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For the first time a research was carried out to evaluate the impact of airline strategic alliances on their members in terms of branding as it is perceived by the airlines. For this purpose, a questionnaire was sent out to the marketing departments of all airlines participating in the three major airline alliances (oneworld, Star Alliance, and SkyTeam). It should be noted that 27 out of the 33 airlines completed the questionnaire, giving the survey an 82% response rate.
The most important finding of the survey was that the great majority of airlines (89%) perceive that their alliance branding affects their individual branding either positively or very positively, whereas the remaining (11%) perceive this impact as neutral and no respondent perceived it as negative. This finding is of extreme significance since this research proves that the reservations expressed in the industry of potential damage of the powerful brand airlines from their alliance brands is not shared by the airlines themselves. This was also supported by the fact that the great majority of respondents (78%) agreed that there are benefits in promoting the alliance as a single brand and particularly the fact that the gain brand power in markets that would normally experience little or no brand equity (brand power).
Nevertheless, some disbenefits from the alliance brands were also mentioned. These include: passengers’ confusion of having a more harmonised service from all airlines participating in the same alliances; that the alliance brands are strongly influenced by the dominant airlines’ brands; that the airlines lose a part of their individuality and that their image could be damaged. Moreover, most airlines (78%) believe that there are airlines that have to catch up with their alliance brand’s standards. Therefore, although that they consider that being promoted under a single alliance brand is beneficial to them, they still believe that the harmonisation of all members under the same quality standards and brand values will segment their alliance. These are all serious concerns that should be examined in detail.
Another very important finding of this research is that nearly all airlines (89%) do not want their individual brands to get absorbed by their alliance brand, signalling that the strategic alliances are the final destination of these co-operations and not an intermediate step for their merger.
An additional important finding is that nearly all respondent airlines (except one) believe that it is possible to maximise at the same time both their individual and alliance brands without having to maximise one at the expense of the other. The only airline which supported that it is not possible to achieve the simultaneous enhancement of both but it is necessary to maximise the one at the expense of the other has currently undergone a re-branding process and suffered from financial constraints. For these reasons, their distinctive answer could be understood.
In order to investigate for potential brand conflicts between the airline and the alliance brands, we asked the respondents to define the most important brand values for the airlines and for the alliances separately. The greatest difference between the airline and the alliance brand values are related with the importance that the place on their network size, which is far more crucial (30%) for the alliances than it is for the airlines individually (11%) and makes sense since one of the most important reasons why these strategic alliances were formed was to offer a global network with many destinations to their customers. The importance of a seamless travel for the alliance as a brand value (5%) in compare with its importance for the airline as a brand value (0%) reinforces this conclusion.
The importance of a carrier’s nationality is also an important value (11%) for the airlines but has no value at all for the multinational alliances. On the one hand, many airlines participating in the alliances are strongly associated with their country of origin, many of whom are known as their country’s flag carriers and have their nation’s name as part of their brand, i.e. Air France, British Airways, Alitalia, etc. On the other hand, the alliances have a global character and therefore have no association with any particular country or nation, although that the oneworld alliance has most of its members (five out of eight) coming from English speaking countries.
The reassurance related feature, has almost identical results with the nationality results, implying that theairlines want to maintain a closer relationship with their own customers and are not willing to give it away. This effect is possible to be influenced from the 11th of September 2001 event, since all carriers focused on their own survival and therefore had their alliance advancement as a secondary priority, which is also supported by the fact that after 2001 event it took nearly two years for the next entry in an alliance. Another possible explanation why the alliance brand is perceived to be associated only with a marginal reassurance value (2%) is that it has not yet developed the brand equity required for it. The results for the safety-related brand values which are double in importance for the airline (8%) in compare to the alliance (4%) reinforce the conclusion above.
Airlines were also asked to rate each of the following three elements (quality of service, service features and brand image) according to their importance in promoting their airline and their alliance brand values from a scale (0 = Not Important) to (5 = Very Important.
Quality of service was the highest rated category for both airlines (4.81) and alliances (4.38). The slightly higher importance of this feature for the airlines in compare to the alliances can be explained by the fact that the airlines understand that although consistency in the service quality offered from an alliance is very important, they understand that it is extremely difficult for this to be achieved and are willing to accept potential small variations.
The airline-specific image features are the second most important features among the three categories for the airlines with a high score (4.58), but are the least important for the alliances with the lowest score (3.88). This result reinforces the conclusion that the airlines’ images are not so importing for promoting the alliance brand values and therefore their diversity and distinctiveness is acceptable under the single alliance brands.
Although that the service elements are the third most important feature in promoting an airline’s brand values, their score is also very high (4.27) signalling their importance for the airlines. Their score is marginally higher for the alliances (4.31) and is placed second in terms of importance for promoting the alliance brand values. This marginal difference may be explained by the fact that there are noticeable differences between the service features between airlines belonging in the same alliance and some measures to reduce them or at least to control them would add to an alliance’s coherence.
The survey participants were also asked to rate the extent to which they perceive that a brand conflict exists between the airlines and their alliances in the same three elements. A five-point scale was also used for this purpose (0 = No Conflict) to (5 = Very Significant Conflict. No perception of significant brand conflict in any of these categories has been identified.
Although that the highest brand conflict between the airline and the alliance brands was identified in the service features (1.69), it is still quite a low score and therefore insignificant. This does not necessarily mean that the airlines see it as a damaging conflict, since it may be intentional in order to have a certain degree of differentiation between them. All alliances have established a minimum standard of service (seat-pitch, lounge, meals, in-flight entertainment, etc) so as to ensure product conformity.
The second highest conflict score was recorded for the airline image (1.31) which is even smaller and more trivial. Despite that each alliance consists of many airlines with diverse images, no conflict is perceived by the airlines reinforcing the previous conclusion that all alliance members are willing to maintain and are encouraging their diversity.
The smaller conflict was recorded in the quality of service element (1.23), highlighting that the airlines do not perceive that there is significant differences between the level of service quality offered by the same alliance carriers.
The most important findings of this research are that the majority of the respondent airlines believe that there are many benefits in promoting the alliance as a single brand. Most airlines also believe that there are other alliance members that have to catch-up with the remaining carriers’ brands. The great majority of airlines are currently satisfied by their alliance brand equity but still believe that it should be reinforced further but without exceeding their own brand equity since they are against of getting absorbed in the future by their alliance brands.
To conclude, this survey investigated for potential brand conflict between the alliance brands and their airline members’ brands according to the airlines’ perception. The survey’s findings highlighted that airlines do not perceive that any major brand conflict exists. Nevertheless, the passengers’ opinion on this matter should be identified, since as airline service customers, their point of view is far more significant on whether a brand conflict between the airlines and alliances brands exist.
Theodore is the Co-Founder and Managing Editor of TravelDailyNews Media Network; his responsibilities include business development and planning for TravelDailyNews long-term opportunities.
