In February’s Maneuver Marketing Communique, I described the United Airlines campaign. If you recall United’s ad agency had issued a press release outlining competitively sensitive details about their campaign including all of their planned activities for the next 12 months. I commented on the rigidity of their plan, the advisability of disclosing sensitive plans and the self-promotional motivations of their ad agency. Fast forward to July 15. Two press releases from United caught my attention.
The first was a release trumpeting the nomination of a United TV commercial for an Emmy award. This Robert Redford narrated spot was beautifully crafted and enjoyable to watch. But it did absolutely nothing to differentiate United from other competitors. John Tague, executive vice president of marketing, sales and revenue commented on how this nomination was a great testament to reinvigorating the United brand.
The second press release was titled: United Postpones Quarterly Pension Payment. It seems as if United is in such dire straights that they can’t even make a pension payment due their rank and file employees. But they do have the cash to pay Robert Redford and Emmy award seeking agencies for branding efforts that will never move the needle.
The pension release was dated July 14. The Emmy nomination release was dated July 15. Now Mr. Tague, who is responsible for marketing, sales and revenue had to be aware of the missed pension payment when he OK’d the Emmy release. What was he thinking? That employees who’s pension is already at risk and suddenly not being funded will be pacified by the fact that one of their ads was nominated for an Emmy?
The point of this little rant of mine is how far off-base many marketing professional have strayed. What in the hell does reinvigorating the United brand mean to a company in bankruptcy and out of cash? I don’t know Mr. Tague, perhaps there’s a logical explanation for what took place, but for a company in United’s position to be spending tens of millions of dollars on a questionable branding campaign while missing a pension payment is totally irresponsible.
(Coincidently, as I am writing this, BtoB the marketing journal, just reported on a new study by the Association of National Advertisers and Forrester Research. The study found that the majority of marketers can’t agree on how to measure their marketing return on investment. The reason for this and its connection to United is that many marketers have learned that if they did come to an agreement on measuring ROI then they would have to create campaigns that were effective and profitable. And lead to embarrassing questions like how does an Emmy award increase our ROI? Or at the bare minimum generate enough cash to make a pension payment?)
So the problem is an out-of-touch marketer squandering the precious resources of a bankrupt corporation struggling to survive in a draconian marketplace. What is the solution?
01. Timeframe. When a company is bankrupt and 30 days out from being liquidated you do not have the luxury of launching questionable branding initiatives. In this environment you need to align your resources with a realistic timeframe. In other words every marketing dollar spent today needs to generate revenue tomorrow.
02. Creative. You do not need Robert Redford and exquisitely crafted TV spots to generate revenue. Creative efforts need to be respectable (not award winning!) and wickedly fast. Most importantly the creative needs to evolve and change in real time. So production techniques requiring weeks and months should not be used when your campaign cycles are hours and days.
03. Competencies. Integrate your sales and marketing departments. For short term tactical situations – like avoiding liquidation – aggressive sales instincts and competencies need to lead the over all effort.
04. Short Term Bias. The sales and marketing team needs to have a tactical survival bias. This include unambiguous objectives, sharply defined positioning and highly-energized team members.
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Some of the claims you make are outrageous. You look clueless today, as UAL is going to come out of BK with revenue costs equal to that of South West
Hi Tuolmne,
Which claims do you consider outrageous? Tell me more about your background and experience so we might debate our point of views.
“Timeframe. When a company is bankrupt and 30 days out from being liquidated you do not have the luxury of launching questionable branding initiatives.”
Case and point. I am not discrediting your knowledge in the marketing world, but you really need to know what you are talking about before you make comments like this. At the time of you writing this article, that statment was both unfounded and had no footing. United was never “30 days away from liquidacion”.
Hi Tuolumne,
Throughout the process Chapter 7 liquidation was always an option. Whether it could of occured 30 days or 90 days from the date of the original post can be debated, but is not the focus or the purpose of my point.
Couple of other points… I think it is improper to allow a comapny to use bankruptcy to discharge its debts and obligations and then return to the market and compete against those who have not chosen this path.
Also, I think their new strategy of offering premium services (leg room, interiors, etc) will be interesting to watch.
A possibility yes, but for all intensive purposes, it really was a distant one.
UAL Corp. today emerged from bankrupcy a leaner, more efficient carrier, retaining all of their crucial assets (LHR rights/Asian routes), as well as introducing a multitude of new products (Ted, PS, ExPlus, etc.). United is poised to once again become America’s premier carrier, and if Bankrupcy was needed to get there, then so be it. Continental filed for Ch. 11 twice, and NWA/DL are in Ch. 11 currently. I do not completely agree with the way the law is written, but United was close to liquidiacion the time they went in (mind you this was not the time they unveiled their new ad campaign).
Now back to ads…United will continue it’s campaign, running it’s first Super Bowl television spot in a decade. Furthermore, new print/television spots have already been unveiled. United has a strong brand identity that no other carrier in North America has; I like to believe Rhapsody in Blue has a lot to do with it, but that’s just me.
Tuolumne,
You said United “was close to liquidation” then say liquidation was a “distant” possibility. Liquidation was always a realistic option until the last ruling by the BK judge. But we must agree to disagree on this.
As to the rhapsody campaign… yes, I can say the campaign is pleasant and well executed. But, the campaign does nothing to differentiate UA from AA, Jet Blue etc., etc. I will speculate that the UA marketers are (or should be) launching a new effort that truly distinguishes UA and most importantly begins to reclaim the lustre of the pre-BK UA brand.