Marketing and Advertisement ? Can a company be successful without it ?

[tipsy.skipsy]

One of my strange but unavoidable thoughts. Please be patient with me.

If a well established company like Qantas ( Qantas branded products and services only) excluding subsidiaries like JetStar - shut down all of its marketing and advertising departments , have no marketing advertising budget next year !!! :shock::shock::shock:

And use all the money saved with effect to :-

1) Add more value to its baseline products.

OR

2) Reducing ticket prices.

Do you think it can be a good idea ??

 

[harvyk]

This would be a very hard call,

First of all, what do you define as marketing? Something that exists only to create brand awareness, or anything which could be construde as branding and marketing in any form?
For example, having their flights listed under flight booking sites (eg Webjet) could be counted as marketing, but it's also a very valid method customers can use to book flights with QF, so where would that sit?

My thoughts are yes, they have pretty big momentum, and most people know of Qantas, even if it simply "that was the airline in Rain Man", so they could survive, that said adding value to it's baseline product won't do much good unless you tell people that you've done it, and reducing ticket prices is a very quick way to get into a race down to the bottom, and very few airlines survive such races.

Of course the other way to look at it, given QF is a business to consumer (B2C) company marketing can work quite well, they probably wouldn't have invested so much money into marketing without getting some return on their investment.

 

[Mal]

Looking at companies like Facebook or Linkedin, even Ebay (to an extent ... they did start advertising), they don't need to advertise to be successful.

If flight booking wasn't as open as it is now (ie it was still controlled by TA's), then advertising may not be required either - just ensuring that the TAs recommend Qantas.

However, consumers are savvy now. They need constant reminding to use Qantas - otherwise they'll just go to the first airline website they think of.

So yes, I think advertising is very important for Qantas.

 

[tipsy.skipsy]

First of all, what do you define as marketing? Something that exists only to create brand awareness, or anything which could be construde as branding and marketing in any form?
For example, having their flights listed under flight booking sites (eg Webjet) could be counted as marketing, but it's also a very valid method customers can use to book flights with QF, so where would that sit?

By that I mean any form of marketing where Qantas would spend money for eg. ( advertisement , print , broadcasting , publication , brand ambassador etc )

Buy this I mean follow a mantra of Micro-Advertising by that I mean fire 95% of people from the marketing and advertising .. reduce the marketing and advertising budget to less than 5% of what it is now. Just keep the 5% of the staff to do the following tasks.

1) Social Media Marketing
2) Brand Management
3) Online Marketing etc etc.

use the 95% of the saved money to either improve the baseline product or reduce fares , or put money to some other use.

Was just wondering if this can work ??

 

[samiam]

use the 95% of the saved money to either improve the baseline product or reduce fares , or put money to some other use.

What sort of tangible benefits would there be for shareholders or executive incentive plans, in diverting such savings elsewhere? Decreasing costs as suggested could (in the short term) improve the margin and other financial indicators that analysts use to measure listed companies' performance (think 'for sale' sign).

One would have to question the sense of this strategy in the long run.

For a company that has spent a number of years reducing the baseline product (refer to threads on seat pitch, meals, cabin crew numbers, etc), I think it an unrealistic commercial proposition for any savings (from marketing or elsewhere) to be redirected to improving the product or reducing fares, without a fundamental change in long-term strategy (read Board & CEO).

 

[harvyk]

By that I mean any form of marketing where Qantas would spend money for eg. ( advertisement , print , broadcasting , publication , brand ambassador etc )

Buy this I mean follow a mantra of Micro-Advertising by that I mean fire 95% of people from the marketing and advertising .. reduce the marketing and advertising budget to less than 5% of what it is now. Just keep the 5% of the staff to do the following tasks.

1) Social Media Marketing
2) Brand Management
3) Online Marketing etc etc.

use the 95% of the saved money to either improve the baseline product or reduce fares , or put money to some other use.

Was just wondering if this can work ??

If your keeping those 3 things going then you’re not really doing without marketing, your simply firing a whole lot of people (which is expensive) and doing a half ared job with what you have left.

Marketing is an often misunderstood component of business (no thanks to the majority of marketers who often work in those areas deliberately obfuscating things), marketing exists for one purpose only, to drive sales. So whilst I think a review of marketing activities is a must for any business, and turfing any activity which does not directly and measurably drive future sales is a must, it is still a nessacery component as it ultimately helps QF sell seats on their services.

As for brand management QF aren’t really doing that now, otherwise we would see far less news limited stories. Brand management has little to do with fonts, colours and logos, and far more to do with public preception of your company, be it good (eg QF “never crashing” thanks to rain man) or bad (QF in news limited stories every second day).