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“We don’t distinguish between ‘business’ or ‘leisure’ travelers, says JetBlue Marketing VP Elizabeth Windram. “At any given time, we are all these things. Instead, we look at the specific human needs as opposed to why someone is traveling.”
The nature of classifying fliers by travel purpose is becoming fairly obsolete in the face of demands that airlines provide a more personalized customer experience, JetBlue Marketing VP Elizabeth Windram told the audience at an Advertising Club of New York panel discussion in May.
In addition to Windram, the panel, a part of the Ad Club NY’s The Verticals series that explored how travel brands can create “differentiated booking experiences,” featured Anna Frenkel, North America Marketing Lead, Airbnb; Courtney Lowell, Head of Communications, Silvercar by Audi; and moderator Alia Lamborghini, VP Industry Lead, Travel & Disruption at Verizon Media.
Prior to the panel discussion, Michael Leszega, manager of Marketing Intelligence at IPG Mediabrands strategic unit, MAGNA Global, broke down the advertising challenges facing travel brands generally and airlines specifically as the hospitality joins other major marketing categories in adjusting to shifting digital demands.
Airlines Are Cutting Ad Spending
Putting a greater emphasis on personalization and customer experience by airlines are viewed as a way to generate more passenger bookings as carriers cope with shrinking marketing budgets.
In terms of spending, travel accounts for just 5 percent of the total $200 billion U.S. ad market (roughly $11 billion) in 2018. Though a smaller fraction than other industries such as retail, financial services, and tech, travel is nonetheless one of the main growth drivers of total ad U.S. sales.
Within travel ad spending, airlines are an outlier versus hotels, cruise ships, and “miscellaneous,” Leszega noted.
“Three out of those four sub-categories in travel have been increasing their ad budgets year-over-year,” Leszega said. “Airlines, despite a record number of passengers, are reducing spending as rising energy prices are forcing a cost-cutting mindset.”
Instead of traditional media, travel budgets are moving towards more performance-based marketing, such as search. And that is where the call to be viewed as “differentiated” is being heard the loudest.
Advertising Club of NY's Travel panel: Anna Frenkel, North America Marketing Lead, Airbnb; Courtney Lowell, Head of Communications, Silvercar by Audi; and Elizabeth Windram, Vice President Marketing, JetBlue Airways
The JetBlue Difference
Verizon’s Lamborghini put the question to JetBlue’s Windram: JetBlue is known for offering wider seat room, in-flight entertainment. But what does the airline focus on in terms of delivering a distinct profile to domestic travelers?
“We were born out of an opportunity to differentiate domestically,” Windram said. “20 years ago, the air travel space was in a dire situation. Maybe some of you still feel that way. But we try to give our travelers a little bit that adds up to a lot in terms of comfort and caring. For example, at JFK’s Terminal 5, we have a lot of great concessions [and we expect to add more prominent brands soon].
“While air travel for most carriers is just about what happens in-flight, the ‘JetBlue experience’ is total service from booking to departure to arrival. And where a lot of other airlines are taking things away, like reducing legroom to get more seats on the plane to increase revenue in the face of rising fuel costs. But as competitors catch up, we need to continue to drive our identity around meeting traveler’s specific needs. That’s how JetBlue stands apart.”
Obliterating Distinctions, Redefining Premium
While striving to be recognized for its “caring and comfort,” no matter how many people tell Windram about their “love for JetBlue,” she concedes that “the number one factor people look to when choosing who to fly with is price. “It’s difficult for any brand to overcome price, especially airlines. Our mission is to make sure all the services are more appealing so customers will see the value.”
Since “value” is in the eye of the beholder, particularly when it comes to travel, the idea is to erase arbitrary distinctions like “leisure” versus “business,” Windram said. The need to align the flying experience along personalized needs and expectations is also upending traditional strategies around “premium” bookings.
“We don’t distinguish between ‘business’ or ‘leisure’ travelers, says JetBlue Marketing VP Elizabeth Windram. “At any given time, we are all these things. Instead, we look at the specific human needs as opposed to why someone is traveling.”
As JetBlue lays the groundwork for its expansion from domestic service to transatlantic in 2021, the airline is likely to look to the success of its MINT “premium class” program. The airline has been profitable with prices that are “30 percent lower with a better product," one source told Kambr Media when JetBlue previewed its European service plans.
“I don't spend a lot of time thinking about premium or luxury,” Windram told Kambr Media. “We spend a lot of time thinking about offering value at whatever price point you choose within our network. With MINT, we launched our take on a premium service. When we began planning for transcontinental, we were able to notice that the price points being charged for those flights in business class were very high. So we thought we could do better with our product.
“We came in with MINT and we launched lie-flat seats. We have amazing food from (upscale NYC restaurant) Saxon and Parole. We have our signature service, but we really stepped it up a notch to over-deliver to MINT customers,” Windram continued.
“And we did not invest in a lounge: We're about winning with the in-flight experience, but with a very affordable price point. It’s higher than the rest of JetBlue services, but we'll add $599, $699 to fly transcon, which is an area under the curve of all those people who said, At that price, suddenly I'm in the market.' We think we can apply that MINT concept when we go transatlantic.”
JetBlue's Elizabeth Windram
On The Evolution Of RM
Following the panel discussion, we caught up with Windram to discuss how the marketing and revenue management strategies are changing within the airline industry generally and at Jet Blue.
In terms of the structure of the relationship, JetBlue’s marketing department is part of the commercial team, which includes revenue management, along with network and scheduling.
“We are very much a team, and the RM network staffers are my closest partners,” Windram said. “Airlines have been ahead on making these kinds of inter-disciplinary connections with each other. In a lot of industries, things have been separated out, siloed, where you have the Chief Marketing Officer on side and a Chief Revenue Officer on another. Our industry has more of a tradition of a chief commercial officer that leads demand generation.”
Is there anything that needs to change when it comes to how those pieces are organized within an airline?
“When you think about it, sometimes I think we should rebrand the whole thing as the ‘marketing department,’ but the RM team and the network team don't like that,” Windram responded. “I say it, not flippantly, but because when you think classically about marketing, it's about the ‘Four P’s’: product, price, place, promotion. Pricing is a big part of what we do. Product is where we fly, when we fly. Then the product elements that marketing brings to it inform the experience and how we tell our story – so that plays in promotion. It does all knit together.
“When we talk about the overall value proposition and strategy for JetBlue – the ability to offer a great product at a great price – I can't do it without RM and network. We're very close partners. And we have a lot of heated arguments and conversations. But in the end, we make it work for our customers and solving those internal debates are the reason why.”
