Is Virgin America Ready to be Relevant?

In our most recent Readers' Choice Awards, I couldn't help but notice an interesting trend: Virgin America didn't really register, failing to place in the top three in any category, even those where Virgin should be competetive. Best Economy Class Cabin? Five percent of the vote. Best Onboard Entertainment? Just 7.1 percent of the vote. Favorite Domestic Airline? Only 3.6 percent. And this from an airline that has won numerous critics awards, including Most Eco-Friendly in our Editors' Choice Awards, as well as multiple Best Domestic Airline awards from the likes of Conde Nast, Travel & Leisure, and Zagat.

So what gives?

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The answer is simple: Take a look at Virgin's route map. Based in San Francisco, the airline, until recently, only served a handful of destinations, including Boston, New York, Washington, D.C., Seattle, San Diego, Los Angeles, and Las Vegas. Nothing in the middle of the country—no Minneapolis, St. Louis, or Houston—and very little in the South, meaning many people haven't had the opportunity to fly Virgin. So, as it turns out, SmarterTravel readers weren't necessarily saying they dislike Virgin America, just that they didn't know it very well.

That, however, could change soon. Virgin America has begun a major expansion in the past 12 months. Virgin has launched or announced new routes to Ft. Lauderdale, Orlando, Toronto, Dallas-Ft. Worth, Cancun, and Los Cabos, and the general consensus is that there's far more to come. The airline has made no secret of its desire to be in Chicago, and its recent order of up to 60 new planes suggests continued rapid growth in the future.

But with growth comes risk. Brett Snyder, who has covered Virgin America extensively both for CrankyFlier (his own blog) and for BNET, penned an article this past March titled "Is Virgin America Flying Without a Map?" The title more or less speaks for itself, but in the article, Snyder calls into question the wisdom of Virgin's focus on leisure destinations, notably Orlando and Cancun, instead of business destinations like Philadelphia or even Atlanta. Leisure destinations are a bit more prone to seasonality fluctuations, not to mention economic influences, thought the latter is true for business routes as well. A Virgin spokesperson told me the airline has been adding leisure destinations with an eye toward balancing seasonality, particularly in the winter.

The downside to competing on business routes, however, is that it usually requires going head-to-head with a larger, firmly entrenched legacy carrier. Such is the case in Dallas, where Virgin will be competing with American. When Virgin announced its Dallas route, Snyder said the only downside to the move is that Dallas happens to be American's home base, and American isn't afraid to use "scorched earth" tactics to defend its home turf. "Remember when Vanguard came to [Dallas]?" Snyder wrote. "No, neither does anyone else, because American destroyed it mercilessly. How about the Legend debacle at Love Field? Legend flew airplanes in executive configurations, and American got nervous. It actually refitted a fleet of airplanes just to go to Love Field and kill Legend. Once that was done, the airplanes were reconfigured and sent back into the main fleet."

Then again, it should be obvious to Virgin execs that they can't overtake American. But Virgin can offer an alternative, aiming instead to pick off customers from the margins, people who aren't heavily invested in American's much-larger frequent flyer program, or who are simply looking for a cure for the big-carrier blues. This is true of other large business markets as well, such as Philadelphia and Chicago. Well, in theory at least.

But if Virgin America's future is linked to any one carrier, it is likely JetBlue. The two airlines offer startingly similar features, from seatback TVs to comfy leather seats, and where one has an advantage (Wi-Fi on Virgin versus none on JetBlue, for example) the other counters with an advantage of its own (free first bag on JetBlue versus $25 for the first bag on Virgin). Still, Virgin's star seems to be rising as JetBlue's is beginning to level off, if not fall a bit. Virgin is a fresher, hipper take on the JetBlue approach, with fun, gimmicky embellishments like mood lighting, and more useful, tech-friendly features like the aforementioned Wi-Fi. JetBlue spent a decade establishing itself as the standard for top-notch value, and still offers much that other carriers don't, but it's easier to sprint to the head of the pack than it is to stay there. If JetBlue can't stay ahead of the curve—and its dreadful excuse for in-flight wireless certainly doesn't inspire hope—the window is open for Virgin to surge ahead.

Whatever the future holds, one thing is certain: Virgin America is making its move. And while posting predictions is usually a fool's errand, I think it's safe to say the next eight to 12 months will see a whole host of new destinations popping up on Virgin's route network. Adding Chicago or Philly shouldn't surprise anyone, nor should more destinations in Florida or even the Caribbean, given the airline's track record.

Whether any of it works, and turns Virgin into a truly national carrier, is a whole other story.

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