Magazine article Marketing

British Airways on the Backfoot over Pricing: British Airways Is Taking Steps to Recover Business from Its Low-Cost Challengers. (Analysis)

Magazine article Marketing

British Airways on the Backfoot over Pricing: British Airways Is Taking Steps to Recover Business from Its Low-Cost Challengers. (Analysis)

Article excerpt

If British Airways chief executive Rod Eddington sneezes it will make the papers; so when he fundamentally restructures the UK's biggest airline, the media goes into a frenzy.

BA's decision last week to cut a further 5800 jobs, slash ten routes and make cost savings of [pounds sterling]650m by 2004, was the big business story of the week. What has not been analysed so closely, however, is the marketing challenge lying behind it.

It is no coincidence that BA's chief marketer Martin George has been given a central and expanded role in the new business direction for the airline.

Certainly BA has operational and cultural issues to overcome, but it will live or die by its ability to reverse the widely held perception that it is an expensive airline.

"We already have some highly competitive fares on our web site, but there is still a perception that we are overpriced," says George.

Many argue that BA dug itself into this hole in the first place, particularly when both the current and the previous chief executive have made such a play of focusing on premium passengers.

While BA has focused its TV advertising on products for business travellers and its PR on the high-profile relaunch of Concorde, competitor airlines such as Ryanair, easyJet and Go have blitzed newspapers, billboards and train stations with ads showing their low prices to Rome, Paris or Madrid.

Ryanair even ran a comparative ad accusing BA of being 'Expensive ba*****s' and easyJet used a campaign saying 'It doesn't have to BA rip off'. …

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