By: AirTravellerPH Staff
A recent report from the Philippines's Civil Aeronautics Board (CAB) showed that as of the current year (2019), domestic scheduled passenger traffic reached 15,160,999. Out of that, 6,601,280 were transported by Cebu Pacific and 968,576 were transported by CebGo. This means 7,569,856 passengers were transported by both Cebu Pacific and CebGo combined, accounting to 50% of the total domestic passenger traffic!
So you may be wondering how Cebu Pacific captured 50% of the domestic travellers? Aside from its fleet, network, and capacity, they had one very powerful asset that contributed to their success, and that is marketing. If not of how Cebu Pacific marketed their low fares and how they created a powerful branding, they would not have captured half of the total share.
Want proof of how powerful their branding is?
Many people have written "hate" posts on social media versus Cebu Pacific, or have even written hate blogs, but guess what, wait for a "Piso fare" announcement and see how the same people will end up booking. Cebu Pacific may not be the perfect airline, but their know their market very very well.
Cebu Pacific became the "Colgate" and "Xerox" of affordable plane tickets in the Philippines. "Hanap ka ng murang fare lang, tignan mo magkano ang Cebu Pacific" has been a common line among Filipino travellers. Indeed, the airline have built a very powerful branding for affordable air fares. There are even times that Cebu Pacific air fare can be more expensive than Philippine Airlines given the value one may get but if you will look at the wider picture, the general perspective of everyone is "Cebu Pacific has the cheapest airfare". Well, Philippines AirAsia is now catching up.
A huge factor that contributed to the airlines's success was their aggressive marketing and branding. First of all, they were the very first airline in the country to be market its low and very affordable fares. During the time Cebu Pacific started to receive their Airbus aircraft, all the more they pushed a powerful branding as a low-cost no-frills airline, which captured the Filipino domestic travellers.
Cebu Pacific concentrated on their branding as a low-cost no-frills airline, they did not go far from there. All-economy class layout and you pay for any additional frills like food or a juice. They also pioneered an option where you could enjoy even lower fares when you have no check-in baggage.
To give that "fun flight" image, the airline also engaged on a marketing tactic that uses "puns" to capture the Filipino audience. Filipinos love puns and punch-lines. "Anong tawag mo sa..." and "knock-knock" jokes has been a part of Filipino culture and Cebu Pacific was able to capitalize on such puns for their posters and marketing materials.
Synonymous to "low-fares" were the words "fun" and "casual", which were all carried out in the airline's marketing collaterals.
The signature "Piso-fares" was a game-changer, and this was where Cebu Pacific won the domestic market. From then on, the airline was able to capture up to the C and D market in the Philippines. By consistently having different "year-round low-fares" promos, Cebu Pacific eventually became the primary choice of Filipinos for domestic flights. They simply knew what the market wanted and they delivered exactly just that.
Cebu Pacific also took to social media when it was still not a popular form of marketing during that time. They were basically the first airline in the country to heavily use social media in marketing. Today, they have 5M fans or likers, the highest among all the local airlines.
As the airline's load factor and demand for more low-fare flights grew, their network grew at the same time which allowed them to open more hubs in the country. The airline also has hubs in Clark, Cebu, Kalibo, and before in Iloilo and Davao. They were able to open more inter-island routes using ATR turboprops and of course, A320 jets, eventually, increasing its domestic market share further.
Cebu Pacific recently invested on higher capacity aircraft like the Airbus A321NEO and the A330-900NEO in order for them to carry more passengers. For this, it is the job of their marketing team to get more passengers to take Cebu Pacific flights.
So how has Cebu Pacific's marketing contributed a lot to gaining half of the domestic market share? Answer is simple, and that is BRANDING! They branded themselves solidly as an airline that will bring you from point A to B safely at the lowest cost possible without any frills. For Filipino domestic travellers, most care about arriving to their destinations safely, and the money they save by riding a low cost airline can be used for like more pasalubongs or extra pocket money. Indeed, the Philippine domestic traveller market are quite price sensitive. They do not care much about comfort, all they do care about is arriving safe and saving money. At the end, a low-cost carrier still serves its purpose to fly passengers safely, and that was the whole branding of Cebu Pacific.
Cebu Pacific concentrated on one lucrative market, the travellers who want cheaper and no frills flight. Apparently, more than half of the domestic air passengers air price sensitive and would rather travel at lower rates, for as long as they can get to their destinations safely. As inflation continues to increase, we expect more Filipino domestic travellers to be price sensitive.
Today, Philippines AirAsia is using the very same tactic, and their target is to overtake PAL Express for the domestic market share. Presently, PAL Express accounts for 3,772,929 passengers flown and 2,610,907 were flown by Philippines AirAsia (PAA). The increase in PAA's numbers was also brought by a more aggressive marketing and branding, where they want to be recognized as "the airline with the lowest air fares" in the Philippines. At many times also, PAL Express fares have been lower than Cebu Pacific and have had more value than PAA but then again, everything will still boil down to branding.
Presently, PAL Express is strongly associated as Philippine Airlines, as a legacy carrier, hence, higher fares. Notice that during PAL's "Ultimate Seat Sale", their booking system is literally flooded with those who want to take advantage of the low fares of a legacy carrier. This speaks a lot of the potential branding of PAL Express should the PAL group enable a dual-branding strategy.
The LCCs will continue to dominate the Philippine domestic traveller market, and will continue to grow. As this happens, Cebu Pacific will continue to enjoy the fruits of their powerful branding, but definitely not a time for them to rest on their laurels as PAA is presently employing a similar branding tactic.
Branding indeed plays a huge role in an airline's success.