Airline brand destruction - Qantas

Implications: When you read the first three words above,  you would normally think a US carrier world you not? Apparently the airline service contagion has now reached Australia's shores. What a pity.

Analysis: The author makes an excellent point about Qantas. The story sounds like it comes directly from the US; change the name Qantas to say United and just keep the Virgin name. Of course Qantas has yet to start with baggage fees but that may be coming.

Isn't it interesting that Qantas takes delivery of a spanking new A380 and within a week a story like this emerges? What is going on inside the airline? Yes service costs a bit more, but people will pay for that. Moreover, Qantas cannot ignore its domestic feed. Pan Am and TWA did that - and where are they now?

The airline within an airline concept has been shown to be an abject failure in the US - McKinsey tried it a few times and it does not work. Brand confusion settles in quickly and this never helps create new business. Think about Song and Ted.

Now its true that this story is but one voice. But Robert Stockdill is the co-founder and group editor of Aviationrecord.com. This man knows a little about the business. His comments cannot be dismissed out of hand.

Of course Qantas won't listen. The older the airline, the less functional its hearing. But others will listen to Mr. Stockdill's advice to try other less "premium" brands. Even though Virgin America is not yet a raging financial success, fly them once to SFO and you won't fly United again.

Airline brand management therefore remains a work in progress where new entrants can make headway - charge the same or a bit less, but offer happy employees and new planes, and you will acquire customers. Then just hang on and don't burn all your cash too fast.