Branding and business sense: Delta Air Lines

It's good to hear that Delta Air Lines has emerged from bankruptcy.  I've flown a lot of miles and many of those have been on Delta (I was a management consultant based out of Atlanta).  As part of their re-birth, they're making some branding changes...which they shouldn't.

I see the importance of making a new start, psychologically.  I also see the importance of operating a fiscally fit business and some of the rebranding just doesn't make sense to me.  First of all, hiring a consultancy to design the money wasn't free.  Or cheap.

The cost of repainting the planes comes in to play.  Delta will save costs by phasing this in over four years - more than enough time for the excitement of the brand's relaunch to die off.  Other airlines like American don't even paint most of the plane which helps them save in an even more critical area - fuel costs.

There's also the need to extend the brand identity across operations:  uniforms, airport signage, stationery, vehicles.  If you've ever run the numbers on an M&A deal (I have), you know that these are non-trivial expenses.  (see more concepts here)

And ironically, Delta is using more red in their color schemes.  As a company emerging from bankruptcy, I'd think they want to use more black.  Maybe they do have some customer empathy, or just a sense of humor, reflecting the emotion of their customers for so much of the recent past.  Nowhere in their bankruptcy exit statement does Delta say, "we listened to customers."

Beyond all the money spent on imagery, I'm hoping that two things change:  pricing (lower) and service (better).  Otherwise, it's just a question of when, not whether, Delta comes back to this stage of airline industry samsara.

Comments

[Josh Hallett]

I agree with you Peter. I know backruptcy is a complicated process, but if I was a creditor that was now only receiving a portion of what was owed to me I'd be rather upset that Delta was spending money on rebranding.

[Peter S. Kim]

Yeah, I agree too. It might make sense to rebrand if there was a lot of negativity associated with their bankruptcy, but from a pure consumer's perspective, my impression of the company didn't change when it went into bankruptcy.

[Graham Hill]

Peter

I also agree, but for a different reason. I have no problem with repositioning an airline when it emerges from bankruptcy. Providing it enables the airline to increase the economic value it generates as a result.

But I do have a problem with repositioning if nothing actually changes and the bad old Delta ways that led it into bankruptcy in the first place just return with a different logo. Note that I said logo not brand. A brand is what customers think it is, not what management or marketers think it is. Period. If the new Delta is no better than the old Delta, nobody will be fooled, least of all customers, and it will probably go bankrupt again.

Graham Hill
Independent CRM Consultant
Interim CRM Manager

[Pete]

And I don't see much changing despite the fancy rebranding efforts. They worked with 6 different agencies on the campaign. You can go to delta.com/change - which is a URL that's supposed to make a statement. All it does is track you and then redirect to the regular Delta site. Read more in today's New York Times.

[GrahamHill]

Peter

It seems that others do not share the sense of 'nothing has changed' at Delta.

http://www.experientia.com/blog/delta-airlines-change-the-experience-experience-change/

Graham Hill

[Pete]

Hi Graham - I don't think that post says anything substantial. First of all, the block quote is from someone at Delta's advertising agency, which should be a hint. The statement: "Through creative messaging, [Delta is] clearly stating that change is the only acceptable option to respond to customer needs." Saying you've changed is one thing - doing it is another. If you read Josh's trackback post, you'll see what I mean.

I've already taken 10 flights this year on Delta and there was no apparent difference from my experience over the past 10 years. This includes short and long flights, domestic and trans-atlantic.

However, now that a new advertising campaign has launched, I'll report back if the experience is any different next time I fly Delta.

[R Williams]

Like on many blogs, the commentary here is negative. So the fact that Delta is repainting its airplanes and spucing up airports around the world with a new, refreshed logo with a nod to the historical look of its brand is just another reason to whine. Personally, I like the new look. If you look at the font and logo history of the airline you will see that this more closely follows Delta's historical brand, in an era when it was doing a bit better than the last few years. The new look just looks classier than the most recent one and I think you will see that this design will stay for years to come.

As far as fares, I would dare anyone to do a historical comparison between airline fares and another thing of value, lets say a house. I know that my grandmother paid over $600.00 for me, a child at the time to go from Los Angeles to San Juan, Puerto Rico in the 70's and the fare today is basically the same all the while jet fuel, landing fees, insurance, etc. have skyrocketed. How do the airlines make any money at all when costs go up and up and people like yourself feel as though prices should come down is what I want to know.

[R Williams]

I found some commentary online regarding Delta's new brand. Also there is a link to the company's memo outlining the change which includes interesting points -- that the new look takes twenty percent less man-hours to paint and time offline for the aircraft, that this new look was designed to address the future composite-based skin of aircraft that will no longer have the polished sheen of the livery of American Airlines, and that it is actually lighter over-all then the previous livery, requiring less paint.

