the go big any different than what it is currently? Or is it, can you tell? Is it a little more? They're looking to price it a little bit closer to kind of the Southwest and the JetBlue experience that you're seeing. I think the people that they're, they're going away from marketing it to, you know, it's not exactly the commuter, although it's probably equivalent with that when you get on a United or a Delta kind of premium class, they're really

trying to steer away from the ultra low cost traveler like the cost conscious traveler and it's kind of you're starting to get that feel where they're going more mainstream and and also that I think the effect that we're seeing with since the pandemic every airline is starting to offer these lower cost seats. There's a there's a glutton domestic and so there's compression in the market where spirit used to be able to compete on cost, you have all of this inventory that's available for some of these standard airlines. And as you know, re-adjusting your, you don't reconfigure your airline for every economic cycle or anything like that. So in reality, spirit has to compete with the product-ties kind of more inclusive services that American Airlines are united has had to offer just by the nature.

Those are structural elements of their product. So it feels a little. you know, a little, like too little too late, but that's what they're trying. So, Chino, are they over-emphasizing the product aspect and not who they are aspect? I think so just because at the end of the day, when we go back to what is the cost of entry at the bare minimum for any air travel, it is all coming down to the same thing, it seems like and I think where spirit is going to make that difference and have a point of difference is looking at the experience a little bit more and looking at the customer a little bit more and going back to Melissa's point of why don't you lean into it if you do if your demographic is the

you know low budget commuter or last minute travel looking for a really good deal lean into that for those people. And I think some of those options that Peter mentioned would be, you know, you don't need the comfy option. But for myself, where, hey, I'm going on a quick trip to go see my family in Ohio and, you know, I'm bringing my husband. I don't know if they're able to bring a dog with that. But that comfy option is a really great option in a time where, especially during the holiday seasons, where it's packed, right? And you do need. a bit of that extra leg room if you're someone who's six three and above and you know the seats already are so compact so there is a market for that but I do think they need to lean in on the

people side of things as well because the products are the products and like peter shared it is something that they've had before and it's they're talking about that a lot more but I think what's going to make the difference is leaning into that branding piece there leaning into the customer service piece as well. So it will be important. You could do something really funny. You could like turn it around on the employees like that whole, the four tiers and have a four tiered break room.

And then they could be like, you know, or and show that and be like, hey, you think that it's, this is, you know, only for everybody else. And, you know, even like, you know, or whatever. But it'd be like, oh, if you, you. You know, if you pick, you know, like go savvy, you get a parking space, you know, at work. Or, you know, you get a chair in the break room, you know, or something like that. You know, I mean, it would be kind of funny to do something like that. I love it.

I love that. That's a really fun retention strategy, right? This is thinking of fun ways to do that. Yeah, and actually getting employees to kind of get in on it. And like, you know, I think that's kind of a cool thing to think about. It's like that they understand that it. It's not ideal, but like for some people, they're willing, you know. You know, you got people who are, I mean, obviously it's still out there.

And to Peter's point, the competitive marketplace and the compression of prices, it's going to be difficult for them any way you cut it. Yeah. Well, that's where I take it back to that idea of building a tribe, right, of like-minded thinkers, like-minded people. because at this point you can say, well, we're not for the economic budget traveler, and we're not necessarily for commuters anymore. You know what I mean? But I don't know that they can afford to say, well, we're going to start cutting off segments of our market and let's go to a smaller pop.

Like, they've got to go bigger and say, we are for everybody. And here's why. And here's how you can join us. Right. And maybe they're still going to, like you said, embrace that four-tiered mentality or that we are discount budget, that that's just how we're going to be. and the like the price of entry of budget is up. But guess what?

You get a little bit more for it. You can choose to get a little bit more than that. And you're going to have, I think maybe what they need to be doing is branding that experience. You know, what is the spirit experience and really put some value behind that? All right. We're being told to wrap it up. So let's go around real quick. Our show is called We Fixed It.

You're Welcome. Did we fix it? Melissa, did we fix it? I don't think we fixed it. But I think we came up with some great. ideas and I think we have some really good points that need to be addressed for them to successfully exit out of Chapter 11. Gina, how about you?

I would agree with Melissa. I don't think that we fixed it 100 percent, but I do think with change in leadership, with a lot of new opportunity for rebranding and looking at their customer segmentation, we've given them some great points to think about to help them in those next next. six to 12 months. Peter, how about you? That's a tough one. This one stumps, I think, is stumping a lot of the B-encounters that are running this airline.

If you can go deeper into the ultra-low-cost segment and you can survive until then, perhaps you can pick up the pieces. I love Melissa's idea earlier about waiting maybe the environment shifted with the new administration and the Department of Justice wouldn't block a frontier or a jet blue merger. That seems to be a great, potentially a great. option, but it's hard for me to see how you get out of this. Some of the airlines in the past, like the Southwest and the Jet Blues that have kind of been able to graduate out of the ultra-cost kind of approach, have done it over a long

period of time with a lot of focus on culture, branding, having a great product. Those are all pieces that Spirit's going to have to build from the ground up. It's a big task ahead of us. And although we talked a little bit earlier about the CEO getting the retention bonus, this is going to take, you're going to, you're going to need to retain the exact. executive leadership or some really qualified industry people, I think, to get to the other side of it. So it's a tough go. I wish them the best. Well, and we talk a little bit about like some of it will be executional. I don't think executions alone are going to solve it or save them. But some thoughts,

maybe they've got a captive audience on every flight. Maybe they do something where it's, they have branded content or they have exclusive, you know, a network or a channel that you can only programming that unfolds in real time that you can only watch on Spirit and if you're there, you're there type of thing. I think live wrestling events would meet their demographic pretty well. Live what? Live wrestling events. Maybe perform, you know, in the aisles.

They got a big hub down in Florida. I think it could work. That could be giving away prizes on a flight, making it sociable, whether that's done through the, you know, through a video monitor or getting in the passengers. and just creating an ambiance, right? And again, maybe it plays off the fact that we're, we are who we are, we're not going to pretend to be anything else. Maybe they set up a lounge in the airport that's the size of a phone booth,

you know, and that's their, that's their customer lounge, right? And just little, little executions to remind the world that, hey, we're not going anywhere. We're reinventing for a good reason. And there is a mentality to what spirit is, what a spirit passenger stands for. And it's beyond just, you know, that point A to Point B, got to pick somebody, pick us type of, you know, type of approach. Love that. Well, good.

Underground community. Yeah, exactly. Maybe even pick your spirit animal when you're creating your profile. Oh, I like that. They could do spirit animal readings. Exactly. Well, just create a vibe, create a community. And again, not alone.

Is that going to do it? No, but it gives you something to jump off on and say, okay, good. we stand for something. Let's do something about it. Well, I hope you've enjoyed this early episode drop of We Fix It. You're welcome. There'll be new episodes to come wherever you get your favorite podcasts and be sure to follow us on social at We Fix It Pod and on the web at we fixed it pod.com. This podcast is produced by Straightforward Media Group, all rights reserved. If you'd like to learn more about how a podcast can help your company establish authority and generate leads, please email us at Eric at Straightforward.

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