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23 Apr 2024, 07:18 [ UTC - 5; DST ]


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 Post subject: Re: Surf Air
PostPosted: 15 Nov 2018, 21:38 
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Username Protected wrote:
Seemed to be a silly concept. This only works with gym memberships and Amazon prime.


Fundamentally, it's not that silly. It gives the operator full predictability with no worrying about ticket sales. Sell X memberships, buy 1 plane. Sell 2X, buy 2 planes. Their initial target was East Coast (NYC - Boston - DC) market, and I was traveling weekly between NY and Boston when they came out, so I was seriously considering a membership before they switched to West Coast.

The problem is the critical mass. There are only so many people who need to travel regularly between point A and point B. You need enough subscribers to be able to serve all the popular locations, and you need to serve all the popular to get enough subscribers.


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 Post subject: Re: Surf Air
PostPosted: 16 Nov 2018, 04:20 
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Username Protected wrote:
Seemed to be a silly concept. This only works with gym memberships and Amazon prime.


Fundamentally, it's not that silly. It gives the operator full predictability with no worrying about ticket sales. Sell X memberships, buy 1 plane. Sell 2X, buy 2 planes. Their initial target was East Coast (NYC - Boston - DC) market, and I was traveling weekly between NY and Boston when they came out, so I was seriously considering a membership before they switched to West Coast.

The problem is the critical mass. There are only so many people who need to travel regularly between point A and point B. You need enough subscribers to be able to serve all the popular locations, and you need to serve all the popular to get enough subscribers.


The math just won't work in aviation.

Just an example: Plane has 8 seats, and you fly it twice a day between A and B. Morning and afternoon round trips, the usual commuting schedule.

Now, you only need 8 people who commute between those points DAILY (yes, they exist), and you are at capacity. And with their price structure, you're making 16000 in revenue (2k/membership/month), but have to pay over 6000 a day in direct operating costs (assuming an 1hr leg).

So you end up making a loss on every flight, and can only make it up in volume.

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 Post subject: Re: Surf Air
PostPosted: 16 Nov 2018, 08:21 
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So you end up making a loss on every flight, and can only make it up in volume.

Except at those prices the company needs it to work exactly like a gym membership - people need to pay and then not use the service. It only works if each plane has the potential to be what, 300% or more overbooked. The problem being, I would imagine, is that at those prices only people who have legitimate frequent travel desires go ahead and make the deal. There must be a happy spot in price/benefit where something like this might work but I surely do not know what it would be.

As far as Amazon Prime - no idea how that works. I certainly feel I get my $100 worth. If only that model could be applied to Surf Air. Maybe they should be trying to carry Amazon packages and passengers.

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 Post subject: Re: Surf Air
PostPosted: 16 Nov 2018, 11:33 
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Username Protected wrote:
As far as Amazon Prime - no idea how that works. I certainly feel I get my $100 worth. If only that model could be applied to Surf Air. Maybe they should be trying to carry Amazon packages and passengers.

Next time you shop on Amazon, find the same exact product without prime option. Then you'll understand how Prime works.
The $100 you pay is just to cover your entry, the shipping is included in price (yes it's highly discounted and averaged, but still included in price) - Amazon upcharges your warehousing fees when you decide to include prime on your products.


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 Post subject: Re: Surf Air
PostPosted: 16 Nov 2018, 21:43 
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Username Protected wrote:
The math just won't work in aviation.

Just an example: Plane has 8 seats, and you fly it twice a day between A and B. Morning and afternoon round trips, the usual commuting schedule.

Now, you only need 8 people who commute between those points DAILY (yes, they exist), and you are at capacity. And with their price structure, you're making 16000 in revenue (2k/membership/month), but have to pay over 6000 a day in direct operating costs (assuming an 1hr leg).

So you end up making a loss on every flight, and can only make it up in volume.


They had safeguards to make sure users don’t hog the planes like this, their “unlimited” plan was anything but unlimited. You could only hold one or two reservations at the time, so you couldn’t book out round trips every day for the month ahead.

Realistically, for your $2,000 membership you could get maybe 2 to 4 flights a month, unless you happen to fly the routes or times no one else wants.


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 Post subject: Re: Surf Air
PostPosted: 17 Nov 2018, 11:52 
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I always thought it was crazy that you couldn't purchase an individual flight if you wanted to. Someone else said there is a finite number of people that have a need for repetitive travel along the routes they fly. But there's lots of people that have a need once in a while. They should have allowed people to buy individual tickets without being a member. I think they started doing that at the very end, but by then it was too late.

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 Post subject: Re: Surf Air
PostPosted: 17 Nov 2018, 16:12 
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Username Protected wrote:
Realistically, for your $2,000 membership you could get maybe 2 to 4 flights a month, unless you happen to fly the routes or times no one else wants.


Which made the service utterly useless for anyone who would have to rely on it. Miss out on a flight two or three times while you are still paying $2000/month and it gets old really quick.

I could see market for a shared ride product involving planes of that size, I don't see how this subscription model would ever make sense for the great majority of users. It's like paying $100 every month for 'unlimited Uber rides' but not being able to book one when you need it.


