As a loyal Southwest frequent flier, I'm not going to lie. When I got the email that they were eliminating their "bags fly free" policy for everyone, I thought it was an April Fools email that had been incorrectly scheduled.
But we all know by now that it was, in fact, not an April Fools joke gone wrong.
What's difficult to understand is how Southwest would forget something taught in Marketing 101: keeping your current customers happy is WAY cheaper than constantly chasing new ones.
Let me emphasize that again—keeping your current customers happy is WAY cheaper than constantly chasing new ones.
Future MBA marketing students will likely study this decision as a classic misstep. From a dollars-and-cents view, Southwest's move simply doesn't add up. They spent years on marketing and advertising to position themselves as the differentiator when it came to who you chose to fly with. Now, they will spend more to attract new customers while actively alienating their loyal fan base.
I can't make it make any sense.
Anyone with a spreadsheet and knowledge of marketing basics will tell you that this is a losing formula in the long run.
If you're looking for advice on marketing and handling a PR challenge, do not follow Southwest's lead.
Southwest's brand, built over all these years, isn't some magical money tree you can keep harvesting while giving customers less and less value. Those of us without credit cards are likely to take our business elsewhere now.
There's a valuable learning opportunity here: when companies with fierce customer loyalty abandon every differentiator they've had in the marketplace for decades—giving it all up to play like everyone else just to make investors more money—customer acquisition inevitably becomes harder, and competitors will quickly jump into the gap that opens.
The moral of the story is clear: don't be like Southwest. Stick to YOUR roots. Stay DIFFERENT.