May 2004
Chuck Greenwood's FBO is profitable and growing, and he'll share the secret
of his success with any other FBO.
"This program is so simple that anyone could do it," he said. "AII
it takes is a partnership with a supportive, market-savvy fuel supplier, a
focus on margin rather than fuel-flow volume, and an absolute commitment to
the customer," Greenwood said.
Greenwood Aviation, at the Ponca City Regional Airport (KPNC) has a close
partnership with ConocoPhillips, which provides Phillips 66 Aviation brand
jet fuel and 100LL avgas to the FBO. Owner Greenwood was anxious to try an
innovative pricing structure plus other marketing tools to try to grow the
business.
"Our pricing tactics were straightforward but untested," Greenwood
said. "Our fuel supplier understood immediately which helped make the
whole thing work."
UNUSUAL PRICING PROGRAM
Under the new marketing program, Greenwood increased fuel sales in 2003 by more than 100 percent over the same period in 2002. Much of that increase came in sales to pilots who had planned to fuel at nearby "big-name" FBOs but were told by other pilots to fuel in Ponca City instead. Some transient operators have even bought fuel cheaper at Ponca City than at their own FBO base.
Transient fuel customers pay Greenwood's cost for fuel, plus a $100 pumping fee for the first 1,000 gallons.
For uplifts over 1,000 gallons, the pumpage fee is 10 cents a gallon. "When a marketing program starts to fly on word-of-mouth, you know you have a winner," Greenwood said.
CITY/LOCAL BUSINESS SUPPORT
"If I can increase sales every year using this pricing program, I can show the local government how important this FBO is, and they'll continue funding airport improvements.
"Anything we can do together to improve this facility and make it more
attractive to local business will help me," he said.
"My goal is to make the transient fuel-stop business cover all overhead
costs, so that all other business income is total profit, and that means my
profitability is driven by local business growth."
Greenwood has gained local economic development support to remodel the FBO.
He accomplished this by convincing city officials what he had learned as a
pilot and former corporate jet manager - that the airport is "the best
possible front door for a community.
"Some cities' economic development programs spend $300,000 to attract
businesses that spend only 10 minutes of their time listening to a pitch,"
he said.
"But an FBO has a minimum of 15 minutes of captive time on the ramp every
time a business executive lands, and that is how we sold the city on the importance
of this airport as a marketing tool, rather than as an expense."
Greenwood invested part of the money to make the FBO's bathrooms memorable.
He installed brand-new, touchless fixtures and he keeps fresh-cut flowers
in each bathroom.
"In talking with more than 400 pilots over two years, we identified the
number-one image-maker of FBOs," Greenwood said. "It's the rest
rooms. Customers can overlook some other inconveniences but, they want clean
rest rooms."
As an added touch, Greenwood posted the original government flying regulations
in the restrooms.
"Did you know it's illegal to fly with spurs on?," he said.
THE FACILITY AND UPGRADE PLANS
The FBO has about six acres of ramp and access area next to a 7,000-ft. runway, plus self-service fueling facilities. There are 14 employees, including seven line employees and one Aircraft Maintenance Inspector. It has a 15,000-square-foot hangar and three other corporate hangars of 7,000 to 10,000 square feet for base tenants.
Greenwood will add 7,000 square feet of office space to the FBO, and recreate a high-school gymnasium look in the main hangar.
Greenwood will turn his primary ramp, closest to the building's front door, into a "drive-through" facility of some 200 feet long by about 75 feet wide.
That work will be completed by the end of 2004.
"That will be our quick-turn facility and will let us get plane wingtips
within about 20 feet of the front door," Greenwood said.
TOTAL MARKETING PROGRAM
Pricing is only part of the total marketing program that Greenwood developed after surveying more than 400 corporate and private jet pilots about what they want from an FBO.
"When you walk into my lobby, the sodas, cookies, popcorn and candy are
all free for pilots and their passengers.
"It's all part of the Ponca City package, like an all-inclusive vacation.
We don't nickel-and-dime our customers and, if they need to stock their airplane
for a long flight, we won't charge for it." Greenwood keeps a vending
machine in his FBO, but only to set a perceived value on the things he gives
away.
DETAILS PLEASE PILOTS
Customer-pleasing small touches are everywhere. Greenwood even spent $600 extra for a special ice-making machine to produce small-chip drive-in style ice instead of large cubes.
"Everybody says they love the old drive-in small ice chips," he said. "Large ice cubes don't work well in small sized aircraft equipment or Thermos bottles, so we spent the extra money to get ice that fits.
"It sounds like such a small thing, but it's the little stuff we do that makes the pilot's job easier and makes him look better to his aircraft owners and passengers. That's why pilots come back and tell others to come. They are becoming our best marketing tool."
