The Marketing Guy

Rooting for Good Marketing Since 2009

Archive for Airline Marketing

Successful Marketing in the Niche

Much like casino craps players always placing a chip on the “Don’t Come” line when the entire table is hoping for anyhing BUT a 7, or the stock trader with “calls” and “puts” that fine profit in the margins and variances of daily stock movement, it’s important in marketing to know how to find seams and gaps in competitive product offerings.  It can be profitable and innovative.  The latest example of this I’m witnessing is in the airline industry here in Seattle, where the longest serving foreign-based carrier to Seattle, SAS, is ending its service after 42 years of flying between the northwest and Scandinavia.  There are lots of reasons for this cut, the economy mostly, but also competition.  Just a few years ago there were but a few direct flights from Seattle to Europe, giving both SAS and British Airways a new monopoly on these routes.

But as other airlines and destinations came forth, like Air France to Paris, Lufthansa to Paris, and even Northwest flying to Amsterdam, the competition heated up and SAS, given their own precarious financial position, was not able to make the route profitable, and as such, will end it this summer.  Now you’d probably think that with all these entrenched competitors–the big three airlines of Europe, throw in Northwest (now part of Delta, the largest airline in the world), that there would no more room for any new entries.

iceland1And of course we’d be wrong.  Enter small, Scandinavian Icelandair, which last week announced weekly service from Seattle to Keflavik, Iceland.  They’ll serve the route with smaller, more fuel efficient 757 aircraft; their prices will be at a fraction of the fares of the other airlines, so their actually compete on price; and they’re offering quicker connection times to the rest of Europe than the competition.  Plus their hoping to capitalize on the large Scandinavian population in the northwest upset by the departure of SAS, and looking for a tie to their heritage and roots.

Now in this economic climate any new airline route should rightfully be met with the right degree of skepticism and doubt–after all, we’re used to seeing massive cut backs of destinations, new airline orders, and service across the board as the airlines, like most other industries, fight to stay in business.  Still, it’s instructive that the market can simultaneously support companies pulling back while at the same time new business opportunities as well.  Icelandair saw an opportunity opened up by a competitor, and are seeing if they can take advantage of it.  I’ll be watching this as a case study to see what their marketing of this opportunity can teach me.

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