CanadaEH
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Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 5:48 am

This summer is heating up to be one hell of a battle. Air Canada is expected to emerge from CCAA and add smaller jets, Zip is shifting its fleet from 737-200's to A319's, Westjet is adding LiveTV, moving its eastern hub to Toronto, and adding 12 more aircraft, Jetsgo is adding 18 F100's, and Canjet is "supposedly" adding 20 aircraft over the next two years (details have not been announced).

There are litterly dozens of reason for a passenger to choose an airline (customer loyalty, aeroplan points, frequency, comfort, entertainment, customer service) but how important is brand recognition? LiveTV is going to attract passengers to Westjet, DEEPLY discounted fares are going to attract passengers to Jetsgo, and interline/aeroplan points are going to attract passengers to Air Canada. What does Canjet have to offer? If all these airlines offer the same price, will customers go with the airline that has the most benefits/perks?

Who's at a greater risk of losing customers? Who's in the best position to win customers? What airline has the better strategy going into the summer? Comments anyone?
EH.
 
eddieho
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 6:13 am

Living in Canada myself I believe that Air Canada would have a bigger chance doing long haul flights than domestic / short haul. Frankly, most people just take the train around here.
 
FLYACYYZ
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 6:15 am

Given the trend of consumer preference and loyalty in Canada, it's been said before:

PRICE & SCHEDULE
PRICE & SCHEDULE
PRICE & SCHEDULE

Above and Beyond
 
Cessnapimp
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RE: Pictures Of Air Transat's New Color Scheme

Sun Feb 08, 2004 6:17 am

The airline at greater risk of losing customer is Air Canada. Unfortunatley, it currently has little do with the airline's ability to provide good value within its niche, but rather the complications the carriers unions set forth by obstinently standing their ground instead of negotiating with Trinity's lawyers regarding pension issues. If things keep going the way they are, Trinity will pack it up and leave. It's disconcerting especially due to the fact that CAW and CUPE seem (maybe someone can disspell this) to be acting without input from its members.

The airline with the most to gain from this summer is without doubt Westjet. This carrier has an excellent reputation already, and I see it slowly gaining popularity with YUL users to the expense of Jetsgo; a carrier with known logistics problems and a less than enviable OTP. Good luck in the triangle WJ!

I believe that C6 has their own frequent flier reward program. They have their supportive clientèle in YHZ, going to the days of Air Atlantic. I hope they do well and I look forward to seeing thier rumoured "flat-bottomed 56's" around the YYZ tarmac soon.
 
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yyz717
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 6:18 am

I agree with FLYACYYZ. No one really cares what airline they fly on unless they are deliberately building AP points.

Moreover, the Cdn charter market sells seats thru tour companies....many passengers don't even know which airline until the tickets arrive.
I dumped at the gybe mark in strong winds when I looked up at a Porter Q400 on finals. Can't stop spotting.
 
Whiteguy
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 6:23 am

So AC employees should just sit back and let Trinity do what it wants. The new contracts that were agreed to were on the basis that the pensions would not be touched. Trinity knew that when they invested in the company! Why should we give up more especially when Milty is getting a huge bonus.
 
Cessnapimp
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RE: Pictures Of Air Transat's New Color Scheme

Sun Feb 08, 2004 6:27 am

I'm not for sitting back, but I'm against the union taking a stand without input for its members. It's too easy to be bitter about the issue about the exec bonus; in reality, it has little to do with the situation.
 
Goose
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 6:27 am

What does Canjet have to offer? If all these airlines offer the same price, will customers go with the airline that has the most benefits/perks?

I may be wrong, but I think CanJet currently enjoys a status of the "Little Friendly Neighbourhood Airline" in the Maritimes, which WestJet used to have out West during its first couple of years, and still does to a lesser extent. Despite perks offered by other airlines, CanJet may have a type of brand loyalty, especially among Maritimers, which WestJet might have mixed results competing with.

And JetsGo will continue to attract people with its basement fares. A lot of folks have said that SG's current setup is unsustainable.... but then again, they're not really set up like WestJet, and Leblanc has very deep pockets. While WestJet is trying to steadily improve the quality of its product; LiveTV, increased overall seat pitch on the -700s - JetsGo is focusing on quantity of pax; pax that they realize will be attracted and retained by price alone......
"Talk to me, Goose..."
 
captaingomes
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 6:29 am

Yup, for the most part, price and schedule. But let's remember one thing. More and more, customers are purchasing tickets through airline websites. I wonder how many actually research ticket prices firsthand, or if they just automatically assume based on their prejudices "oh Jetsgo is always cheapest, I'll just go to jetsgo.net to book my flights." I would argue that with increasing use of websites, loyalty will also increase.
"it's kind of like an Airbus, it's an engineering marvel, but there's no sense of passion" -- J. Clarkson re: Coxster
 
Whiteguy
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 6:31 am

The input from the members came when the union leaders were voted into those positions. I know there are some decisions that unions make are not liked by the members, but when it comes to the pension there should be a fight.
 
