The startup airline, following a deal with American Airlines, will initiate 21 daily flights to seven West Coast cities next month. The new routes will shift Reno Air's focus away from leisure travelers and place the company in the fiercely competitive business travel market - Reno estimates 60% to 85% of the customers it will serve out of San Jose will be business travelers.
The price tag on the new strategy has not yet been determined. Reno Air, which first took to the skies last July, spent just $1.2 million on advertising in 1992. GMO will be racing to launch new work by mid-month to support Reno's new corridor start date of July 15.
'The upstart personality will be a key ingredient in the advertising, but we will not be taking on anyone directly,' said Gail Piper, vp and management supervisor for GMO. 'We're not looking to pick any fights.'
In March, the airline initiated service between Reno and Minneapolis with a spirited David and Goliath print campaign designed to tout its price advantage over its larger competitor Northwest Airlines. But Northwest quickly matched its discount prices. Faced with a shortfall in bookings and without the financial wherewithal to withstand a protracted price war, Reno retreated. 'The market did not respond as our studies indicated,' said John Campbell, vp of marketing and sales for Reno Air. 'We were operating at a loss and we're not going to operate on an unprofitable fare structure.'
Copyright Adweek L.P. (1993)