What can new start-up airlines learn from the experiences of Roots Air?

The story of Roots Air began early in 2000, with a cryptic voicemail message from Ted Shetzen, the man behind Roots Air, to Leo Desrochers, the chief operating officer of Skyservice Airlines Inc., a Toronto-based charter carrier that mostly ferried travellers south in the winter. Mr Desrochers’s acquaintance with Mr Shetzen went way back, to the days when both worked at Air Canada. Shetzen’s message was brief and to the point, saying only, ‘It’s time.’
From those two words emerged a plan to steal away a small portion of Air Canada’s most profitable customers – business flyers – by enticing them with celebrity pitchmen and promises of great food, plush lounges, and excellent service, all at lower prices. A main attraction of the new venture was its branding agreement with Roots, the clothing empire founded by Michael Budman and Don Green.
Roots invested $5 million for the right to put its name on the carrier and design the uniforms, lounges, and other promotional items. Trading on the trendy image of the apparel retailer, the timing of the new airline seemed encouraging. The merger of Air Canada and Canadian Airlines was not going well, and there was reason to believe there were a lot of disgruntled travellers looking for an alternative.
A key element of the Roots Air strategy was to use brand-new A320 and A330 aircraft but exploit Skyservice’s existing infrastructure to operate at low cost. ‘We basically saw an opportunity to carve a place out for ourselves in the business market, not with high expectations of market share, not competing with Air Canada everywhere, but enough to allow us an adequate return on capital,’ recalled Desrochers.
Roots had two service tiers: gold and silver. Gold included luxury items such as leather-covered seats, whereas silver service was tailored for the more pricesensitive business traveller. In March 2001, a Roots silver-class fare was about $800 one way from Vancouver to Toronto. Air Canada’s fare was almost $2,000 for the same journey.