FLYACYYZ
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 6:33 am

I agree with Whiteguy. I am not now nor have ever been a staunch unionist. In exchange for wage and benefit concessions, the pensions were NOT TO BE TOUCHED! Nobody disputes the need to be competitive, however the written word means squat. Surely the Trinity legal staff read the fine print before laying down $650 million??

Generally in the Asian culture, a deal and a contract are sacred. I guess granting Mr Li Canadian citizenship has re-defined his business ethics.
Above and Beyond
 
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yyz717
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 6:42 am

In exchange for wage and benefit concessions, the pensions were NOT TO BE TOUCHED!

In bankruptcy in any industry, nothing is untouchable. Even the seemingly sacred pensions are up for renegotiation particularly if they are underfunded -- and they usually are in bankrupt companies.

Why should we give up more especially when Milty is getting a huge bonus.

I honestly don't understand why the AC unions don't demand Milton's ousting. The unions have the power to boot Milton by refusing any further negotiations until he's gone.

In general though, whatever the new AC pension costs, productivity & pay, if you are making more thnan your equivalents at other airlines, AC will continue to lose ground, shrink, & remain unprofitable. It's become a commodity business...the spoils go to the low cost provider, rightly or wrongly.





[Edited 2004-02-07 23:07:12]
I dumped at the gybe mark in strong winds when I looked up at a Porter Q400 on finals. Can't stop spotting.
 
Cessnapimp
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RE: Pictures Of Air Transat's New Color Scheme

Sun Feb 08, 2004 6:44 am

An interesting situation indeed. I just hope I have a future by the time things settle. You guys are probably right, I'm not the best with regards to union dealings, darn CA's are too long to read  Smile ; maybe I shouldn't have brought this up.

But back to brand recagnition, last week brought us a flare of activities with reagrds to our country's carriers intentions for the summer. SG with with a dramatic increase in capacity, Westjet increasing its presence in the east and ZOOM's transatlantic plans. One has to wonder how Air Canada will retort this week. They need an announcement. Speculations? It's hard to plan ahead when CCAA concerns seem so overwhelming.
 
FLYACYYZ
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 6:57 am

YYZ717

You're absolutely right. In bankruptcy everything is up for grabs, and things change by the second. There is something however basically immoral when your C.E.O and his right hands are being made multi-millionaires at an accelerated pace, while the rest of the company is giving away the farm.
In the year 2004, senior managements salary and benefits should be directly indexed against the performance of any company.

Regrettably, it's not the Union that can oust our C.E.O, it's our shareholders.

I don't think any employee of any company in Canada, who in the last few years has had to give up pay or benefits, has done so with a smile on his/her face or without some degree of valiant fight.

P.S. Apologies..way off topic now!


[Edited 2004-02-07 22:59:43]
Above and Beyond
 
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yyz717
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 7:02 am

One has to wonder how Air Canada will retort this week.

There's not much they can do except continue to shrink. The ZIP A319's will actually shrink the AC fleet since the 732's will be retired while the 319's will not be replaced in the mainline fleet.

WJ is adding 11 more 73G's this year, Jetsgo 18 F100's. AC is only adding the much smaller CRJ-705 starting on Oct....which will not help AC since AC already has the industry's highest costs on similar sized aircraft let alone smaller aircraft.

Perhaps this is all healthy for the indusutry. In 3 years perhaps AC, WJ & SG will each have 25-30% market share....so we will have a truly competitive market with no dominant bully.

I dumped at the gybe mark in strong winds when I looked up at a Porter Q400 on finals. Can't stop spotting.
 
FLYACYYZ
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 7:06 am

The CRJ-705's:

Almost a foregone conclusion that they will be heading to JAZZ, so does nothing to boost the size/stature of the mainline carrier. The real fight will be over the ERJ's as the company seems prepared to avoid bringing the Brazilian babies into the mainline fleet. This despite a contractual agreement (and endorsed by Milton) that anything over 90 seats flys with the mainline carrier.

That issue is about to be slugged out later this month.

Stay tuned.
Above and Beyond
 
yegbey01
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 7:08 am

The 732's which Air Canada operates under Zip have been slated for replacement for a long time. By the time they are all phased out, the ERJ's will be reday to replace the A319's.

Brand is important, and AC has a good brand name. It carries the name of the country. This will ensure AC of getting strong loads on its international flights.
 
FLYACYYZ
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 7:16 am

The continuity of Air Canada as a long term and viable company is a combination of the following:

The customer willing to support the airline.

The employees willing to adapt to the "new world" of the airline business model.

