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Flyers are raving about the so-called JetBlue experience. It begins with pricing, which is competitive and doesn't torture consumers with requirements like Saturday-night stays. There are 12 one-way fares from New York City to Orlando, for instance, ranging from $70 to $199. On Delta, by comparison, there are 41 fares between the two cities ranging from $70 to $584. Result: after just one year of operation, JetBlue debuted as No. 2 on the Zagat 2001 customer-satisfaction survey (bested only by Midwest Express). That satisfaction has JetBlue en route to tripling revenue to $300 million and passenger rolls to 3 million this year.
The early accolades wouldn't bother the big airlines if only students and grandmothers were flying JetBlue. But the carrier is pulling in business travelers, the industry's most valuable passengers and the source of up to 50% of its profits. "We were starved for an airline like this," says Christopher Hayes, the chief investment officer at Rulison & Co., a financial firm based in Rochester, N.Y. Hayes, who has lately forgone his frequent-flyer perks on JetBlue rival US Airways, has already flown the newcomer 12 times: "It's hard to compare flying JetBlue to other airlines."
JetBlue's marketing is another radical departure. The carrier aims its product at the frugal yet style-conscious consumer. "We want that 'aspirational' audience," says Gareth Edmondson-Jones, the airline's spokesman and one of many employees who came from Virgin Atlantic. "We see our customers as the same ones who can afford more but shop at Target because their stuff is hip but inexpensive." That kind of thinking drove decisions like JetBlue's choice of leather seats instead of the less expensive cloth. "It's a nicer look, a better feel," says Neeleman, in full salesman mode. "Of course, it's also easier to clean when people puke on it."
Neeleman has raided rivals for employee-focused top executives, including COO Dave Barger, a key part of the team that turned around Continental Airlines. Neeleman lured chief financial officer John Owen from Southwest, "because there is no one else in the world who is better at buying airplanes and running a successful financial operation." For his people person, Neeleman chose the only executive who ever fired him. That was Ann Rhoades, who helped develop the airline industry's happiest employee group at Southwest. But in 1994 she pink-slipped Neeleman after Southwest bought Morris Air, another low-price airline he had started.
Neeleman obsesses over keeping employees happy, and with good reason. Airline watchers say JetBlue's ability to stay union-free is critical to its survival as a low-cost carrier. The industry's labor-relations record is famously toxic. "But if there is anyone who realizes the importance of treating their employees right, it's the management team at JetBlue," says airline analyst Holly Hegeman, the editor of planebusiness.com
Neeleman, who wants to take JetBlue public within two years, is just as obsessed with keeping costs down. Like Southwest, JetBlue flies only one type of aircraft, which keeps a lid on training and maintenance expenses. With flight attendants and even executives like Barger chipping in to help clean the jets even before they have landed, turnaround times average just 35 minutes, as fast as industry leader Southwest.