MARKETING SUPERSTARS;LINEAS AEREAS PRIVADAS;ARGENTINAS (LAPA) GUSTAVO DEUTSCH

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BUENOS AIRES-In a country where state-friendly giants have few rivals and price competition is nascent, Gustavo Andres Deutsch, president of Lineas Aereas Privadas Argentinas, is a maverick.

Even more so considering the avid flier of 30 years came upon the airline when he received it and a ranch in rural Argentina in 1984, in exchange for a small plane he was trying to unload.

From those curious beginnings, LAPA has grown to a nine-plane fleet with expected sales this year of $60 million, up from $32 million in 1994.

Its policy of unrestricted bargain fares, as much as 20% lower than those of its competitors Aerolineas Argentinas and Austral, has helped it garner a 20% market share and put the two airlines on the defensive, each just recently discovering fare flexibility.

LAPA's growth has not gone unnoticed outside Argentina. In August it became a partner in United Airlines' Mileage Plus frequent-flier program.

Though a pioneer in introducing bargain airfares, Mr. Deutsch, 60, admits he hit upon the strategy in an unscientific manner. "I decided one morning, `Let's see what happens if we lower the fares by half,' " he said. "All of a sudden the airplanes were full."

In early 1994, when the Argentine government granted LAPA four routes, the airline began to make a name for itself. Now LAPA has 27 routes and expects to fly 700,000 passengers this year, up from 400,000 last year.

"They gave us a hand and we took the whole arm," he quipped.

Before then, LAPA was forced to operate as what Mr. Deutsch called a regularly scheduled charter airline. Regulation also prohibited it from advertising.

Revenge has proved sweet. Aerolineas Argentinas last year lost $293.2 million, while LAPA made a modest $1.5 million profit.

Now free to advertise, LAPA spends $3 million annually, mostly on print and radio ads by Eje Publicidad that concentrate on the low fares. Mr. Deutsch said, "We say, `This is our price.'*"

Southwest Airlines, the U.S. low-fare trailblazer, is a role model for him.

Before 1997, Mr. Deutsch expects to boost sales to $100 million and market share to more than 30%.

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