After I left the airline I had the pleasure of having Mars as a client for over 25 years. During that time I learned a great deal about this giant company, a leader in confectionery (Mars Bars, Milky Way etc), rice and main meals (Uncle Bens, Dolmio etc) and petfood (Pedigree, Whiskas etc).
One of the sad facts of life for Mars is how difficult it is to create a new product, and in fact Mars’ main product names have been around for years - I exclude Starburst which are renamed Opal Fruits, Snickers which are renamed Marathons and Celebrations which are only small versions of their main brands. During the time they were clients, we must have been involved in a dozen or so new product launches, all of which were delicious products, great campaigns but sales failures.
One important reason is that in today’s crowded marketplace, dominated by expensive media, the cost of the product (roughly 50p) can only justify long term advertising and marketing support if it sells in bucketfuls right from the start. If it doesn’t the product is dropped.
That isn’t the strategy that works in the airline business. The infrastructure costs involved in starting a new route, let alone a new airline like Open Skies, demands in-depth market research, long-term commitment, determined and steady development. It certainly demands clearer thinking at the top than BA shows it is capable of giving.
Mars spends a great deal of money testing new product ideas - obesity amongst the housewives and children of Slough must be a perennial problem!
In contrast and on the evidence available, marketing at British Airways is driven by the latest travelogue the management have seen on TV or the latest idea a competitor has dreamed up. How much serious market research is made into the viability of new routes/airlines?
Look at the bases on which Open Skies was started.
Concept - the premium class airline concept had already failed twice in as many years.
Routes:
Amsterdam - New York - probably the most efficient and well-known hub in Europe, the home of an airline renowned for customer service.
Paris - New York - has Mr Walsh ever been to France? Does he not know how insular the French are? And does he know how second rate Orly is compared to CDG? This decision alone makes Mr Walsh look like the man who bought London Bridge for Lake Havasu all the while convinced he’d purchased Tower Bridge.
Given this level of naivety (and his evident antipathy for unions both before and since he became CEO) is it conceivable that Mr Walsh forced through the launch of Open Skies as a device to beat BALPA over the head rather than as a serious and balanced attempt to create a new airline?
Now, little more than 12 months since launching the airline and barely six months after starting Amsterdam-New York, BALPA is accepting shares instead of pay and Open Skies is clouding over. Decisions like this suggest a complete lack of market research and corporate panic at the very top.
And this is the company into which pensioners have just sunk over £300 million of guarantees!
Saturday, 25 July 2009
Thursday, 16 July 2009
The Sales Team to turn BA around
The cries for Mr Walsh to quit rose to a clamour at this week’s BA AGM and it’s hard to see how long he can resist them.
At the same time the futility, even incompetence of the airline’s sales policy shines like a beacon of idiocy - only yesterday in Los Angeles BA announced it is giving away 1000 seats to businessmen to “persuade them of the value of face-to-face meetings”.
Do the Sales Wizards at BA really imagine that businessmen don’t know these things and that they aren’t travelling BA in particular for entirely different reasons? Is giving seats away the height of brain power in BA Sales?
Such stupidity lies at the root of BA’s problems. They let the drivers and the MBA wallahs run the airline. Don’t they watch TV or read the business pages? What are the commonalities shared by the Dragon’s Den gurus, by Sir Alan Sugar, by Sir John Harvey Jones from another generation, or by Stuart Rose or Philip Green? They all know that if their sales teams aren’t functioning at their very best, ie selling, not giving the stuff away, their enterprises are doomed. (If you want a great example look at M&S. Following a short-term reduction in prices to get the punters back through the doors, Stuart Rose has driven revenues and profits by improving the product, the buying experience and the confidence in the brand. Compare that to Paddy Survival’s strategy.
This blog has been saying for months, even years that the short term solution to BA’s problems, once they’ve raised enough money to finance the next few months, is to get rid of the CEO, give the entire passenger handling job to an agency and hire a team of old-fashioned sales people.
Anyone who, like me, spent 30 years after the airline in business, could nominate such a team within a week. They’d be superannuated grey-beards who’d have to be tempted back from the golf course but salespeople don’t change underneath. They remain people who can inspire and motivate others to want to walk through walls to meet their sales objectives. In 30 years of making television and video programmes, many for big blue-chip companies, I’ve met scores of such people. They’re out there and they could turn BA round.
At the same time the futility, even incompetence of the airline’s sales policy shines like a beacon of idiocy - only yesterday in Los Angeles BA announced it is giving away 1000 seats to businessmen to “persuade them of the value of face-to-face meetings”.
Do the Sales Wizards at BA really imagine that businessmen don’t know these things and that they aren’t travelling BA in particular for entirely different reasons? Is giving seats away the height of brain power in BA Sales?
Such stupidity lies at the root of BA’s problems. They let the drivers and the MBA wallahs run the airline. Don’t they watch TV or read the business pages? What are the commonalities shared by the Dragon’s Den gurus, by Sir Alan Sugar, by Sir John Harvey Jones from another generation, or by Stuart Rose or Philip Green? They all know that if their sales teams aren’t functioning at their very best, ie selling, not giving the stuff away, their enterprises are doomed. (If you want a great example look at M&S. Following a short-term reduction in prices to get the punters back through the doors, Stuart Rose has driven revenues and profits by improving the product, the buying experience and the confidence in the brand. Compare that to Paddy Survival’s strategy.
This blog has been saying for months, even years that the short term solution to BA’s problems, once they’ve raised enough money to finance the next few months, is to get rid of the CEO, give the entire passenger handling job to an agency and hire a team of old-fashioned sales people.
Anyone who, like me, spent 30 years after the airline in business, could nominate such a team within a week. They’d be superannuated grey-beards who’d have to be tempted back from the golf course but salespeople don’t change underneath. They remain people who can inspire and motivate others to want to walk through walls to meet their sales objectives. In 30 years of making television and video programmes, many for big blue-chip companies, I’ve met scores of such people. They’re out there and they could turn BA round.
Subscribe to:
Posts (Atom)