Nico Bezuidenhout in the captain’s chair

here was a time in South African aviation history when air travel was akin to a stay at an international five-star hotel or a luxury cruise. Even if a stay at Raffles Hotel in Singapore or a trip on the Queen Elizabeth II was beyond you, a person of reasonable means could afford – even if only rarely – to fly to Johannesburg, Cape Town or Durban for special occasions.

There was a mystique; a feeling of adventure... and South Africans played their role to the full.

If you were flying, you dressed up for the occasion. Even dropping off or fetching someone at the airport required attire more fitting than shorts and sandals.

These days, as in so many other aspects of life, we have caught up with much of the rest of the world. Air travel’s future is in the mass market, in being a commodity and an experience not much different to catching a bus (perhaps worse – no one asks you to take your belt and shoes off when you board a bus).

Nico Bezuidenhout, the surprisingly youthful chief executive officer of low-cost airline Mango, is under no illusions about the kind of service he provides. “Short-haul air travel is a commodity like milk and bread,” he says of the no-fuss, no-frills deal that he and other like-minded airlines – Kulula and 1Time – offer South African travellers.

And, like milk and bread, his aim is to make flights easy to book and within the budget of as many South Africans as possible. Bezuidenhout calls it the “unflown market” – those who previously never imagined they would be able to travel long distance by anything other than taxi, train or long-haul bus.

It is a strategy that seems to be working, and he talks enthusiastically about the number of Mango passengers he has seen taking photos on board. “That’s a first-time flyer, no doubt,” he points out.

Bezuidenhout, who grew up on the East Rand within earshot of the constant air traffic at what is now OR Tambo International Airport, believes strongly that the future of local passenger aviation is tied to the industry’s ability to unlock the potential of the emerging market.

To back his argument, he points to research carried out prior to Mango’s launch in late 2006, which showed that only a small percentage of South Africans had ever flown, partly because they viewed it as elitist. Even a relatively under-developed country such as Thailand has a greater market penetration when it comes to air travel.

If more passengers can be encouraged to fly, it means lower airfares which, in turn, attract still more first-time flyers. These then become regular flyers – and the cycle repeats itself.

The beginning

The airline with the fruity name and distinctive orange livery first took to the skies in November 2006, the product of a decision by South African Airways (SAA) management to enter the budget sector of the market with its own offering, in order to compete with the growing popularity of the private low-cost carriers.

Bezuidenhout, then aged only 30, was tasked with making it a reality. He had been at SAA for the previous five years, lured there from a career in e-commerce with tour promoter Big Concerts (where he was tour finance and merchandising commercial manager), and online ticket broker Ticketweb (where he was chief operating officer).

His initial role at the national carrier, as head of direct sales channels, had been to establish electronic ways of selling tickets to customers.

But later he had become involved in a special research team, whose task was to study the international low-cost aviation sector and assist the board in determining whether SAA should launch its own subsidiary.

The assignment took Bezuidenhout to international low-cost carriers such as Nok Air in Thailand, Ryanair in Europe and Jetstar in Australia, among others.

After a year of research, the airline’s board gave the go-ahead and Mango was born amid much fanfare – and not a little outrage from its low-cost competitors.

The source of the disquiet was that Mango, as an SAA subsidiary, had been founded on the back of a R100-million loan of taxpayers’ money. This, the complainants said, was being used to compete unfairly with private businesses.

Subsequently, Mango has repaid the loan and has been profitable for several years.

Whatever the merits, the public took an instant liking to the low fares and there was enormous initial interest, with up to 10 000 website impressions a minute being registered as consumers scrambled for tickets.

Within 14 months, Mango had carried its millionth passenger, and today that number exceeds four million. The airline has since claimed that its introduction grew the size of the local aviation market by 10%.

Skills from outside

At first glance, Bezuidenhout seems an unlikely choice for CEO of an airline. His background in the industry is relatively limited and he admitted at the time of his appointment that he was not an aviation enthusiast – something that is slowly changing. What he is, though, is a pragmatist and an efficiency devotee who is excited by the challenge of the low-cost carrier business model.

His background in e-commerce as a means of selling tickets to consumers stands him in good stead. “I’ve always had a passion for distribution channels. Low-cost airlines rely fundamentally on distribution channels,” he told an interviewer at the time of launch.