Both are achieved by providing a competitive, cost effective, and conveniently scheduled product.

Brand was also I assume important to Swissair, and Sabena, who carried their respective flags across 5 continents, but did little to sustain their survival in their "previous" forms.
Above and Beyond
 
CanadaEH
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 10:20 am

The reason I asked about brand recognition is because of the difference in products and services the airlines are going to be offering this summer onward.

Air Canada is under CCAA and has a poor reputation - like it or not - of poor customer service. Air Canada is by far the most well known of all the Canadian carriers, simply because they've been the dominant airline and have been the only international airline for quite some time. They're the only carrier to offer business class seating in what is turning out to be a growing low-cost, single class seating only market - so they have that on their side. Mainline service does provide inflight movies for entertainment.

Zip was seen by many western Canadians as a poor attempt at copying Westjet and trying to put them out of business. Zip is nothing more than an extension of Air Canada and an airline within an airline with not a lot of 'Zipped' routes. Zip does not provide any inflight entertainment. (note: with a move to A319's, things may change in the long term)

Jazz is well known because for a lot of small, less populated cities Jazz is/was the only airline to provide service. Jazz is, much like Zip, recognized as an extension of Air Canada. Jazz does not provide any inflight entertainment.

Westjet is well known for starting the whole LCC thing in Canada and is also responsible for bringing all these low fares to pretty much all the cities they fly to. We all know that Westjet is "different" and to many people that's a welcome change - like it or not. Westjet will be offering LiveTV this summer.

Jetsgo is well known for low, low, low, low, low fares! Did I mention they're well known for low fares!? Aside from that, they don't have anything really distinct about their product. (note: I can't speak on behalf of their service as I've never flownt them.

Canjet seems to have a good following and a dedicated group of passengers in the maritimes. Customer service seems to be on par with Westjet and people generally feel good about their experience. Canjet is a somewhat small operation, however, and do no offer inflight entertainment.

And then there's the charter carriers Air Transat, Skyservice, and HMY which I won't get into..

Now, when it comes to an overall product (customer service, price, schedules, entertainment/frills, FF points, and aircraft as a whole package), will brand recognition be an important factor or will it be whatever is cheaper and more convienient?

Customers can be very demanding people and if the airline they choose to fly on listens to their demands, they'll gain loyal customers. As an airline, you also want a product that is "different" from other airlines. Will being "different" attract more customers? I think it will, which is why I think one carrier is going to have a lot of trouble this summer. Each carrier is unique in their own way, but with LCC's adding frills and keeping the cost of a ticket the same, passengers are going to expect more and go to where the value of their money is best.

EH.
 
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Vio
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 10:31 am

There are a few things that make me choose an airline. Having family in Ontario, I try to fly as often as possible. Westjet has direct flights to Toronto, London, Windsor. Somethimes the prices are outrageous, but having the option to fly to either of those three destinations make it easier. Usually, price dictates which airline I choose, but not all the time. Many times I book tickets with different airlines. At Chirstmas I flew JetsGo to Toronto (I don't want to talk about it), and one the way back, I chose Westjet.
I tell you what. Westjet employees, are among the nicest people I have ever met in my entire life. They really go the extra mile to make sure you enjoy the flight.
Superior decisions reduce the need for superior skills.
 
CanadaEH
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 10:41 am

Using your example, Vio, I'd assume you had a bad experience on jetsgo? If you were to fly again and Jetsgo offered a ticket @ $150 and Westjet offered a ticket @ $180, which airline would you choose? Would you choose Westjet if they had LiveTV? Would you go with Air Canada if they had a ticket @ $165?
EH.
 
Lucky727
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 11:36 am

IMHO, the regional loyalties mentioned above work because so many have a love/hate relationship with AC - which has never completely outgrown its image as a questionably-managed crown corporation. If we're going on branding alone, westerners feel a kind of local ownership of WJ, just like maritimers root for their local little guy CanJet. Is AC for business people? Do les Montréalais think of it with a hometown-based sentiment? Dunno.

Funny how during the assimilation of Canadi>n everyone dreaded AC's looming monopoly, and yet the industry seems quite dynamic with the current roster of players.

But a confession - while currently planning YYZ-LHR in May, AC didn't seem very on the ball re: offers for travel more than a couple of months from now - very uncompetitive pricing, while BA.com seemed to have a longer-term vision/plan. I'm now torn between BA (great price, and what's more - a first time flying a 777) and AC for the Aeroplan points. As a not-that-frequent flyer, the points are kinda secondary even though a search minutes ago gave me a price within $50 of BA. As an a.net buff, and a Toronto resident, with the huge range of options for one of "the most competitive transatlantic routes" it's now down to some misplaced feeling of patriotism/points value versus wanting to experience something different than what the status quo has to offer.

