Mary, Mary quite contrary how does your monopoly grow, it doesn't
The above quote is the strap line from a Ryanair marketing campaign directed at the then Irish Transport Minister Mary O'Rourke who had just rejected a proposal from Ryanair to build a second terminal at Dublin Airport.
Siobhan Creation's book starts with Tony Ryan and the creation of Guiness Peat Aviation (GPA), which specialised in aircraft leasing. The book highlights the successful building of the business and the subsequent collapse that centred around a failed flotation of the business on 18th June, 1992. The dramatic failure of the float saw Tony Ryan's personal wealth go from $300m to debts of $37m in a few hours.
The growth of GPA had allowed Tony Ryan to set up his own airline to exploit the potential on the Dublin–London route. The first Ryanair flight left Dublin on 23rd May, 1986 heading for Luton. Ryanair set a fare of £99, which was less than half the price of British Airways and Air Lingus.
Michael O'Leary was a teenage friend of Ryan's sons who went on to study business at Dublin's Trinity College. His view was that '...business students just wanted to go out and "rape the world" and that his time at Trinity was four years of meeting girls and drinking alcohol'.
After his studies O'Leary embarked on a job with KPMG, helping wealthy clients with their tax affairs. He decided he was not cut out to be an accountant and went on to purchase Newsagents and build a property portfolio. Tony Ryan had employed KPMG years earlier to audit his farm. In 1988, he stopped by Newsagents and asked O'Leary to become his personal assistant.
By 1988 Ryanair was losing money and had lost £7m in two years, at this point Ryan put O'Leary into the airline as his financial watchdog. This was followed by the inevitable move into the Chief Executive's chair.
O'Leary is still in the same chair. On 5th November, 2007 he delivered a record half year after tax profits of 
408m, up 24 per cent on the same period last year, where traffic grew by 20 per cent to 26.6m passengers in the six months to 30 September but yields fell by 1 per cent as revenues rose by 24 per cent to 1,554m.
Siobhan Creation's book moves into the O'Leary era with speed, capturing the political, financial and operational challenges that Ryanair has been through under his leadership. What it gives you is a picture that O'Leary is in complete control of the business. He has adopted best practice from American low-cost carriers such as South West Airlines while enhancing the business model to be one of 'no frills'.
From a revenue management and pricing perspective, the spectacular success of Ryanair in our area is built on a business model that is so robust that when Boeing stress tested it in 1998 as part of the due diligence process for the sale of 25 new planes they could not find any three-month period where Ryanair would not be profitable. The stress test included demand drops, fuel price increases and exchange rate volatility.
With the operational and cost base of the business robust, Ryanair have been able to engage in pure price competition throughout Europe, which has seen other low-cost carriers fall by the wayside.
The strategy of the fare gets you on board and nothing else. The 25-min turnaround of aircraft and the low cost base of using airports that meet Ryanair's demanding terms and conditions have also fuelled the growth of this remarkable business.
There is a lesson in this book (which is more of a story) to all of us who wish to be able to practise revenue management as the theories dictate. The more fat that is in the cost base and the operational functionality of the business, the less effective any revenue management programme will be on bottom line profits.
As we all know, Ryanair have the ability to shock, disappoint, irritate and stir with the best of them, but at the end of the day the business booms and through Siobhan Creation's book it is easy to see why.
So, 'Michael, Michael, quite contrary how does your monopoly grow?' With a steely application of best business practice that supports a price lead volume strategy where demand is matched to supply at a price that the business is willing to offer rather than a price the customer is willing to bear.
