Airlines: Air leaders struggle for a way back

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Even before the Sept. 11 terrorist assaults, airlines were battling a dismal travel environment. Doleful economic conditions already had caused a precipitous volume drop when the terrorist attacks turned the situation into a fiscal catastrophe. The high-profile November crash of American Airlines Flight 587 in Belle Harbor, New York, further spooked jittery consumers. That accident also marked the second time in two months that airlines pulled their advertising in response to a disaster.

By the end of 2001, revenue of almost all carriers was in a free fall, with the industry posting full-year losses of more than $6 billion. In the fourth quarter alone, major carriers combined lost $3 billion. Ad spending reflected the financial woes. Continental Airlines was the lone large airline to increase its media budget.

Deciding when to return to the airwaves and what messages to present was a weighty issue faced by the industry. Southwest Airlines was the first to come back to TV-eight days after the terrorist attacks. Southwest ran toned down ads that omitted its "Symbol of Freedom" logo. "The country itself was defending freedom, which had taken on a much larger aura," says Southwest Senior VP-Marketing Joyce Rogge.

emotional ads

American Airlines and United Airlines, whose planes were used in the attacks, entered a self-imposed TV blackout for more than a month. Both companies returned with emotional campaigns. Continental Airlines put out several specific ads acknowledging the attacks, but stayed true to its "Work hard. Fly right" branding.

While 2002 has seen a greater recovery in business fliers compared with leisure travelers, the industry continues to focus its advertising on the former, more lucrative, segment, despite the fact Corporate America is scaling back company travel policies, directing staff to the coach section, and even canceling meetings in favor of teleconferences.

When targeting the secondary leisure market, United and US Airways are trumping fare sales, with the latter also geographically broadening its ad play. "We want to tell consumers to lock in now, fares are low," says Stephen Usery, US Airways VP-marketing and revenue management.

A Southwest promotion offered one free ticket with a discounted ticket. Southwest is among the short-distance providers that also contend with cheaper and perceived safer options of travel. It views its alternative as the car; shuttle providers, Delta and US Airways, compete against trains. "It's not just my shuttle vs. your shuttle, but my plane vs. your train," says an industry executive.

In the Northeast, Delta and US Airways have gone head to head with Amtrak's high-speed Acela Express train line: US Airways print ads read, "Time flies, it doesn't wait for a train." Delta ads proclaim: "Planes are faster than trains."

technology reduces hassles

In the wake of longer security lines and increased delays, airlines are tapping into technology to improve airport flow. They're also playing up equipment advances in their marketing. United is installing easy-to-use, self-service check-in units and has enacted a flight update system that pages, calls or e-mails customers to give them schedule information. Southwest rolls out this month its first-ever automated boarding pass system.

Delta offers virtual check-in and flight information for Palm Pilots. Delta's goal now is to make flying "a more people-friendly experience" and says: "We understand what is upsetting you, and we're trying to solve that,"says a Delta spokesperson.

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