Secrets of Airline Catering

Here's how Alaska and Air Canada use food and beverage as a differentiator to get passengers to pay more for tickets.

Dear readers,

When Oscar Munoz took over United in 2015, the new CEO prioritized coffee. He promised to remove the dreck that many passengers disliked and some flight attendants abhorred (because they had to apologize for it). It stunk compared to the Starbucks-branded brews served before the Continental merger, and Munoz wanted to demonstrate United was making customer-friendly progress with a quick win that passengers would value.

Changing even a single product company-wide for thousands of daily flights around the world isn’t exactly “quick” or simple at all, but United's top executives tapped two up-and-coming managing directors to figure it out — Todd Traynor-Corey in catering, and Mark Nasr in corporate strategy.

They considered five coffees, putting four on a short list. Taste was important, but so was which coffee brand signaled to U.S. customers that United was turning the corner, rather than cheapening out. They opted for Illy, but Nasr told me what they paired with it was as important as finding the new coffee.

“It was the selection of the Stroopwafel to pair with it,” Nasr said. “Our work also identified the lack of a free snack, which is something that we were implementing at the same time. Todd [Traynor-Corey] had the idea to go with a Stroopwafel. Remember at the time, it was very common and well known in Europe, but that delectable treat was not known in the United States broadly at all. I think Todd actually should get credit for introducing the notion of the Stroopwafel to the popular consciousness of America."

We can cite many reasons for United's turnaround. The Stroopwafel arrived at United in 2016, and so did Scott Kirby, who realized United would never win by shrinking itself to better profitability and announced (with gusto) that the airline would win back its "natural share" and modernize how it conducts business. I know that the bones of an airline — network, fleet, and revenue management — are most vital to running a profitable enterprise, but like Munoz, who prioritized culinary improvement, I think food and beverage matters because it sets the tone of what the airline wants to be.

Maybe you don't care (are you a Robert Isom disciple?)¹ but I will pay more to fly an airline that serves name-brand coffee and a tasty European treat, than one that pairs no-name coffee with mystery snacks. Other people will too, as a few North American airlines — Air Canada, United, Delta, and Alaska among them — have shown. These airlines understand that while on-time performance is the biggest driver of customer satisfaction, they don’t have that much control over it. They can’t control the weather or how many front-line employees call in sick, but they can control food (along with working WiFi and happy passenger-flight attendant interactions), and that goes a long way toward helping an airline improve its satisfaction scores.

Getting it right — so people will pay more to fly you — costs a lot of money. But that's not all. The people running the food and beverage operation need to think less like airline executives and more like restaurateurs or hoteliers. They need to understand trends and be ruthless in determining not only what customers want, but also what dishes can be recreated at scale. Traynor-Corey (now the vice president of guest products and experience at Alaska) and Nasr (now the executive vice president of marketing and digital at Air Canada²) are two of the best at this, and it’s more of an art than Stroopwafel meets coffee.

Food and beverage should be part of the brand

A full-service airline can choose food for sustenance, or it can choose food to satisfy a brand promise. Alaska and Air Canada opted for the latter. For Nasr, who oversees every aspect of Air Canada’s product, including technology, the frequent flyer program, and the airport and onboard experience, this is a no-brainer.

“The real opportunity with product isn’t its narrow industry definition,” Nasr said. “Rather, it’s the capital ‘p’ Product — the value proposition is all of your products and services. And the most successful brands are the ones that look at all of those things holistically and plan and activate them together. Everyone loves an Apple example, so here goes: for them it isn't just the hardware, it isn't just the software, it isn't just the services. It's the store, the support, the Genius Bar people, and the website. It’s all of those things together, which become self-reinforcing and stand for what the overall brand is offering.“

Alaska sees it similarly, Traynor-Corey said — his supervision of inflight food and beverage service and lounges falls under marketing on Alaska’s organizational chart, and all of Alaska’s food and beverage decisions need to mesh with its marketing goals.³ Sometimes, that means Traynor-Corey avoids saving money because appearing cheap is not a marketing goal.

"We also are extremely averse to making changes that seem short-sighted," Traynor-Corey said. "I've worked at airlines — and won't name them — where we could reduce the cheese down from an ounce to .75 ounces. Nobody is going to notice, but it'll save us half a million dollars a year. And we could absolutely do stuff like that here at Alaska, but we never would."

To bolster its brand, Alaska likely spends more on the free snacks it gives to passengers,⁴ because it partners with established brands, including Stellar Snacks, with its "mesmerizing packaging" created by "budding artists.” In first class, Alaska also likes to tie its brands with winners, like Salt & Straw ice cream, a popular company with roots in the Pacific Northwest.

