We have just received word that Hawaiian Airlines will launch non-stop service between Honolulu’s International Airport and New York’s JFK Airport next June. While there is current non-stop service from Newark Liberty to Honolulu on United-Continental Holdings, this new service is a vote of confidence in the travel industry’s growth particularly to such a heavily tourism dependent state.
This is not just another airline starting a new route – here’s where the impact begins: The battered tourism industry in Hawaii will be receiving over 100,000 new seats annually. This translates into millions of dollars in tax revenue for Hawaii, and over $156 million in additional consumer spending (these figures courtesy of Mike McCartney, Hawaii Tourism Authority). And yes, New York will obviously gain from the new connection in terms of visitor spending, taxes, etc.
Now onto the best part – the brand! Hawaiian Airlines is in the midst of an aggressive fleet renewal which includes brand new wide-body Airbus A330 equipment (which will be featured on flights to/from JFK), new seating designed to increase legroom throughout, extensive on-demand seatback entertainment in all classes of service, and free hot meals for all passengers on these long-haul flights.
Both consumers and travel industry insiders have seen all sorts of advertising methods evolve. While social media outlets like Facebook, Twitter, and Foursquare are in the midst of becoming traditional, still newer forms keep evolving especially in the guerilla marketing segment of advertising. Enter a recent trend: Flash Mobs! I just watched a YouTube video (watch below) of American Airlines using a flash mob to create buzz about adding 10 new destinations from Los Angeles.
Yes, I think it is a cleaver way to generate brand buzz, especially if the flash mob performs in multiple locations of high traffic in a particular city or region. Not only are people talking to others about witnessing the experience, but they are recording and posting videos of it onto social media. The actual exposure is not just the 30 people who witnessed it live but potentially thousands more.
The cost of hiring a few actors for a day –or longer– is much more cost effective than buying air time on major TV networks. And since these highly organized flash mobs come and go so fast in public places, there is a quick impact on the public. Expect to see more creative flash mobs popping-up around you in the near future at rail stations, public parks, and malls.
The first airport lounge opened in 1939 at New York’s LaGuardia Airport with American Airlines “Admirals Club Lounge”. Since that time, many large airlines have opened lounges at focus or hub airports to cater to their own premium passengers and allow them a place to relax away from crowded gates. Access to these lounges typically requires a paid membership with passenger ticketing in business or first class cabins. Now a new brand of lounges is ready to hit the US with future expansion plans.
AirSpace Lounge, a start-up in the airport facilities industry, is getting ready to open their first lounge at Baltimore’s BWI Airport. Their concept involves creating lounges that are open to anyone who wishes to pay the entrance fee. With passes starting at just $17.50 per visit, AirSpace intends to use yield-based pricing to make the venture a success. As the lounges fill up to capacity, the pass pricing continues to rise. Lounges are slated to have power outlets at each seat, wifi, complimentary meals, and alcoholic beverages available for sale.
I am confident this new brand will certainly make an impact on the marketplace, especially where some of the largest airlines — like JetBlue and Southwest Airlines — do not offer airport lounges. Also, over the last 10 years airlines have downsized or closed lounges making space easily available for AirSpace Lounge to lease. Targeting all passengers regardless of ticketed cabin further increases exposure and allows AirSpace to create a loyal following.
How will the airlines react? Space at each individual airport will dictate who can expand and how much. If AirSpace Lounge is a wild success, I predict airlines will either try to match the inclusivity and pricing concepts or buy interest in the venture.
Look for the first AirSpace Lounge to debut at Baltimore BWI this May! If you have a long layover or arrive at the airport early, consider this option for comfort, relaxation, and connectivity!
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.
During the previous decade, the travel industry entered a period of Darwinism. Survival of the fittest became the reoccurring theme and that resulted in a number of large mergers. Acquisitions were not frequent due to frozen capital markets in the Great Recession and fear over where the global economy was headed. As the travel industry contracted and new brands emerged where the did the previous ones go? And what exactly happens to brand recognition during the merger?
Airline mergers are a great example because of their size and impact on the whole travel industry. Remember America West? They became part of US Airways. How about Northwest Airlines? They are now part of Delta Air Lines. Continental has recently begun is rolling itself into United Airlines.
While the airlines try to limit confusion during the conversion process, brand managers know that featuring the best of each individual brand often works best. For example, Delta took what they felt were the best parts of both Delta SkyMiles and Northwest’s WorldPerks and developed one that both client bases would enjoy. The new United is adopting Continental’s most recent livery while keeping the name “United” on their jets.
I think brands take their place in history and never really evaporate. Use the link below to see the Delta Air Lines family tree and the parts of it’s sum:
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!
While the weather causes chaos across much of the United States, many of us folks in New England are starting to become submissive to the nasty winter weather. We have started thinking that snow is part of our weekly routine and an unfortunate expectation. And as we are required to travel for work, school, and basic needs, we often look for guidance in what was traditional media (as I define television, newspaper, and radio outlets). Huddled away from what seems to be thousands of inches of snow, my thoughts now turn to social media, smart phones/devices, and how organizations in the travel industry are harnessing the power of these communication methods.
Social media like Facebook and Twitter are by no means “new”. Neither are copious choices of iPhone or Android applications. What is interesting, however, is the sheer number of people that because of these outlets are informed simultaneously of an event or decision. One great local example is Boston’s Logan International Airport on Facebook. They update the status on traffic accidents getting to or from the airport, weather conditions with estimated flight delays, and changes in aircraft boarding gates due to construction. People are then able to adjust travel plans and arrive or depart the airport based current information. Bravo also goes to the airlines that also use social media to broadcast travel waivers and allow customers to be proactive in changing flights before the weather arrives.
The positive impact social media is making on travel industry operations helps to ease tension for consumers and employees alike. No one wants to miss their Caribbean cruise due to a snowstorm, but sitting in an airport for hours hoping to fly just makes the travel process more difficult. A simple text message notifying of a cancelled flight and then another of automatic rebooking makes all the difference to everyone concerned.
A sincere “thank you” to those in the travel industry that take the time to Tweet and update their status so we can be much more informed and prepared!