5 Ways Marketing Can Save the US Airline Industry

There are few other industries that have suffered as much across the board as airlines in America.  From bankruptcy to solvency to operational issues – flying domestically in the US is not what it used to be.  There are news stories about 30 million bags being lost, service deteriorating, employees protesting, and airlines folding.  Yesterday’s USA Today carried a story titled "Service" in the skies (the choice of quotes telling the story).  Is it all because of soaring fuel costs and shrinking margins?  Crushing financial pressure from supporting too many employee pensions or new security costs?  Not entirely.  The problems I see are partially due to operational problems, but marketing is fundamental – and most airlines are still stuck in the old school.  Here are a few ways that I think changing the marketing approach could ultimately save the US Airline industry:

  1. Stop Costly Television Advertising.  Not to blame the plight of the industry on United, but they came out of bankrupcy and decide to spend dollars on TV spots showing cartoon characters about the brand?  No special offer, no promise to consumers, no compelling reason to fly United.  This is bad for the industry because it means the boards of all United’s competitors are now pressuring other marketing teams to advertise on TV as well.  There are thousands of things US airlines need to spend money on.  TV spots isn’t one of them.  Smart airline marketing teams should change the focus to word of mouth marketing instead of old school advertising – and fire any agency that tells them otherwise.
  2. Improve the Airport Experience. Let’s face it, the experience of travelling domestically stinks.  From long security lines, to rude personnel – people don’t like travelling by air anymore.  But the majority of the experience is in the airport, not on the plane.  Imagine if airlines got together and funded things like big screen movie theaters in airports?  Or kiosks where you can see HD-quality documentaries about the places you are going to go.  Airlines may not have typically worked together, but this is an area that pooling resources could help all involved (John Infanger has a good article about the impact of common use facilities). If travellers get on the plane happy – who cares about the quality of the pretzels?
  3. Focus on Current Travellers. Marketing in the airline industry is consistently focused on the people who might travel.  The problem is, this results in lots of wastage.  There is a huge untapped market of current travellers who are already travelling.  They are sitting on the plane right now, and the only marketing they see is the useless Duty Free magazine.  This is a missed opportunity.  What about giving every passenger on a flight a $20 off code for their next flight?  Or doing random upgrades so anyone has the chance for an upgrade rather than just the "elite" customers. Or giving away 5000 frequent flier miles to the passenger who has the best random act of kindness on the flight, like helping someone with a bag or saying something nice to someone else.  Market to the customers you have, rather than the ones you might convert through price breaks.   
  4. Build Trust by Adding Common Sense. Everyone knows they could have paid 3 times the price of the person sitting next to them.  Beyond this, there are many rules on airlines that don’t make sense.  You can’t carry nail clippers on board, but you can listen to live air traffic control on your headset.  Your seat back has to be up for takeoff and landing, or else what?  You can use a mobile phone when you land, but better leave that ipod and laptop off – what’s the difference?  The airline industry is full of contradictions and a lack of common sense.  In the end, this all adds to a lack of customer trust.  Make your policies real, and you can build that trust back.  Add more transparency in pricing, and customers will reward an airline brand with greater trust.
  5. Make Marketing Bigger, not Micro.  Marketing promotions today commonly focus on soporific announcements about 2 inches of extra leg room or 500 (yawn) frequent flier miles if you check in online.  The problem is, the micro is easy to duplicate – and consumers don’t really care.  Everyone else can do it, so no one owns it.  Be bold, launch an initiative like wireless internet access on all flights.  This can’t really be that expensive – and lots of consumers would go to an airline that guaranteed this.  If all your innovations are micro, you need bigger marketing ideas.

International Note: I focus on the US airline industry in this post because International airlines have a very different model.  A significant number are government funded in part or whole, and most do not suffer from the crushing amount of domestic competition that US based airlines must contend with – thus the "price war" dynamic prevalent in the US is less common abroad.

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