"People don’t associate airlines with great food," Traynor-Corey said. "I'm trying to change that perception, and I hope it's working. But if you throw a bag of pretzels in front of somebody and it says ‘Alaska Airlines’ on it, they're probably going to feel like, ‘what is that?’ And is it going to be high quality? Is it going to have a great flavor?"⁵

To protect their brands, Alaska and Air Canada try to over-deliver in premium classes on all flights. Other airlines commonly alter what they serve depending on the market, which makes sense if the important factor is the revenue profile of New York-to-Chicago versus Charlotte-to-Des Moines. The problem with that is that customers don’t know which routes produce the most revenue, and so they would not know if the crappy meal they were served on their last flight was because of the stage length, or the flight’s profitability, or due to a company-wide change.

"For first class, we think long-haul is long-haul, whether you're going to Tampa or New York or Boston," Traynor-Corey said. "We don't play the ‘JFK-to-SFO is higher quality’ [game] or [deserving of] more spend than Portland-to-JFK."

Air Canada has a similar philosophy, Nasr said. “We're the only carrier in the Western world, as far as I'm aware, that offers a hot breakfast in business class on every single flight,” he said, including the 45-minute segment from Toronto to Ottawa. Nasr likes delighting customers on a 6 a.m. flight during a cold Canadian winter with an omelette plus a hot cup of coffee or tea.

Passengers might not say food is particularly high-priority for them, but "it has a halo on the brand, and it shows up in customer satisfaction," Nasr said. "And when you take it away — particularly for flights that are on time where you're delivering the core product — you see it very clearly."

This matters in economy class too. Last year, after Air Canada introduced free booze and light snacks on North America flights, the airline saw a 20 percent year-over-year increase in NPS scores among passengers who had not had a travel disruption, Nasr said.

Sometimes a menu item is more about signaling to customers

We’ve established that very successful premium airlines treat food and beverage as brand vehicles rather than line items. A finer point on that is that it’s a small but significant way for an airline to show passengers they are paying attention to trends and new preferences.

If Alaska can be on-trend — perhaps by addressing a small but growing segment of passengers who now prefer a hopped seltzer over an IPA — the airline calculates its brand could see a boost, even if the items aren't so popular. With more people reducing how much booze they drink, Traynor-Corey said he likes the idea of being early-ish to this trend.

“I think it's also being inclusive and knowing that there are people out there who really enjoy flying, but maybe they're trying to cut back on alcohol for whatever reason, and providing them with an option is really important to them, and it builds loyalty and there's thoughtfulness that people recognize," he said.

Is this this most popular drink on Alaska? I doubt it. Does it show that the airline is on-trend? Absolutely. Photo: Alaska.

Air Canada also has been an early mover on trends, and last year was among the first airlines to begin serving oat milk on board. The airline also likes to move fast on food trends to signal to customers that it changes with the times.

Nasr shared that he read my review of Air France’s La Premiére product, in which I questioned the airline's anachronistic and all-French menu, which (as an American) I did not find accessible. Nasr defended Air France, saying it cultivates its brand in a certain way — as a high-class French airline. But he said Air Canada wants to be a more nimble company, something that he can convey via its menu.

"Not everyone wants a foam of ... pheasant on top of a foie gras, and crab rillette with smoked turkey, which is an actual Air France dish," Nasr said. "As a gourmet, I can understand that. But the Air Canada brand is flexible enough — as silly as it might sound — to serve flatbread pizza in business class, to serve cheeseburgers in economy, and to have baby back ribs with truffle mac and cheese. That's acceptable, and it makes sense, and it's very accessible to a very broad range of people. So yes, Canada might not have the history that France has, but our brand is more accessible. It's more welcoming. I think it's more universally appealing, and there's a ton of commercial opportunity in that."

Air Canada takes menu planning seriously. Photo: Air Canada.

Authenticity matters too

I asked for an interview with Traynor-Corey after I flew Alaska from Washington Dulles to Los Angeles and tried the Impossible meatball curry in first class. It was similar to another Thai curry dish Alaska has sold in economy, but after trying too many bland United curries, I was shocked to discover Alaska's version packed a spicy punch, and I was even more surprised when Traynor-Corey told me this is by design. He wants the food to taste like it should, to be memorable, and he cares less about whether every passenger will want to eat it.