MARKETING FOR BIG WHEELS
The Ponca City FBO has been in business since 1982. In the past two years, Greenwood has set out to make it a great transient fuel stop. Since he aimed only to cover his costs and have fun, he focused at first on weekly aircraft movements and celebrity visits.
"I wanted to pull a few airplanes a week out of the sky that had no intention
of stopping here before we contacted them," he said.
"Also, because of my passion for sports, I went after people that I wanted
to meet.
"If I could show that Ponca City was good enough for recognized sports
figures, then I could convince lots of pilots that it would be good enough
for them, too," he said.
He started with golfers. His first, direct-mail campaign, inviting pilots
flying from California to the Masters' Tournament to refuel in Ponca City,
pulled in eight new customers.
Based on that success, Greenwood then contacted NASCAR executives and drivers
who have multi-airplane fleets and travel coast-to-coast several times a year.
"When people like Ricky Rudd and Bill Elliott stopped here and told their
friends about us, I got more excited about the business and that lead to even
more success," Greenwood said.
MARGINAL INCOME FOCUS
Greenwood came to realize that usual business practices don't really work at an FBO. Even so-called fixed costs -- such as personnel, rent and insurance -- can increase month after month.
Rather than calculate a break-even figure by the number of gallons of fuel pumped, Greenwood focused on marginal income.
"Too many FBOs think they need to pump 100 gallons more each day, but I wanted to make $100 more each day. Growth isn't about gallons, it's about margin per plane."
Rather than focusing on large single sales, Greenwood instead built a program to service more airplanes at smaller individual profit margins. Not only would that protect his business, it would make it grow faster as more customers
spread the word.
LEARNING FROM FAILURE
Greenwood also is a big fan of making mistakes. "I've learned something from every marketing failure that I've had," he said. His first marketing program attempt offered to beat any fuel price nationwide by charging a penny-a-gallon less than any fuel receipt printed in the last 20 days. He dropped the program, however, when fraudulent receipts began to surface.
"I backed my fuel supplier into a corner on that program, and Phillips 66 Aviation came through like a champ, but I didn't want to be a receipt cop."
TRANSPARENT AND STERLING
Greenwood also discovered from that program he couldn't build a lasting business on low prices alone.
"You could give away the fuel, but if the facilities and service are bad, they won't land for free fuel a second time."
That's when he developed the marketing program that has been bringing pilots back time after time -- what he calls "transparent pricing combined with sterling service.
"AII we need to do is make a small margin per plane to cover our costs and stay in business. My customers get the best Phillips 66 Aviation fuel at the best prices in the country -- and we just add the country's best service."
E-MAIL ~TING
Greenwood's data-driven e-mail marketing program can target specific end-users with different messages.
Called "Just the Facts," the program shows flight routes to or from a target-market area.
The software then shows that Ponca City is possibly 50 miles closer and no more than 25 miles further than a selected well-known fuel spot for that route
and explains how Greenwood Aviation's fuel fee structure can save the customer
money.
"Many pilots haven't heard of us before, so we have to show them why they should stop here," Greenwood said.
BUILDING CUSTOMERS ONE AT A TIME
Since Ponca City isn't a noise-sensitive airport, Greenwood Aviation can go after the aircraft that other places don't want, such as the G-2s and G-3s that haven't been hushed, and Lear 25 or Falcon series freighters piloted at night by "those forgotten soldiers building up time by flying freight.
"Whatever else we do, I make sure we have food for freighter pilots, free of charge," Greenwood said.
"These guys are out there all night and deserve first-class treatment. We give them our own 'Freight Dog' shirts which has turned out to be great advertising."
Greenwood designs the Freight Dog shirts himself which feature "a series of cartoons that keep these guys coming back for more."
Greenwood also "rents" DVD players and movies for free if they are
returned on the flight back. Those that aren't returned within a week are
billed to the pilot.
Another benefit of landing at Ponca City is reserved for those with pets.
Greenwood credits his 13-year-old son with the idea of welcoming pets as well
as their owners. Greenwood built the Pet Port "for the most precious
fur you have in your airplane" which includes a dog run, a fire hydrant
and has free "doggy goody bags."
INVESTING
Greenwood spends about $30,000 every year on marketing, excluding advertising.
Part of this cost is the salary of a marketing specialist who writes e-mail
marketing, and does follow-up sales and survey calls two weeks after a pilot's
first visit. The remaining dollars are used for trinkets, e-mail and updating
marketing software programs.
"The key to marketing success, regardless of FBO size, isn't only 'putting
the customer first' but putting all the value back into the customer relationship,"
Greenwood said.
