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Merger muddles Republic Airways' branding
Until airline makes decision, fliers still uncertain whom they are flying: Frontier, Midwest or Republic?
By Ann Schrader
The Denver Post
Until airline makes decision, fliers still uncertain whom they are flying: Frontier, Midwest or Republic?
By Ann Schrader
The Denver Post
Customers complain they book flights on Midwest Airlines' website, but Frontier Airlines' white-fuselaged Airbus jets are at the gate and Republic Airways flight crews greet them when they board.
Adding to the muddle is when a smaller Republic Embraer jet is used on a flight and has none of the signature attributes of Frontier or Midwest.
Call it brand confusion.
Even Bryan Bedford, Republic's chief executive, admits, "We're just as confused as everybody."
Bedford said in recent interviews that a branding decision — largely based on surveys of 30,000 people across the nation and employees — will be made sometime next month.
"We want to know what is it that they value," Bedford said, about what he calls "two well-loved brands in their home markets."
The two airlines' frequent fliers — 1.7 million of Frontier's EarlyReturns members and 1.1 million of Midwest's Midwest Miles members — are being asked whether they cherish Frontier's seatback TVs, or whether they're smitten with Midwest's chocolate-chip cookies.
"We want to find out if the cookie is relevant," Bedford said, confiding the cookies are only warmed up in flight and aren't actually baked in the air.
The aim is to "harmonize" Frontier's and Midwest's brands beyond the codesharing common among independent carriers.
At first, the integration plan called for maintaining two separate brands. Now, said Republic spokesman Carlo Bertolini, "We wouldn't rule out anything."
One possible action could be flying under one name.
"That is something we would have to consider," Bertolini said. "There are a couple of different routes: reinvent the wheel and create a new brand, maintain both, or one. What is decided will focus on what is best for customers."
At several recent investor conferences, Bedford acknowledged "short-term inconsistency" for customers but said that is outweighed by approval of new routes and destinations created by the integration.
"Republic is moving a lot of pieces around the board," said William Swelbar, research engineer for the International Center for Air Transportation at the Massachusetts Institute of Technology.
Bedford and his team seem "truly focused on Frontier and Midwest, and making that transition. It's not an easy one," Swelbar said. "Bedford has to kind of build an airline, and that's a little confusing for passengers."
Swelbar cautioned the confusion can lead to erosion of the community's allegiance to a "hometown" airline. For Frontier, he said, that loyalty "really is the franchise."
Passenger Jeff Evans of Denver said if the Frontier name and image are dropped, "so will any remaining loyalty I had. I am committed to not fly Frontier until it is clear what will become of the brand because of it no longer being Denver's hometown airline."
In January, Republic announced executives will move to its Indianapolis headquarters and several Frontier leaders would leave, including Sean Menke, who guided Frontier through bankruptcy.
Integration in the eyes of the public has challenges.
Midwest has been primarily a business carrier, with about $400 million in annual revenues. Frontier excels as a leisure carrier, with $1.3 billion in annual revenues.
Midwest recently was rated the No. 1 domestic carrier by Zagat and No. 3 by Conde Nast.
Milwaukee's convention center touts Midwest's name. But the beer-and-bratwurst city has disengaged a bit from the airline, reeling when Midwest scrambled for survival by furloughing employees in 2008.
More job losses came after Republic purchased Midwest on July 31, by then a shell of its former self.
As a poster on flyertalk.com noted: "There is not much of the old Midwest left — I've even read that sometimes the cookie is cold."
Frontier was born in Denver, which was supportive of the company, its employees and cuddly, talking tail animals during bankruptcy that ended Oct. 1 when Republic bought it.
Communication with employees is a good way to maintain service and brand loyalty during change, said Cyndi Fukami, management professor at the University of Denver Daniels College of Business.
"There is some pretty good data that indicate merging companies is not a very successful practice," Fukami said, with corporate cultural differences as a reason for disharmony.
Involvement of employees, who are a company's public face, cuts the likelihood of cultural problems, Fukami said.
"It's a matter of how they are being led, how they are being treated," Fukami said. "Frontier did act like a family, and that's a tough act to follow."
In the airline industry, brand-name loyalty is not a big issue, said Donald Lichtenstein, marketing chairman of the University of Colorado Leeds School of Business. "People shop airlines based on convenience, schedule and price."
Lichtenstein said he would pick one brand to avoid consumer confusion and he'd make that move quickly.
"The notion is to give consumers confidence that it is a coordinated airline where things are under control, that things are done smoothly and it is a safe, reliable airline," Lichtenstein said
Read more: http://www.denverpost.com/business/ci_14438940#ixzz0gCkSjN9E
