United Airlines has traditionally been a “full service” airline – targeting the middle of the market. Recently, United rolled out two additional classes of service. For those willing to pay more, United’s Polaris business class product offers spacious seats, fancy meals, a fancy lounge, and more. See an ad for Polaris below.
A few months later, United introduced Basic Economy – a lower price fare without reserved seats and no carry-on bags. Basic Economy helps United battle low-cost competitors like Frontier and Spirit, which have taken market share by offering no frills and low prices. United Airlines’ CEO Oscar Munoz explains the rationale for the Basic Economy service in the video below.
While United Airlines obviously thinks this is a good idea, at least one branding expert disagrees. Professor Tim Calkins critiques the strategy in the post at his STRONGBRANDS blog post “United’s Strategy: All Things to All People” (November 30, 2016).
In chapter 4 we stress the point that Calkins makes – “no one company can be all things to all people.” In chapter 2, we called that approach mass marketing which vaguely aims at “everyone” with the same marketing mix. United has adapted its marketing mix for these three segments – but each target market travels on the same plane.
Do you think this strategy will be successful for United? Why or why not?