After vice president and chief marketing officer Kevin Krone retired in February, Southwest Airlines moved corporate sales to a new business function led by
managing director of business development Dave
Harvey, who previously led network and capacity
planning. He told Travel Procurement the purpose
of the new group is to find growth opportunities,
one of those being corporate sales.
BTN: Southwest has always taken a differ-
ent approach from its competitors when it comes
to corporate sales. Do you plan to continue that?
Harvey: Our primary focus is still going to be direct sales,
and we want to have that direct relationship. We’ve got corporate customers who have a lot of different needs, so we
want to support them through third-party, through unique
contracts and deals. We have to be nimble and make sure
we’re changing with the needs of the business and the technological needs of the business, so that will be a big part of
our future road map.
As we look out at how our network has continued to
evolve, we’re truly a national carrier. We’ve done a lot of neat
things when you look at our presence in Washington Reagan and LaGuardia and the expansion out of [Dallas] Love
Field. We’ve built a strong presence in places like Atlanta
and Denver, and now you have international behind the
network, which takes us into that full-network space, which
we can leverage to win a lot more of the corporate business,
something we’ve done well at but haven’t put a ton of investment in compared with other corporate initiatives.
BTN: Do your selling points differ from other airlines’?
Harvey: When we think about the corporate business: bags
to a lesser degree, but no change fees is something that resonates. I think about our all-Boeing fleet and how easy our
business policies are for that corporate customer to make
changes last minute and be flexible based on the needs of
their day. Those things that are attractive, we hear about
them over and over again, so we want to keep playing to
that strength as we continue to grow this line of business.
Harvey: Our tried and true is direct, so we have products
like Swabiz [online corporate booking tool] that do great
for us. We have a lot of direct linkages and direct connects
that will always be our primary focus. We’re a low-cost
carrier and want to have that direct relationship.
BTN: Do you expect your corporate/leisure mix to
Harvey: We’ve got very healthy growth. We grew our overall
business last year 7. 3 percent. We’re going to be in the 5 to
6 percent range this year. We still have to finalize overall growth
plans. It would still be in line. We’re not seeing an explosive
growth of 20 percent that’s biased towards leisure. We are seeing overall demand on the corporate side outstripping our total
growth rate, and that’s just a function of the new markets we’ve
added, putting more investment and focus in winning corporate business. We’re excited to see that trend continue.
BTN: You also mentioned international flights and
their place in Southwest’s trajectory. What are
Harvey: Last year was more about the international space
as we were building our gateway primarily out of Houston Hobby. We added two to Costa Rica—San Jose and
Liberia—and we also brought online Belize City and
Puerto Vallarta, Mexico. We’re excited this summer to start
service to Long Beach, so we’ll have all five of the major
[Los Angeles Basin] airports [with] LAX, Ontario, Burbank and Orange County. We’re in the thick of it with Cuba
[applications]. All of that final justification went to the [U.S.
Department of Transportation on March 21], so we expect
a few weeks for the DOT to sort through it. We [requested]
not only Havana but also two of the leisure destinations,
Varadero and Santa Clara. Those four cities would take
us from 97 to 101 cities by the end of 2016, and then we
also have a new gateway with Fort Lauderdale-Hollywood
International Airport coming online midyear 2017 that will
have some exciting destinations tied to it.
Dave Harvey on Southwest’s
New Focus on Corporate Sales