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 Post subject: Re: Surf Air
PostPosted: 17 Nov 2018, 18:39 
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Username Protected wrote:

They had safeguards to make sure users don’t hog the planes like this, their “unlimited” plan was anything but unlimited. You could only hold one or two reservations at the time, so you couldn’t book out round trips every day for the month ahead.

Realistically, for your $2,000 membership you could get maybe 2 to 4 flights a month, unless you happen to fly the routes or times no one else wants.


The safeguards didn't work well. The way people did it was to book a new flight immediately after landing. There were people who flew every single day.
The low amount of subscribers meant that system worked 99% of the time.


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 Post subject: Re: Surf Air
PostPosted: 17 Nov 2018, 18:41 
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Username Protected wrote:

Which made the service utterly useless for anyone who would have to rely on it. Miss out on a flight two or three times while you are still paying $2000/month and it gets old really quick.



The biggest issue was the fact that it was in Surfs best interest to cancel as many flights as possible, so any excuse they could have and the flight would get cancelled.
It was cheaper for Surf to book an airline ticket to passengers (or in case of "weather", don't do anything) than to actually operate the flights.


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 Post subject: Re: Surf Air
PostPosted: 17 Nov 2018, 18:44 
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Username Protected wrote:
As far as Amazon Prime - no idea how that works. I certainly feel I get my $100 worth. If only that model could be applied to Surf Air. Maybe they should be trying to carry Amazon packages and passengers.

Next time you shop on Amazon, find the same exact product without prime option. Then you'll understand how Prime works.
The $100 you pay is just to cover your entry, the shipping is included in price (yes it's highly discounted and averaged, but still included in price) - Amazon upcharges your warehousing fees when you decide to include prime on your products.


The idea behind Amazon Prime is to convince customers that shipping is a not obstacle to online purchases. Before Prime, customers would wait to accumulate several items before ordering (often finding what they wanted in a store before placing the order). With Prime they will order one small item at a time without worrying about the shipping cost. How the shipping is paid for ceases to be an issue, and consequently sales increase.
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 Post subject: Re: Surf Air
PostPosted: 17 Nov 2018, 18:59 
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I see many people who pay monthly dues to maintain a flying club membership, yet rarely fly. The Pareto principle applies, where a minority of members benefit the most from the collectively reduced cost.
I can see how the founders and investors were persuaded that the idea would work, perhaps with a majority of subscribers paying their membership dues and not using the service. And I can see how the Pareto principle in this case applies in reverse: the majority are using the service. There must be something about the business model that flipped this upside down: perhaps the pricing model needs to be reconsidered, or its because the routes are scheduled, or perhaps even because there’s no pride of ownership (fractional) in the aircraft themselves?

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 Post subject: Re: Surf Air
PostPosted: 19 Nov 2018, 22:18 
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Username Protected wrote:
Which made the service utterly useless for anyone who would have to rely on it. Miss out on a flight two or three times while you are still paying $2000/month and it gets old really quick.

I could see market for a shared ride product involving planes of that size, I don't see how this subscription model would ever make sense for the great majority of users. It's like paying $100 every month for 'unlimited Uber rides' but not being able to book one when you need it.


It depends on how you use it. If you are expecting to be able to go on moment's notice, it isn't going to work most of the time. If live in LA and your monthly usage is "go to a business meeting in SFO next week, then fly away for a weekend in Vegas 3 weeks from now", it should work well, and still save you money over chartering the plane for these two flights.


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 Post subject: Re: Surf Air
PostPosted: 19 Nov 2018, 22:24 
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Username Protected wrote:
The safeguards didn't work well. The way people did it was to book a new flight immediately after landing. There were people who flew every single day.
The low amount of subscribers meant that system worked 99% of the time.


Booking right after landing doesn't help if someone else already booked the seat a week in advance. It's possible to fly every day if you happen to need a low-usage route or unpopular times, but on high-popularity routes you wouldn't be able to do it.

We use similar model in the flying club - you can fly as much as you want, but you can only have limited number of reservations at any given time. It works great in making sure everyone gets to use the plane.


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 Post subject: Re: Surf Air
PostPosted: 20 Nov 2018, 01:14 
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Username Protected wrote:
Booking right after landing doesn't help if someone else already booked the seat a week in advance. It's possible to fly every day if you happen to need a low-usage route or unpopular times, but on high-popularity routes you wouldn't be able to do it.

We use similar model in the flying club - you can fly as much as you want, but you can only have limited number of reservations at any given time. It works great in making sure everyone gets to use the plane.


That's how it was supposed to work in theory.
In practice, nope. It was just a bunch of people who flew almost every day, and the others were the ones who complained they couldn't get on flights when they needed.


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 Post subject: Re: Surf Air
PostPosted: 20 Nov 2018, 11:30 
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Username Protected wrote:
https://www.surfair.com/us/

?? They refer to their third party operators.... Is it just a broker company?


They use to lease or own PC-12's in their California operations. They sold that maybe a year or two ago and went solely to 3rd party operators.


That in itself is not unusual. Take a look at the relationship between the Majors and the Regionals.
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