And Chief Revenue Officer Woody Harford
With a new name, CitationAir (from CitationShares), a broader product offering, coordinated sales efforts with majority owner Cessna and a focus on being a “solutions-based” provider, Chief Executive Officer Steve O’Neill and Chief Revenue Officer Woody Harford met with Elite Traveler President and Editor-in-Chief Douglas Gollan at their headquarters in Greenwich, CT., ahead of today’s announcement, to explain what all the changes will mean and to provide an update on what they are seeing in the private aviation market.
ET: What is the history of CitationAir?
Steve O’Neill: I started Wayfarer Starshares on December 31, 1998 with four of my good friends, who are good customers to this day. At that time we flew King Airs in the northeast only, had six employees and operated out of White Plains airport. We had no idea what it would turn into. On July 11, 2000 we sold the company to Cessna and traded in our King Airs for Citations. Being short on time, and some would argue creativity, we rushed to name the company CitationShares; after all we sold fractional shares in Citations. A lot has changed since then. Our workforce is comprised of hundreds of dedicated employees and our product line has expanded to include jet cards, whole aircraft management services and corporate solutions. While our operation has undergone dramatic growth and changes, our entrepreneurial spirit and commitment to our customers has not. The good news is, with growth and change comes opportunity—the opportunity to leverage our strengths to help us grow, the opportunity to challenge the largest players in the private jet market and the opportunity to re-launch ourselves so that we clearly articulate what we offer and how we’re different.
ET: Why the name change?
Steve O’Neill: Rebranding our company will help us re-establish our position in the marketplace, make it more clear who we are and what we offer, allow us to become more marketable to new prospects, and instill confidence in our customers and stakeholders. The name CitationShares stemmed from the origins of the company, when we only sold fractional shares in our Citation aircraft. By changing our name to CitationAir, we will remove the product offering limitations our old name suggests, while keeping the equity in the Citation portion of our name that has been built up throughout the years.
ET: What will the customer see?
Steve O’Neill: Cessna is in three business lines: they make airplanes, they sell parts and service airplanes, and they operate airplanes. CitationAir is the operating side. We are essentially creating one-stop shopping. Consumers now get a customized solution. Here you can buy whatever you need. We sell services, and Cessna sells the hardware. If there is one thought we’d like people to walk away with is we are not interested in selling them what we want to sell them, we want to sell them what they need, so we’re going to ask them what they need and create a solution specifically for them. We have customers who have gone from jet cards to whole aircraft, and customers who own whole aircraft and buy more jet shares and jet cards. We craft solutions based on their individual needs. We believe customers are going to be encouraged by the strength and stability of our combined efforts.
ET: Will there be a greater emphasis on corporate flight departments?
Woody Harford: Being part of Cessna, our objective is to help Cessna sell more aircraft. We want flight departments to exist and thrive. Our goal is to help flight departments become more efficient and survive during difficult times so when times get better Cessna can sell them more whole aircraft. Our CitationAir Corporate Solutions product is designed to make their departments more flexible and efficient.
ET: Why the changes now and how will it work?
Steve O’Neill: In addition to a weak economy, the private jet market has come under enormous pressure. In order to stay successful, we must ensure our sales and marketing efforts leverage all of our assets and points of difference. Our customers and product offerings have evolved, and so must we. Cessna is perhaps the most iconic brand in the private jet business and will greatly enhance the perception of CitationAir’s strength, stability and expertise. By adding Cessna’s name to our logo and other marketing channels, we are publicly aligning ourselves with the Cessna brand. The new product names support the overall CitationAir brand and better describe what the products actually are. By doing this we will reduce confusion and simplify our product offering to new customers. We have transitioned our fractional product name to CitationAir Jet Shares, our Vector Card has become CitationAir Jet Cards, our JetForth product will now we called CitationAir Jet Management and our Corporate Solutions product name has remained the same.
ET: In the launch video, you speak about Yellow Tie service?
Woody Harford: Yellow tie service was an outgrowth of what customers were telling us they love about CitationAir service. When they see the pilots with their yellow tie in the FBO they feel secure that they are in great hands. Being able to use the description customers have for our service as a branding element was a really unique opportunity we couldn’t pass up. We’ve woven yellow through a number of elements of our communications and service delivery but it’s just an accent, not overwhelming.
ET: Any plans for yellow planes?
Steve O’Neill: No yellow planes.
ET: Will this change the service footprint for fractional and jet card owners?
Steve O’Neill: Our jet management business is essentially worldwide, but the footprint of the fractional and jet card business is not changing.
ET: How is your business mix changing?
Steve O’Neill: Some customers have moved away from jet shares to jet cards, yet whole aircraft sales with management contracts are growing dramatically year over year. Five years ago 100 percent of our sales came from fractional. Today it’s 58 percent from fractional yet our total sales are up. Currently 26 percent of our active fleet is managed aircraft.
ET: It also sounds like you are increasing your emphasis on your relationship with Cessna?
Steve O’Neill: Absolutely. Cessna brings the strength and stability of a company that’s been around 85 years and is an iconic brand in business aviation. Cessna’s not going anywhere. They make more business jets than anyone in aviation, and they take care of our maintenance needs. They provide us with parts, financing. It is a totally integrated offer.
ET: Are there going to be any changes to the service customers see on the planes?
Steve O’Neill: Over the years service has been a strength, and we will continue with that. This rebranding only re-energizes our pilots’ commitment to delivering outstanding service.
ET: With the economy continuing to be challenging, how are customers using private aviation?
Steve O’Neill: In the fourth quarter of ‘08 and first quarter of ‘09 those [customers] that needed to get out, got out. Those that stayed in really haven’t changed their patterns very much. In August and September activity was back above expectations and growing. We are starting to see a bounce back in business flying as customers pursue business opportunities.
Woody Harford: Jet cards continue to see stronger sales, but we’re going to be coming out with some fairly aggressive offers for fractional shares in the fourth quarter. A lot of people are concluding that aircraft values have bottomed so there is more interest in jet shares and jet management.
ET: Are there any particular things these days that make the phones ring?
Steve O’Neill: First of all our sales force is busy these days, and that wasn’t necessarily the case six or eight months ago. There is a reasonable correlation to the stock market but it is more long term than day to day.
Woody Harford: Customers are responding to offers that have a combination of great value and importantly, flexibility.
ET: However, private flying has been getting a bad rap for a while?
Steve O’Neill: Apparently today somebody asked the White House spokesperson about how the President can justify flying all the way to Copenhagen for a one hour business meeting [to pitch Chicago for the 2016 Olympics], and his answer was Air Force One is a fully equipped office and he will be working. I think that says it pretty well.
ET: So your new tag line is “Where you belong.”
Woody Harford: Our new tagline, “Where You Belong,” was born out of the approach our customer service and flight department personnel have always taken, where we strive to make every customer feel as if our company really is somewhere they belong. It is emotional and involving, almost inviting customers to join a place where they feel like a member.
ET: Are you planning to expand the partnerships CitationAir offers?
Woody Harford: It’s our intention to go out and find best-in-class partners with the right quality and right long-term relationships. So, yes you will see some interesting partnerships, just nothing more to announce right now.
ET: There are a growing number of commercial airlines that are offering private jet service solutions—Korean Air, Delta Airlines, Lufthansa, Qatar Airways, Saudia, Swiss. Is CitationAir looking at any partnerships with commercial airlines?
Woody Harford: Yes, we are always looking for new ways to grow the business. We have an outstanding product that aligns very well with the most sophisticated international carriers so you can expect to see us pursue these types of agreements.