Article published in today's Business Journal:
http://www.bizjournals.com/milwaukee...12/story1.html
Chocolate chip cookies vs. Larry the lynxFinding single identity for Midwest, Frontier all about reputations
The Business Journal of Milwaukee - by Rich Rovito
After months of speculation, the fate of the Midwest Airlines and Frontier Airlines brands is about to be determined.
Details about the move to combine Midwest, long touted as Milwaukee’s “hometown” airline, and Frontier into a single brand are expected to be revealed April 13 by the airlines’ parent company, Indianapolis-based Republic Airways Holdings Inc. Republic purchased Midwest and Frontier in separate deals last year.
Ian Arthur, Republic vice president of branding and marketing, recently told The Denver Business Journal, a sister publication of The Business Journal Serving Greater Milwaukee, that Republic will select either Frontier or Midwest as the name and that no other options are under consideration.
Republic spokesman Carlo Bertolini declined to say this week whether a name other than Midwest or Frontier is being considered.
The announcement could be the death knell for the Midwest brand. The Oak Creek-based airline built its reputation by offering business travelers an array of unique amenities, including complimentary gourmet meals, wine and champagne, wide leather seats and baked-on-board chocolate chip cookies. Nearly all of those amenities, with the exception of the cookies, have disappeared in recent years due to the airline’s on-again, off-again financial struggles.
The Midwest Airlines brand that attracted loyal supporters has disappeared and the Frontier brand has little presence in the local market, thus creating a dilemma for Republic when it comes to marketing the airlines to Milwaukee-area travelers, said Jay Sorensen, operator of IdeaWorks, a Shorewood airline consulting firm.
“Whatever Republic does is almost irrelevant,” said Sorensen, a former Midwest Airlines marketing manager. “In the Milwaukee market, they are essentially starting from the beginning.”
The deterioration of the Midwest brand has made it an “albatross” for Republic, Sorensen said.
The Midwest brand began to change following the Sept. 11, 2001, terrorist attacks on the United States when a subsequent downturn in air travel forced the airline to cut back on some of its offerings. But the airline remained unique enough to give it a competitive advantage and it garnered widespread community support as it fought off a hostile takeover in 2007 by rival AirTran Airways.
Midwest instead accepted a $452 million buyout from TPG Capital, backed by a passive investment from Northwest Airlines, which since has been merged with Delta Air Lines. In July 2009, Midwest changed ownership again when Indianapolis-based Republic Airways Holdings purchased the airline in a $31 million deal.
After fighting off AirTran’s takeover bid, Midwest’s financial fortunes took a turn for the worse. Blaming sky-high fuel costs, Midwest reduced the size of the airline, slashed jobs, dropped routes and grounded some aircraft and returned others to the manufacturer.
Nonetheless, Midwest continues to have more than 1.1 million frequent fliers, Bertolini said. “We’re definitely not starting from scratch.”
The frequent flier figure proves that loyalty to the Midwest brand remains strong.
“We recognize it’s not a blind love,” Bertolini said. “There’s a lot more than the name. You have to fulfill the promises behind the name.”
Bertolini admitted that some of the frustration with Midwest among consumers stemmed from service cuts. He noted that many of the routes that had been cut have been restored.
Unified brand
Republic is forced to decide which brand, Midwest or Frontier, has more equity. With a minuscule market share — 2.7 percent for February — at Milwaukee’s General Mitchell International Airport, the Frontier brand is relatively unknown to Milwaukee-area travelers. In Denver, however, the airline has passionate followers. Frontier supporters have held public rallies in recent weeks in an attempt to save the brand and the animal images, such as Flip the dolphin, Larry the lynx and Sarge the bald eagle, that adorn the airline’s jets.
Republic is faced not only with the task of combining two long-standing brands, it must also work to recapture customers who have felt alienated by Midwest’s dramatic changes in recent years, Sorensen said.
“It’s a branding buffet right now,” he said. “There are some planes with animals on the tail, there are some big airplanes and some small airplanes and cookies are offered on all flights. From a consumer perspective, it is so very confusing.”
Merging Midwest and Frontier into a unified brand is important for consumers, said Barry Bateman, director of General Mitchell International Airport in Milwaukee.
“If they can rebrand their product into a unified brand that has a common platform, it’s going to be best for them and best for the airport,” Bateman said. “Right now, it’s not a seamless operation and they know that.”
In developing a brand, it’s important to identify the attributes that set it apart from competitors, said Tom Branigan, president and chief executive officer of Branigan Communications, a Milwaukee public relations and branding firm.
“One of the first things you have to do is assess the marketplace equity of the brand and determine if it is financially viable or wise to keep them,” Branigan said. “Midwest had a pretty compelling brand. That’s the reason it was successful. In an industry as brutal as the airline industry, where margins are tight, it can be something as simple as the cookies.”
Having a clear, unified brand vision is essential, he said.
“You know you can’t be all things to all people,” he said. “You need to determine who your target is.”
Bertolini said a unification of the Midwest and Frontier brands is essential in order to reduce confusion.
“There’s some dissonance with passengers who travel between the two networks,” he said.
AirTran Airways, Midwest’s main rival at Mitchell, is almost certain to benefit as Republic works to combine the Midwest and Frontier brands, Sorensen said.
“This is allowing Milwaukeeans to leap into the arms of AirTran,” he said. “The brand is now known in Milwaukee and it’s consistent and stable. AirTran has really worked hard at this and everything is falling into place for them.”
AirTran is the No. 2 airline at Mitchell in terms of market share and is quickly closing in on Midwest.
“This is a great opportunity for us,” said Bob Fornaro, chairman, president and CEO of Orlando, Fla.-based AirTran Holdings Inc., which operates AirTran Airways.
“Our game plan is simple. We’ve been very, very consistent. The competition is showing a lot of uncertainty and it’s opened the door for us. Them going to one brand, one way or the other, is going to be a positive for us.”
The plans for combining the Midwest and Frontier brands will be unveiled at an event at Midwest’s hangar at Mitchell. Similar events are being held in Denver and Indianapolis, but Republic chief executive officer Bryan Bedford will make the announcement from Milwaukee, Bertolini said.
For additional coverage, see: AirTran Airways continues Milwaukee expansion