By Steve Lapa
Lapcom Communications Corp
President

Almost everything I know about pricing strategy I learned from domestic airlines. Guess what? Airlines are at it again and I hope you are watching and learning.

As a young national sales manager, then general manager, based in South Florida in the 80s, I became a student of some of the best competitive marketing strategies ever created. Anyone would be hard pressed to remember all the domestic airline brands that serviced South Florida back then. Off the top of my head, here are the nine I remember: Eastern, Delta, Continental, American, United, US Air, Pan Am, TWA, and for a short time, Florida Airlines. Depending on the routes and time of year, the competition was crazy. Once the fourth quarter holiday season began in these pre-computerized days, last-minute changes kept me at my desk way too long, showing up late for several holiday dinners. Pricing, heavy ups, and copy changes came down with minimal lead time and a mandate of no make goods. Computers were first working their way into radio stations. Inkjet printers were in development and mobile phones were still in the lab at Motorola.

Armed with a desktop calculator, pencil, and yellow pad, I worked feverishly to keep up with the airline marketing tsunami that hit the Miami market leading up to Christmas travel. Our traffic department was the only part of our radio station that worked with computers. Nevertheless, stress and anxiety ruled until all orders were correctly inputted and confirmed. Once the smoke cleared, I decided to learn from our clients, the original pricing disruptors: the airlines of the early 80s.

After visiting with marketing directors, I learned how market demand and inventory were calculated and balanced to determine pricing. Later, I studied how Southwest successfully pre-sold into markets they were about to service. The successful airlines taught me how to improve the execution of “grid card rate management.” How to fine-tune and balance anticipated sell-out levels and integrate seasonality. Later, the art of successful pre-selling became an important part of our mission.

Fast-forward to today’s airline marketing and pricing. It’s all about the upsell. Consider all the options you have once you book that economy ticket. From early boarding, extra legroom, baggage fees, refundable vs. non-refundable tickets, travel insurance, to double the points, etc.

Airline income and profits are still on the post-pandemic upswing. Domestic travelers are out in force, many travelers comfortably participating in the upsell. The strategy is working.

Few if any radio-audio sellers are skilled in upselling. Most managers are not skilled in the upsell strategy and rarely have the time to learn. The concept may feel a little awkward at first, but once you understand how to work with the spectrum of assets your platforms can offer, the upsell strategy can help increase your sales as you help your clients!

Steve Lapa is the president of Lapcom Communications Corp. based in Palm Beach Gardens, FL. Lapcom is a media sales, marketing, and development consultancy. Contact Steve Lapa via email at: Steve@Lapcomventures.com.