The link to the commentary:

http://www.underconsideration.com/brandnew/archives/delta_dealt_a_good_hand.php

[Pete]

Hello R,

First of all, I have little respect for lurkers that can't stand behind their comments with real name or URL.

Second, you miss the point. I'm talking about how brand changes don't matter nearly as much as running a good business. How many flights have you taken on Delta this year? I've taken 10 and can tell you that it's the same airline it's been for the past 15 years that I've been a frequent flyer.

Third, you seem to not understand the economic principles of supply and demand and how they operate in a network industry, especially one that's deregulated. If your grandmother purchased a ticket in the 70's then it was probably artificially inflated due to the anticompetitive state of the airline industry at that time. For an example of how this has played out, look at the drop in average fares in markets where Southwest and JetBlue introduce service, e.g. JFK - Buffalo.

And finally, thanks for the link to the article. It's a good step that Delta is going to reduce their O&M time related to painting in the future. It'll be better for Delta, but there's no mention of how the cost compares to American's minimal paint design.

The fact that Delta's Brand Council doesn't seem to include actual customers is disappointing. You'd think Delta could just ask people what they think, instead of asking their employees and agencies to second guess.

Believe me, I've done over 300,000 miles on Delta in my life and I'd love for the company to succeed. This rebranding isn't going to make as much impact as a truly customer-focused effort could accomplish.

[R Williams]

"First of all, I have little respect for lurkers that can't stand behind their comments with real name or URL"

"Pete"

R Williams Is my name, and as far as a URL, I have absolutely no interest in having sour, negative people anywhere near me, much less have access to me. BTW, isn't everyone on the 'net a "lurker" of sorts?

One of my best friends is a Platinum Madallion (highest FF) on Delta specifically because - he says -- people are nicer. I have flown on them recently, and my flights were nearly full, on time, and the plane looked new. Everyone was courteous and the check-in kiosk was cool. I changed my own seat to an exit row :). I think how Delta chooses to paint its airplanes is its business really. Maybe it does not WANT to look like AA. AA is known for arrogant employees who go on strike just in time for your (cancelled) trip to Grandma's for Thanksgiving (Delta has never done this). By your standard ALL airlines all around the world must have a silver-bullet paintjob and a minimal stripe or they are wasting money. AA is virtually alone in this -- why? You didn't even listen to what I passed on about the new composite material to be used for aircraft that is not the shiny aluminum that AA buffs out (wonder how much that costs??).

Go ahead, storm off to Southwest and its beautiful Desert Blue aircraft! (They are wasting money on all that paint, too.) Maybe you will hear a few "customer focused" jokes to enjoy with the peanuts. Remember get to the airport early to stand in line and fight for a decent seat. Oh, and good luck redeeming your points for that upgrade on the trip to Italy -- oh, that's right - no Business Class to worry about anyway.

If Delta made it out of bankruptcy it is because of loyal customers that like the company (like me), its employees hard work and paycuts, and decent leadership -- not the input of negative, moaning, backward thinking people.

You might add suggestions as to what you think "good customer service" is instead of just blowing hot air.

[R Williams]

"The fact that Delta's Brand Council doesn't seem to include actual customers is disappointing. You'd think Delta could just ask people what they think, instead of asking their employees and agencies to second guess." -- "Pete"

"The winning design was chosen over others by customers like you and employees..." -- www.delta.com/change

[Pete]

Ironic, as you've brought your own sour and negative hot air to this comment thread.

[Me]

Thank you, Mr. Kim,

For deciding that it is "not worth it" to rebrand and give me a new uniform because the former one I hated wearing and made me look like a hotel employee. That it should somehow effect you and make you pay more for a ticket is too bad. That you would buy a ticket "and will see" later if Delta has changed. What a crock. I work a company where people are basically nice, and take people all over the world in a good way. People on the East Coast have high expectations and are basically jerks in love with themselves sitting in judgement of others. I have found as a customer that if I am nice to the employee it goes a long way in getting what I want.

Good Luck you who thinks "rebranding" or changing is a waste of time.

[Pete]

R Williams, it sounds like you have some issues. Ironically your comments continue to be sour and negative.

Given that you are such an ardent defender of Delta, it's only ethical that you disclose your relationship to the brand. Neither I nor readers of this blog can verify if you are a Delta employee, disgruntled shareholder, or 12-year old prankster. I suggest you start by posting your real first and last name, why you're so concerned about Delta's rebranding, and use an email address that works!

If you want to learn more about ethics and proper blog behavior, visit http://www.womma.org/ethics/code/. There you'll find out about the Honesty ROI: Honesty of relationship, opinion, and identity.