Bezuidenhout readily admits there are large gaps in his industry knowledge, but points out that he has hired the skills required – from SAA and other carriers – hopefully to make Mango work efficiently. Over time, he has learnt to delegate and not to second-guess the decisions of his managers with specific expertise.

“My role is to make sure the appropriate resources are in place and that they are co-ordinated and prioritised to serve the best interests of the business,” he says. “One of my biggest learnings was to let go a little – the challenge is to ensure you have people you can totally trust.”

Bezuidenhout concedes that running an entire airline – albeit a small one, with only four aircraft and a relatively small staff complement – has been a big learning curve. But his background in industries other than aviation has been an advantage, and he is comfortable with looking for solutions and staff from outside the industry.

“Sometimes you have to go outside the norm.

“When you consider, say, airport passenger facilitation, it is maybe not the best thing to look at how other airlines process queues quickly. “Sometimes it makes sense to look at supermarkets – they process many more people than airlines could ever do,” he explains.

“It is about challenging the status quo and bringing in change management of resources – making sure your staff understand that you can do things in better and more efficient ways. In some cases, that means you have to inject resources from outside the aviation industry, just so you can get a mix.

“That is something Mango consciously did: we looked for a balance between aviation skills and skills from elsewhere,” adds Bezuidenhout.

Doing it differently

Seeking non-traditional solutions has been key to Bezuidenhout’s quest to maximise efficiencies and keep fares as low as possible. An example is aircraft turnaround time. He says that four years ago, the norm was 45 minutes. At launch, Mango consistently achieved between 25 and 35 minutes.

The airline’s on-time record is reported to be the best in the industry.

Staff are multi-skilled. Paper flows are eliminated wherever possible, in favour of electronic formats. One centralised operations room uses technology to control all movements nationally.

The business class lounge service is outsourced. Mango does not have a call centre; instead, it ‘rents’ seats as and when required from a service provider. Much of the marketing function is outsourced, so too is public relations.

But does this not make for a ‘cost is king’ philosophy, where the passenger is an unwanted distraction in the daily quest for operating efficiency? Bezuidenhout says no.

“I try to get the idea of ‘warm efficiency’ – if there is such a thing – across to our staff. I give the hypothetical example of the tannie (granny) who is on her way to the checkout counter and the flight is closing in one minute. I tell them I want the big, strapping lad behind the counter to pick her up and carry her through to the gate.

“If they get there and the flight is closed, it is closed – we will not inconvenience 185 other guests [Mango-speak for ‘passengers’] for the sake of one. But at least, if the tannie is still stuck there, I want her to come away with the knowledge that we tried everything. That passion and commitment is what I hope to come across,” he adds.

The airline has tried to think outside the box when it comes to being accessible to consumers, particularly the ‘unflown’ segment. While tickets are available via the traditional channels – travel agents, call centre and the Internet – Bezuidenhout says Mango pioneered the idea of selling tickets at Shoprite Checkers stores and allowing customers to buy on credit, using store cards issued by the Edcon Group, which includes Edgars and Jet stores.

“Usually, an airline would sell its cheapest tickets on its own website,” he explains. “But, by default, people who want the cheapest tickets typically have the least disposable income, do not have a credit card, and only limited (if any) access to the Internet. So how does this person ever purchase his/her ticket?

“That is when we took the view we should sell them tickets where they buy their bread and milk.

“Of course, these customers often do not have immediate access to cash, either. So we opened up a payment mechanism that allowed them an alternative form of credit – in this case, the option to buy their ticket at Shoprite Checkers and pay for it on their Edcon account,”
adds Bezuidenhout.

According to him, other carriers have since followed this example.

The future

Bezuidenhout’s next step is to add more aircraft to the fleet, probably additional Boeing 737-800 aircraft, which have served Mango well so far.

Additional domestic routes are on the cards, followed later by regional destinations within the African continent.

He declines to give a specific time frame or to confirm the routes. “For us, the key is that there is potential. The route does not have to justify it right now, but you have to look at whether the stimulation effect of low prices will increase the size of the market and therefore make it viable.”

Regarding the aviation industry in general, Bezuidenhout says he would like to see the low-cost airline business model flourish on the African continent.

“A healthy aviation sector is necessary in order to encourage wealth generation and increased quality of life. Low-cost airlines can help drive that.” ▲

Mike Simpson