It's been a stellar year for WestJet. On Valentine's Day, its year-end results showed just how stellar. The Calgary-based airline reported record full-year net income results of $114.7 million (an almost 378% increase from 2005). Leading the way is Sean Durfy, the company's president since September (Clive Beddoe stepped down but remains as CEO and chairman). Durfy, 40, has worked in everything from advertising to energy, but feels at home in the often difficult airline industry. He recently sat down with contributor Michelle Magnan to discuss his new role and WestJet's future.
So far, have you had any surprises in the new job?
It's a very high-profile position. I think I was a little naive as to how high profile this really is in terms of public visibility and being in a leadership position with an airline. The airline industry is larger than life, and the characters in it are larger than life. It gets a lot of coverage and a lot of press.
Speaking of which, WestJet was recently in the news for becoming Wal-Mart's preferred airline for business travel. How important is the business traveller to WestJet?
Less than two years ago, we had 18% of the business market in Canada. Today we have about 28%. Why is the business traveller important to us? The business traveller travels between four and six times a year. The leisure traveller travels less than two times a year. The business traveller books closer in the booking curve, so they actually pay more. We like those guys. We love the leisure folks. I mean we built our business on them. But we also like the business people.
Where do you want to expand your business-traveller markets in the U.S.?
I can see a time when Houston looks good or Dallas looks good, or New York, San Jose, San Francisco, San Diego. The issue with the business market is if you're going from Calgary to Toronto, 50% of that route is sold in Calgary and 50% is sold in Toronto. If you're going from Calgary to Phoenix, 90% is sold in Calgary and 10% is sold in Phoenix.
That works really well in the sun destinations in the wintertime, but if you're going to build a business market, you need point-of-sale in the U.S. You need 25% of all your sales coming out of [there]. Today, our U.S. point-of-sale might be 7% to 10%.
How do you build on that?
The quickest way is through electronic travel agents like Travelocity and Expedia. I could go to L.A. and spend my entire marketing budget and not make a dent because I don't have the frequency, the presence or any of that stuff. I need to find different ways of doing it, and the best way is probably through the electronic travel agent.
Clive seems to be slowly handing you the reins. What do you think will happen in the next couple of years?
I think this is what it is. It's a transition. Clive is still involved from a mentoring and monitoring position. We decided on this awhile back. You'll probably see the continuation of that transition over the next year.
Will he leave at the end of it?
I think Clive will probably always be chairman of this company. I hope he always will be. But he's delegated most of his day-to-day responsibilities to me and the executive team.
How do you differ in your approaches?
We're very complementary. Clive is more entrepreneurial. I've been a professional leader and manager for my career, so it's a bit different there. He'd say I'm more process-driven. That's a good mix when you get a larger company, because you never want to lose your entrepreneurial spirit and drive. At the same time, man, you've got to put good processes in place so they're repeatable and people understand them as you get bigger, or you get yourself in trouble.
What's your vision for the company?
By 2016, we want to be one of the five most profitable airlines in the world, [and] the preferred choice for folks to fly with and for people to work for. It's a pretty lofty goal, but we think that our model is very sustainable, and our culture is sustainable, too. People always say, “You're going to lose your culture.” Well, we now have 6,000 people all over North America, and it's as strong as it's ever been.