The airlines have discovered a nifty way to really get the attention of consumers and competitors. Just yesterday, Spirit Airlines announced service from Los Angeles International (LAX) to Las Vegas McCarron (LAS) with introductory one-way fares of just $1.00 per seat, plus applicable taxes. While this bargain fare is heavily restricted to travel on certain days and flights, it is creating quite a buzz.
Spirit Airlines is one of few airlines that focus on leisure travel. By this, I mean they fly to very leisure oriented destinations such as Fort Lauderdale, Orlando, and Atlantic City. They have also been part of the pioneering group of airlines that started charging for everything from pillows to advance seating assignments. So why has Spirit Airlines not already targeted LAX to Vegas? So many competitors – both low cost and legacy carriers – already serve the market. They needed a bold way to introduce their brand and get attention in order to make the five daily flights a success.
The industry impact has been interesting. Some airlines like jetBlue and Allegiant Air did engage in a “fare war” while much larger Delta Air Lines and United Airlines did not. My guess is that much of the passenger traffic on Delta and United is connecting through LAX and therefore they feel the discounted fares would not help to gain market share.
While the $1.00 fare seems ridiculous, it is a proven sales tactic that generates traffic to Spirit’s website, talk in the industry, and gets the seats filled.
Yesterday a press release was issued about how Delta Air Lines has entered an agreement with AEG to become the official airline of the STAPLES Center in Los Angeles, official airline of the L.A. Kings, official partner of The GRAMMY Museum at L.A. Live, and will have rights to marketing in the L.A. Live complex. Whew! That is quite a mouthful of information for a one press release! What I find most interesting, though, is the impact of branding a brand like Delta Air Lines and STAPLES.
In the travel industry, perhaps it began with airlines promoting brand name coffee served on their flights? I’m not sure. But soon after we saw cruise ships starting to feature popular branded F&B outlets onboard like Johnny Rockets and Starbucks. Starwood Hotels has even created brands inside brands (see “Aloft – a vision of W Hotels”). I suppose that part of keeping brands fresh involves mixing other brands in to the advantage of both. Certainly but not limited to the travel industry, products need to be kept fresh and exposed to find and maintain relationships with new consumers.
Take this hypothetical example: John Doe just moved to Los Angeles from Atlanta to begin his career as a professor. In his new position he will travel to Asia often for research. He is an avid hockey fan and one evening goes to an L.A. Kings game to see his new home team play. At the STAPLES Center he notices Delta’s presence. In fact, he notices Delta’s presence all over Los Angeles and how they just began service to Tokyo’s convenient Haneda airport…. Back to the Kings game: Just after the 1st period, his assistant calls to report his laptop crashed. He glances up for a split second, and responds “Go to Staples and get a new one”.
The synergy of branding a brand or having multiple brands working side-by-side is – if nothing else – great exposure!