Special Guests: Jeff Hayzlett - Marketing Expert

LIZ MACDONALD, HOST: Well, what goes up did come down. A slew of major airlines rolling back air fares. Delta the latest to hike prices by 10 bucks round-trip, only to ditch the idea days later. Marketing guru Jeff Hayzlett says higher prices for a low level of service ain't going to fly.

Can you say Netflix? So you think this is going to catch on?

JEF HAYZLETT, MARKETING EXPERT: No, never does. Last year -- in this last year, they have had 16 attempts to the raise prices of fares.

MACDONALD: The airlines have.

HAYZLETT: The airlines have. Only half of those have stuck. People are just tired of it. It used to be an airliner. Now they're really just nothing but airbuses. It is a bus mentality.

MACDONALD: So what was the most annoying fee hike?

HAYZLETT: The highest one that you can get charged is on American Airlines, 450 dollars for an overweight bag internationally. I think I will just get in the bag and fly myself. It's a lot easier.

MACDONALD: If you're going on your honeymoon, just put your spouse in the bag.

HAYZLETT: Hey, that is not a bad idea, depending on how well they did in the wedding.

MACDONALD: Do you think the airlines are getting a clue -- and other companies? You mentioned Bank of America and the banks rolling back debit card fee hikes. Is this the way companies are saying --

HAYZLETT: You can't do it.

MACDONALD: You can't do it. Right?

HAYZLETT: You can't keep giving bad service. These guys have gone from the full buffet now to basically a low airline mentality. If you're Southwest or one of those where you're coming up from that, it's a little bit easier to do.

But if you're one of the big guys and then really trying to now nickel and dime, 1.5 billion dollars last quarter alone they made in these extra services and fees. It is just ridiculous.

MACDONALD: You know what? How can they --, you know, six billion dollars for a very beleaguered, you know, industry that has been getting a lot of turbulence. A lot of spilling red ink. They can't let go of that six billion annually.

HAYZLETT: Without question. The thing is to really go back to giving service. If price is your only differentiation, you have lost before you began. What these guys have to do is get back to giving good service. Give good service; people are going to pay for it.

MACDONALD: Jeff, who is the worst at hitting flyers with fees?

HAYZLETT: It depends. You asked people different things, different things. If you're a frequent flyer on one airline, you are going to love them. If you're not on the other ones -- it depends on who you are standing in front of at the time. That is who is going to be the worst at it at the time.

MACDONALD: So it's fly the not so friendly airlines when it comes to fees. Their stocks have not been -- for -- the airline stocks have not been in the upright position lately, right?

HAYZLETT: They haven't. They have a lot of things working against them. They have the economy working against them. So people don't want to fly as much. You got gasoline prices, fuel prices that are up.

You have increased airport fees, because the airports themselves and governments are looking for more money to bring in. They have a lot of things working against them.

They really have to just get back to be great at good service and get back to taking care of the key customers.

MACDONALD: Who else is rolling back fees?

HAYZLETT: They all did. They all did. Everybody went from four to 10 dollars, and tried to do it. Now they're all doing it. It's like a white buffalo in the herd. It's like you stand out.

The first one that jumps in, then all the wolves dive in on him and try to separate them out from the rest of the herd. And then everybody gives up after that.

MACDONALD: Separate subject, do you think the Jetblue, you know, stranded on the Tarmac thing hurts Jetblue?

HAYZLETT: It always hurts Jetblue to have that kind of activity. It hurts everybody. But it happens to everybody. That's what has come about as part of this, you know, deregulation of the industry. That is what has come about from this whole shift --.

MACDONALD: Is it deregulation or is it an airport problem? The airports are not taking care of it?

HAYZLETT: In that case, it was a little bit more of an airport problem and everything else, trying to get the tarmacs open and everything else. Overall, it is about not having enough people working at the counters, not having enough people working at baggage claim, not having enough maintenance people, everything.

MACDONALD: Jeff Hayzlett, marketing guru, so good to be with you tonight, sir. Thank you for your time.

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