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Just wanted to address one thing I keep reading everywhere from airline management to people on this board, that people will always go where they get the lowest fare. That is COMPLETE bunk! If that were true we'd all be driving Kia's, Yugo's, Chevettes, and Escorts!
The only time people shop solely based on price is when they consider a product homogeneous, like milk. I battle this everyday in the insurance business. Many people view insurance as a product that is the same with every company, price being the only difference, BAH! There are huge differences between contracts that can mean thousands of dollars difference at claim time, even on personal lines policies. The problem is people don't realize the difference. Once you show them what's different about a policy, they're willing to pay more if they consider the difference worth the extra cost.
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I think you are making the case against your argument. Between carriers most people do consider the product homogeneous. There is not nearly the difference between airlines as there is between insurance policies. And that determination is made by people who fly and know the products, not by what they see on TV.
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THAT, my friend, is where you are wrong. While you obviously know a ton about aviation management (I suspect some college course work in the subject?), you don't have a good understanding for marketing/advertising and branding. Absolutely the current perception is, even among people who know better here, that a plane ticket is a plane ticket is a plane ticket. BUT, that perception is DEFINITELY up for change with slick advertising that sticks. THIS is where many ad agencies and every airline ad I've ever seen absolutely misses the boat. They advertise what THEY think differentiates them, instead of what would influence the PUBLIC into thinking they're different. To Mr. Joe Customer off the street, he couldn't give a flip that DAL has routes from BNA to Timbuktu. All he, or anyone, cares about for routes is the specific route they're planning at the time!
What you have to do is get in the customer's head and ask, "What would make this person pick my airline first as long as we fly their intended route?" I say DAL's biggest strength is SAFETY. And there are millions, MILLIONS I say, customers that put that as a HUGE concern when flying. The problem is that you've never seen an ad that plays on this and nails down the fact that all these regionals and LCC's are flying you around using 20-something pilots with less time on the earth than DAL's pilots have in a cockpit! Same for their maintenance crews. With the proper ad campaign showing stereo-typic young pilots and incompetent crews and then contrasting to show a stately DAL pilot and a spotless maintenance facility, it wouldn't take long to set a branding of DAL as THE airline to fly.
You're always gonna have you're price buyers who pay low no matter what. But there's also a significant share of the market that isn't constrained totally by price that will pay extra to fly with one carrier if they have a reason, as the miles programs prove. You've just got to give them a reason. Branding with experienced pilots and mechanics is really an ace in the hole that DAL has never tried. I personally think it would work wonders for them.
I mean you guys say it all the time. I've read it here numerous times, "they say pilots are overpaid until that overpaid pilot saves their butt." Well, use that and promote it in advertising, "Yeah we cost more, but who do you want flying YOUR airplane? Fly with BEST, DAL."
I'm telling you, it would work. Might not be the cure to all their financial woes, but would definitely increase their market share with the scores of consumers who don't always view price as the most important factor. There are millions of products out there that prove Americans will pay for what they percieve as better quality. The critical word there is perceive.
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The airlines have spent millions, if not billions, in marketing trying to differentiate themselves based on service. I would say it is the primary focus of most marketing.
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Not at all true. They just have lovey dovey pictures with smiling ticket agents and F/A's. That doesn't make me feel safer on a particular carrier's planes. They've got to nail home the point that they have best pay because they have the best pilots and to fly any other airline is to have less than the safest pilot in your cockpit. Hence, you pay more to fly DAL. You get what you pay for.
For too long the airlines have been sheep in a "group-think" box following one another over the cliff fighting over prices while none of them have made any headway in branding differentiation. And the ones that stand the easiest job of doing this? The Legacy carriers. They have fantastic name recognition already. All they have to do is attach a premium worth paying for to that name and they'll get a significant piece of the non-low-cost flyer's business.
Heath
