USAIR'S MARKETING CHALLENGES

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USAir is struggling with a public relations nightmare-and a daunting, longer-haul marketing challenge.

In the aftermath of the Pittsburgh area crash of Flight 427, which killed 132 people and was the airline's fifth crash in five years, USAir enters this massive marketing effort low on financial resources.

USAir already wants to elimi-nate $1 billion in costs annually by 1997. Even so, it expects a loss this year of more than $350 million.

USAir's temporarily canceled advertising from Earle Palmer Brown, Bethesda, Md., will resume Sept. 26 at the earliest, said a company spokeswoman.

Meanwhile, what can the nation's sixth-largest airline do from a marketing standpoint?

Advertising Age asked its daily fax readers that question last week, inspiring a wide range of suggestions from 40 people. More than anything, USAir must openly address safety issues in upcoming ads, preferably featuring a top company executive delivering the message, respondents said.

The more safety-specific these ads are, the better, readers noted. They said future ads should zero in on pilot training and maintenance procedures.

One suggested USAir organize an industrywide campaign focused on what is being done to reduce the probability of airline crashes, possibly by establishing perfect flying goals and programs.

Other ideas from readers, half of whom said they would fly USAir in the future:

Show statistically that flying is still the safest form of travel.

Lay low on advertising and focus on public relations.

Establish new discount programs to target business flyers.

Offer vouchers to skeptical customers.

For now, the airline is concentrating on handling the needs of the victims' families with assistance from in-house staff.

Marketing consultants contacted by Ad Age gave USAir high marks for quickly providing information to the public, as did Ad Age readers. In the fax poll, nine people said they thought USAir had handled the crisis "very well," 22 said "acceptably" and seven said "poorly."

But experts criticized USAir's intention of "exploring the possibility" of buying the crash site to set up "a permanent memorial to the passengers and crew members of the flight."

"I think acquiring the site of the crash is a bad idea," said crisis public relations specialist Robert Dilenschneider, chairman of the Dilenschneider Group, New York. "I'm just stunned by that; it's very different from something like the Vietnam War Memorial in Washington or the Tomb of the Unknown Soldier."

He also questioned the condolence ad USAir ran last week in the Pittsburgh Post-Gazette and

Besides restoring confidence in travelers, USAir must dramatically cut costs, largely through labor concessions, because its costs of 11.46 cents per available seat mile are the highest in the industry.

Further, marketing partner British Airways has suspended additional investment until USAir lowers its cost structure.

Despite extensive media coverage, USAir experienced "no appreciable change in bookings," maintained the spokeswoman.

Usually airlines rebound several weeks after a crash with hardly any long-term repercussions. But USAir's crash record worries marketing consultants.

"One of the most devastating things about this is the concept of the fifth crash in five years-it's memorable, unfortunately," said Jack Trout, president, Trout & Reis, Greenwich, Conn. "You talk about a negative slogan-it's a real danger."

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