Alaska can take this approach for two reasons. First, customers must pre-order all food in economy and much of it in first class, so the airline gets to pitch the dish to passengers ahead of time and offer more detailed information than a flight attendant working their way down the aisle. And second, it offers choices for all palates, though, to Traynor-Corey’s surprise, Alaska’s Thai curry dish has been just as popular as the pretzel bun sliders served on some transcontinental routes. ⁶

Now here a few more things I found interesting about catering:

• Both Air Canada and Alaska want to serve fish, because the product is so important to the communities they serve. Air Canada has a slick video about the Fogo Island cod it serves in one of its premium lounges, because “as Canada’s flag carrier, we love to champion local products.” Alaska is also big in the fish business, because it flies a lot of salmon from Anchorage. But on the plane, it’s a different story. "Fishes can be really polarizing, and there's just something about it for some people, especially on a plane,” Traynor-Corey said, saying the airline has had some make “adjustments” for some dishes. There’s also the matter of the type of fish Alaska serves. Because the airline is so tied to the Alaska fishing economy, it can’t just buy any fish. “There have been some situations where maybe we wanted to choose ... a certain product from a specific place, and we had to pivot because it was just the right thing to do for the communities that we serve and the people in the fishing industry," Traynor-Corey said.

• Another vexing product is avocado. Traynor-Corey said he tries to lean in to West Coast trends, so the airline created an avocado toast that it expected would be very popular. It was tasty, he said. But it was also brown, and so it never made it onboard. "If you've ever had to open an avocado and then have left it in your fridge, or had guacamole that you opened up and then want to eat it, you notice the oxidation that occurs, yeah, which is completely safe," he said. Perhaps someday, he said, the team can try again.

• At Air Canada, Nasr said pre-order is a game-changer because his team gets real data. I think we all know there's a fog-of-war element when flight attendants sell onboard food — some goes missing, and some is miscategorized when sold.

  "We're actually able to A-B test the order that the entrees appear and the descriptions, and other elements," Nasr said. "With that, we can optimize the menu design as well as the loading parameters, the operations of the catering service itself."

• I love to give Air Canada’s team shit about “the omelette,” which for years was complemented by an odd cottage cheese concoction. The joke was that no one could change anything about the omelette while Ben Smith worked there because he believed customers valued consistency. But recently, Air Canada overhauled everything but the eggs. "Customers loved the egg," Nasr said. "The challenge was around the omelette. Without going into too much detail, we removed the warm cottage cheese. We upgraded the sausage to a chicken parmesan sausage that we pan-fried, and we changed the potatoes as well."

• I like Nasr for many reasons, but one is that he doesn't think like an airline executive because he graduated from Cornell School of Hotel Administration, where professors teach hospitality to students headed to careers at hotels or restaurants. In those industries, executives often sample their competitors' offerings and steal from them. Nasr told me that a hotel general manager might pop over to a competitor's property while on vacation and ask for a room tour, going so far as to evaluate how clean its bathroom is, "because that will tell you a lot about how the hotel is run." I have noticed that airline executives rarely fly the competition, unless another airline has a more convenient flight. But Nasr is an outlier — he said he flies about 300,000 miles per year, about half on competitors or partners, in all classes of service. "I find that having those experiences firsthand helps me relate to what my team is telling me, and even more importantly, it allows me to talk to crews of other airlines and get their take on the industry and their own company, and actually probably learn even more than from seeing the seat, or the service, or the lounge," he said.

That’s all for today. I’ll be back soon with some thoughts on Delta’s first quarter earnings.

1. American is spending a fortune on new business class suites for long-haul and premium domestic transcontinental routes. That’s all great. Clearly, it wants you to see it as a premium airline. But American still doesn’t sell real food in economy class on flights shorter than 1,300 miles. That decision probably saves American money and makes logistics easier. But is it good for the brand?

2. I should note that Nasr often chides me for my obsession about food. He’s a good source, and he’s always willing to answer my questions about it. But he wants you to know that he only spends about 5 percent of his time on food.

3. Traynor-Corey said there’s only one real rule. He is not allowed to significantly alter the airline’s fruit and cheese plate, which at some point morphed from typical food-for-sale into a core part of the airline’s brand. People (including me) are obsessed with this thing.

4. How much more? It’s something I asked both Nasr and Traynor-Corey, and neither could give me a figure. I am sure they have some idea. But Traynor-Corey said industry spending on food and beverage is a bit of a black box. “That data is very hard to figure out because of the way that it's reported,” Traynor-Corey said. “I know food costs very well, and I can tell you that we are probably investing more than our competitors across the domestic industry.”

5. Can I pick on American again? It serves white-labeled pretzels. It looks cheap, no?

6. Traynor-Corey, whom I found refreshingly honest, admitted that the dish isn't fully authentically spicy, because this is still an airline and it can't have its passengers sweating in the cabin. "I would say that that dish probably started a lot more spicy and we toned it down to be more acceptable," he said.