POWER 50: IN FRIENDLY CLIMATE, IT'S TIME TO SOAR: AIRLINES: FARE-ORIENTED ADS WORK, BUT UNITED TACKLES DIFFICULT ISSUES

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As the economy flies high, so does branding in the airline industry.

The No. 1 advertiser in the category, Southwest Airlines, built its fortunes on short-hop, no-frills service and cheap fares-all supported strongly by local, fare-oriented advertising. Starting in 1996-as its route system began to reach national scope-advertising began to change. Southwest broke its first major branded campaign from GSD&M, Austin, Texas themed "Symbol of Freedom."

TENSION CREATED

Dave Ridley, the carrier's 44-year-old VP-marketing and sales, says image touting won't take a back seat to fare ads, but will create "a healthy tension" between filling seats immediately (via fare ads) and building loyalty in the long-term through branding.

"We never spend as much on branding as we'd like because our product is extremely perishable," he says, noting branding is a luxury of the relatively good economic times.

The time seems ripe for airline campaigns. Delta Air Lines just launched an estimated $40 million "On top of the world" campaign from its new agency, Saatchi & Saatchi Advertising, New York. America West Airlines plans a $25 million branding campaign once it has selected a new agency after shelving Team One Advertising, El Segunda, Calif. United Airlines has turned out a brash branding campaign called "Rising."

Under the stewardship of Senior VP-Marketing David Coltman, "Rising" has caught the industry's attention by admitting to the unenjoyable aspects of flying, such as late planes and bad food.

NEW DIRECTION

United gives such soul-searching a good face: "Compared to the rest of the industry, United is heading in a different direction," says print ads, running in general and business publications as well as gay media.

Mr. Coltman says the airline was striving to imbue its brand with an image that was honest, unlike some past industry efforts resembling "puffs of smoke Air advance

and heavenly experiences."

"If you talk to [our agency] Fallon McElligott," he says, "They've never met such a savvy, well-informed group of consumers" as United's focus groups. "They [the flying public] won't be fooled."

FINDING ROAD WARRIORS

The unique approach followed a comprehensive study of "road warriors" that Mr. Coltman ordered up after the airline surprised the industry by ditching its agency of 31 years, Leo Burnett Co., Chicago, in summer 1996.

The decision for an agency review came about "when we put the new team together after the employee buyout [of the airline]," says Mr. Coltman, 55. "We thought we were changing course and wanted to make sure our agency was going in the same direction."

With United's new campaign, its worldwide ad budget swelled from $100 million to $120 million, though that increase is mostly international. Y&R Advertising, New York, got the international side of the business.

Yet, Mr. Coltman said, such increases are an exception in the industry, which saw ad spending increase 11% overall in 1996 by major carriers but actual outlays are short of what they were several years ago.

"I don't think you'll see huge increases," Mr. Coltman says. "There are so many other ways of communicating to passengers, such as websites."

SOUTHWEST MOVE

Southwest is one of few carriers to substantially increased its media budget, up 21.3% in 1996 to $90.7 million. Mr. Ridley says the ad increase is merely a reflection of the airline's success.

"We're the only airline that's been growing at the rate of 15% [in revenue] a year,"

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