BTW - really fascinating to hear industry insiders' banter above. Cheers
··· [·] oooooooo [·] oooo oo ooooo [·] ooooooooooooooooooo [·]
 
planemaker
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 11:46 am

FLYACYYZ:

The AC EMB 190's are to seat 93 in two class so it wouldn't be too hard to take out one Y row (or two Y rows and replace with one J row for 88 pax total.)
Nationalism is an infantile disease. It is the measles of mankind. - A. Einstein
 
CanadianNorth
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 3:46 pm

Personally, i think everyone has a chance. I feel that some of the airlines that might get the best chance are the smaller airlines such as Canadian North and them, which with all the diamond production opening up and exploration on the rise in the NWT and parts of Nunavut, can make a half decent chunk of change off of their Cargo and Charter services throughout the north.

From what i see, i think Westjet has a good chance, they are profitable and half a half decent product for a not too bad price. And it never hurts when many of yer employees are happy to help. A half decent product that is standing behind a half decent reputation.

And after that, Air Canada probly worst off. Overall, the Air Canada product isnt that bad, its more the fact that few of the staff enjoy working there and that since the Canadi>n merger theres been alot of people who are less than pleased with the company. Its a good product but its standing behind a less than great reputation.



Just my 2 cents
CanadianNorth
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Mark_D.
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RE: Canada: How Important Is Brand Recognition?

Sun Feb 08, 2004 11:14 pm

CanadaEH-- This summer is heating up to be one hell of a battle. Air Canada is expected to emerge from CCAA and add smaller jets, Zip is shifting its fleet from 737-200's to A319's, Westjet is adding LiveTV, moving its eastern hub to Toronto, and adding 12 more aircraft, Jetsgo is adding 18 F100's, and Canjet is "supposedly" adding 20 aircraft over the next two years (details have not been announced)...Who's at a greater risk of losing customers? Who's in the best position to win customers? What airline has the better strategy going into the summer?


Things are still so up in the air -- no pun intended-- that unless (Heaven forbid) any of 'em has a real catastrophe or something over the next several months, I don't think even the management of the carriers themselves much know how and where things are all going to shake out. And assuming there are only maybe a few minor problems --like perhaps cash-flow issues-- during that time, I guess it'll be around the end of the year before "winners" and "losers" or "water treaders" labels can start to be pinned on the players in question.

I hope CanJet makes their fleet-upgrade announcement imminently --say in the next month or so-- since even though they're by far the smallest player, that question of what planes they're going to get is about the biggest one, bigger than even Jetsgo route announcements using their F100s.

Jetsgo does seem to need to add a bit of 'tender loving care' to their contingency customer service, and I hope they address that and pronto since they're going to need all the positive customer experiences they can get, to help fill those F100 seats in the earliest possible goings. Having said that though I'm way more confident about their viability in the Canadian domestic market, flying those around rather than the MD80s except for the longhauls. Canada --especially in a now-getting-crowded market but even if not -- really is a F100-sized marketplace for the vast majority of the routes flown. A "poor airline's" Embraer 170/190, if you will.

And Jetsgo seems to be doing basically quite well indeed using the MD80s on the Sun routes. I hope that was what they had in mind for them all along, right from the early goings in their business plan so that what they're doing now with the F100s is just another step in a long-thought-out process.


CanJet I guess can cruise on its good rep --and mini-frequent flyer plan-- for a while, though that fleet announcement of theirs will be huge, and until and unless it's revealed I guess they're still sort of an enigma overall.


AC, the soap opera continues of course  Smile Who knows. From the pension thing to possibly-ongoing-bad quarterly numbers to not that great a customer service rep themselves these days -- not to mention them being still sort of a lumbering behemoth of an airline generally-- there are all kinds of twists and turns that their fortunes could take this spring and summer. I don't even want to hazard a guess -- it's just too week-by-week as far as I'm concerned!
LOL

Though most people in Central Canada who are over fifty or older I think are and will continually to be weighted in favour or taking Air Canada over anybody else, even if there's a bit of a price premium to do so.



Westjet, what can anyone say, seems to some extent "the legend continues". At YUL they're already like Canadian (and CP Air) used to be, namely THE number 2 fixture after Air Canada, in the domestic part of the terminal. And this after just being in town not even a year now --they're really doing great.

Almost a shame that YUL's domestic facilities is still basically the same ol original 40-year-old setup -- with AC hogging the (30 year old) domestic pier, SG C6 and even-bustling Westjet all have to contend with being marooned out at the (increasingly-laughable) aeroquay. The Airport IS apparently going to be building brand-spanking-new check in counters in the domestic side of the terminal at least, this summer -- but only for AC . That whole side really needs to be done from scratch there -- but who knows if it will be and even there, probably two or three years away in any event. Ah well, what can ya do sometimes Smile

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