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Why Don’t the Airlines Get the Same Kind of Loyalty as Coke or Pepsi?

March 30, 2009 | Posted in: Airline News,Ask Rick,Pricing Activity

If you saw my recent post on the possibility of Delta dropping Coke for Pepsi, then you probably noticed that it got a lot of comments.

People, it seems, are pretty darn passionate about their soda pop!

And you have to wonder – why? I know I’ll sound like a heretic here, but face it: Coke and Pepsi look the same, they cost the same and some folks think they taste the same (or pretty close). So what’s the difference? Plenty, say many of you.

Okay, now let’s look at the airlines: these days, there are fewer and fewer differences. For one thing, even the legacy carriers are firing out sales as well as matching the airfares of the low cost discounters. And service isn’t so different, either: most have gone the “bag-fee” route.

The head of US Airways might as well have been speaking for all airlines when he told SmarterTravel that there’s been “very little consumer pushback” to the fees (even though comments on the blog would suggest otherwise), and that includes the beverage fee US Airways introduced – and dropped – because nobody else matched it (and because it was turning the airline into a joke).

It can’t be mere marketing or branding – both Coke and Pepsi have had award winning ad campaigns over the years – but so have the airlines (think of all those gorgeous United ads).

So – what’s left in terms of airline loyalty? Keep reading…

Maybe the CEO of Spirit Airlines was correct. Nearly two years ago, in a rather embarrassing episode, one of his internal emails was made public, in which he slammed a man who dared to complain about the airline and was not going to fly with them again. According to the emailing CEO, that man would return to the airline “when we save him a penny.”

Was he right? Is the rock-bottom-line all that matters?

Well – that is the question. I think it does to an extent and here’s why. Coke and Pepsi have separate and sometimes frenzied followers – because the two products, though similar, are both always consistent – and always perceived as “good” products.

And the airlines, though similar, are not consistent (with some exceptions) and are generally perceived as “mediocre” products. So marketing and branding can’t do much beyond the proverbial lipstick on a pig.

Case in point: Slate highlights a new Comcast ad that’s really something – really hypnotic. One woman said she stops in her tracks the moment it comes on, but added – “I still hate Comcast.”

So the airlines, the “product” – must improve. I know, it’s not all your fault – we have an aviation industry that needs fixing – and I’m talking about everything from air traffic control and ancient tarmac to oil prices that zoom to crazy prices at times. But there are no stimulus packages for the airlines, so – what can be done?

Well, as painful as it might seem, it is really about getting back to the basics (the ones my father taught me as a young boy) including excellent customer experience and service — day in and day out. When fit hits the shan, step up and address it head on – and mean it.

Maybe it’s time for all the airlines to figure out what are the things they get right – and concentrate on delivering that special something in a consistent manner. And build ad campaigns and merchandize products that customers can believe in.

Yes, the bottom line will always be important – maybe most important – but with imagination and focus, meaningful and valuable differences can emerge. And maybe the airlines will find their customers singing about (and purchasing tickets for) “the real thing”.

7 Responses to “Why Don’t the Airlines Get the Same Kind of Loyalty as Coke or Pepsi?”

  1. Steve Filson says:

    Well, good theory and wouldn’t we love it to be true so we could once again fly in relative comfort and good treatment. But since de-regulation in 1978, survey after survey shows that the price of a ticket is the single, only factor in deciding which airline a consumer chooses for a trip. The only factor. That is why Southwest has captured the market. It’s branding is the lowest priced product even though they often are not. Their branding has been brilliant.
    Further down on the preference list in these surveys, and there have been scores of them over the last thirty years, is destination, schedule, reliability(includes safety and on-time performance), and down around 6th or 7th is service.
    If you want the airlines to compete on service, you’ll have to make pricing the same at every airline as it was duriing regulation. It was then airlines had the finincial stability to just compete on service. For policy it’s up to us but we have to make a choice. We can’t have both low prices and good service in the airline industry. Thirty years and certainly today’s fee enriched product has certainly proved that.

  2. Rick Seaney says:

    Steve I would disagree on pricing, be tied to service, Southwest would be a classic counter example

  3. Ken says:

    Southwest is the perfect example – but not because of its pricing. It has been consistent – just like Coke or Pepsi. Their branding is not really as the lowest-priced product, but rather as a customer-friendly business (which includes an element of pricing in it). If a so-called brand changes every 20 minutes (as with the rest of the industry), it isn’t a brand. Likewise with changes in pricing schemes, changing the rules on frequent-flyer programs, etc. Personally, I want a different experience than what Southwest offers, but their customer loyalty is amazing – all because they’ve created and stuck with their product, and executed it extremely well. That is what a quality and long-lived brand is all about.

  4. Steve Filson says:

    Well, perhaps but remember, the Southwest brand message is “….your free to move about the country”. That is a low price message not a service message. And in the planning room of Southwest they will tell you that their only quest is to be THE low priced airline and nothing else. It’s the reason they still avoid offering meals because it doesn’t pass that test of keeping costs at rock bottom. Because they treat their people very well, their in-flight staff are usually in a good mood and that translates out to friendly attitudes but their “service” is very stripped down and many business travelers avoid Southwest. Yes, a loyalty among the backpack crowd (good folks mind you) but not among the mainstream airline system.

  5. Rick Seaney says:

    Your point is well taken, I just was at an airline marketing conference and airline marketeers say they are tired of the product (air travel) is a commodity (price) mantra and are going to merchandise and brand around prices (ala carte and branded airfare families) to distinguish themselves from each other and “show their particular value”. I agree they have their work cut out for them as they continue to act like Ryanair on fees — we will soon see packages of airfares and fees so be prepared

  6. Ken says:

    Rick, Very interesting speculation. Could you elaborate? I don’t see how they can create (and sell) different “packages” of fares and fees, and if they do how it will differentiate them from the competition. Are you saying the package will be selecting from a much more transparent Chinese Menu of fees? Or that they will sell “air to Chicago with free checked baggage” as a distinct sales item? Aren’t consumers confused enough already regarding fares, services offered (for free or fee), etc.? Nonetheless, in my simple marketing-guy mind that isn’t branding. Branding is about the big picture — what a business wants people to perceive as their image. I think you’re saying that the airlines still don’t understand branding, but will just be selling product without a message behind it.

  7. Rick Seaney says:

    Airlines are following Air Canada and Qantas models of “fare families” check out those sites to see where we are heading.

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