Jodi Clock of the Clock Life Story Funeral Home, responds to my thoughts in the post, Discount Selling and Full-Service Don’t Mix, by saying:

In my opinion I do agree that AA doesn’t know what it wants to be, however I do agree that there is room in the airlines and even with AA for a discount brand or version.Major hotel chains have proven that model Marriott, Courtyard and Fairfield for example. It seems AA’s debacle isn’t brand confusion it’s a cash issue combined with consumer panic. AA are desperately re-acting to gas prices, lack of customers and their bottom line. Sound familiar? How many funeral homes do we see panic and re-act to the competitor,rather than stay on course?


Photo courtesy of Flickr User
smenzel

Jodi has a point:  many companies have discount portions of their brand.  However, most have found it necessary to separate their discounted brand.

TED is the discount version of United.  Instead of separate compartments, they have separate fleets.

Courtyard by Marriott is a lower priced version of the famed hotel chain.  But Courtyard’s rooms aren’t housed in Marriott hotels; they’re in separate facilities.

Anderson-McQueen operates their lower-priced Cremation Tribute Center separate from their funeral homes. 

Except at super-mega-dealer properties, General Motors separates their Cadillac and Chevrolet dealerships to reduce confusion between their luxury and discount brands.

And almost every company that offers full-price services and discount versions also keeps their marketing efforts separate.

Ads touting the luxury of the Waldorf Astoria Hotel will neglect to mention the great prices at Hampton Inn, even though both are part of the Hilton family of brands.

When typing your needs into the carfinder at the Lexus website, you will not find a single Toyota or Scion in the search results, even though all three belong to the same megacorporation.

If American Airlines wants to continue appealing to full-price and discount buyers, they’ll need to separate their disparate business models.

It seems to me that the only reason to charge discount fliers more to check a bag is to further alienate them so they will stop buying your product.

Why not simply stop selling to them?

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