Today I present this case in the course that I have been doing every Wednesday, HCM Academy with the lectures Matteo Rinaldi and Luca Bertocci. The topic was “Marketing Communication Mistakes” and despite the nervousness, I could give my contribution to the class doing a presentation of this case, with the very kind support of Francesco Antonio de Caprariis.
AMERICAN AIRLINES – FREE FIRST-CLASS TRAVEL
Would you will like to travel in the first class forever?
So, in 1981, American Airlines introduced the AAirpass, offering unlimited first-class flights for a flat rate of $250,000 USD. At the time, they were strapped for cash, and they hoped to raise millions during a time of record-high interest rates.
But they didn’t expect the people who’ve purchased would use it without limits. They used these passes have more than since made up for the investment. Some of them, AAirpass holders, were taking 1,000’s of free flights every year, that means costing the company millions in lost sales.
Several factors had been contributed to the disaster of the campaign, as such lack of market research in its public and the external environment, they didn’t analyze and tried to identify the external factors that are favourable and unfavourable to follow up with that campaign, they didn’t limit the number of flights, thus allowing the person to fly numerous times. Maybe the marketing campaign may have been well developed, but without analysis and integration with the other sectors, it failed.
A long-term goal was lacking, this action would be essential to not lose the money they earned quickly
Remember, If you’re offering an incentive to your customers, set reasonable boundaries so both sides can benefit, but make sure you’re prepared to deliver on your promises.