Print Power

The rise of digital channels makes print-based marketing more relevant than ever, the SAS marketing chief tells Print Power

He may not have seen George Clooney’s latest movie, Up in the Air, but Per Møller Jensen, the Vice President Brand, Marketing & EuroBonus at Scandinavian Airlines (SAS), really should. In the Oscar-nominated film about a corporate hatchet man who spends more time in airplanes than in his office, airline travel has never seemed so glamorous, or romantic.

Down on the ground, reality for national airlines like SAS is a little different. The rise of the low-cost operator and an economic downturn that took even the wisest marketers by surprise, have provided challenges aplenty. Now there’s a new mood amongst airline marketers as they emerge, leaner and wiser, from that downturn. Every channel must earn its place in the marketing mix, with digital no longer the shoo-in it was two years ago. Møller Jensen’s opinion of print-based marketing epitomises this revised thinking.

A graduate of leading European business school INSEAD and a 20-year veteran of SAS, Møller Jensen points out that while SAS embraces digital marketing in all its forms – banner ads, viral and email – the airline relies heavily on print too. “The more online the world becomes, the more relevant print is,” Møller Jensen asserts. Email is proliferating as a marketing channel but Møller Jensen is wary of putting all his marketing eggs in that basket. Though SAS achieves good open rates on its email communications, gaining standout in crowded in-boxes is getting harder. “You get hundreds of emails at work,” Møller Jansen says.

Calculating the return

This is why print – both in terms of direct mail and press advertising – still claims the biggest share of the airline’s international marketing spend. The return on SAS’ TV advertising investment is less than that of printed direct marketing. “We do advertise on TV in home markets but it’s still not the main driver, which is print,” Møller Jensen points out. In fact, he says, print has been the airline’s preferred media for the past 20 years.
In that time both Scandinavian Airlines and the travel business have undergone seismic changes. Headquartered in Stockholm, SAS, the core subsidiary of SAS Group, was founded in 1951 when four airlines operating to the Scandinavian countries of Norway, Denmark and Sweden joined forces to form the Scandinavian Airlines System.

Now SAS is the largest airline in Northern Europe, transporting nearly 21.4 million passengers last year, and is the national carrier of all three Scandinavian countries. The triumvirate own 50% of the company between them, with Sweden’s Wallenberg family controlling a further 7.6%. The airline operates three hubs to over 170 destinations on four continents.??But back in the 1950s, the air travel market was a much simpler proposition. SAS has since learned to cope with a severe economic downturn and stiff competition from other international carriers such as BA and KLM – not to mention low-cost European operators such as Easyjet.

Key to survival for SAS is gaining market share at the expense of these competitors and growing the airline’s share of wallet from existing customers, both of which call for print-based marketing.

Best of both worlds

Møller Jensen is clear on the distinct functions played by press ads and direct mail, though the two “work hand in hand,” he says. Direct mail is a crucial way to connect with three million members of the SAS EuroBonus frequent flyer programme, a pioneering loyalty scheme launched in 1992 which now has 60 partners and co-branded credit cards. Press advertising, meanwhile, enables SAS to grow its market share amongst new customers.

When it comes to recruiting, retaining and rewarding business and consumer flyers, direct mail is SAS’ main channel. While paid search generates traffic to the www.flysas.com website, direct mail is vital to initiating and sustaining a dialogue with those consumers it recruits. “When executing our campaigns, we combine all channels to send the same messages to customers across platforms,” Møller Jensen says. “However, direct mail can often take the messages a step further, explaining and involving the customer more than banner ads or print ads.” The rich insight SAS has on its customer base is used in true one-to-one fashion “because we know where they are and what they like, and so can tailor the communication”. The database features both regular flyers and those who have signed up to offers, who may not yet be fully engaged with the brand.

There are “plenty of opportunities” to do segmented mailings, Møller Jensen says, but messaging must all be relevant “or it just won’t work”. You get the sense that the term ‘junk mail’ is not part of this marketer’s lexicon.
Campaigns to EuroBonus members are personalised, with segmentation based on age, sex, or passengers’ past use of the airline’s Economy Class, Economy Extra or Business Class. “We know where our customers are, what class they fly, what hotels they stay in, the car they rent, and the points they’ve earned,” Møller Jensen says proudly.

When global goes local

Though SAS is a global company, it is careful to keep its direct mail messaging local. There is a database in every country where SAS is present and rather than do a single direct mail campaign to three million people, mail campaigns vary country-by-country, and are managed in-house.

No marketing channel exists in isolation, of course, and SAS attaches much importance to being an integrated marketer. First and foremost, integration starts with the creative idea, with Møller Jensen stressing the importance of the customer getting “the same look and feel” of SAS when he or she encounters the brand in direct mail, press ads or on billboards.
Last year’s ‘SAS Globe of Fortune’ campaign by its creative agency CPB Europe is a case in point. Designed to build awareness and drive traffic to the SAS website, the agency created an online competition for people to win a trip with a random Facebook friend, the creative concept being a spinning globe with the tag line: “Let destiny pick your destination”. The spinning globe creative and tagline featured in the competition’s direct mail, print advertising, outdoor and ambient promotion.

Another good integrated example targeted business travelers in 2007 using a variety of channels such as direct mail, email, banners with click-throughs, telemarketing and press ads – all used to drive prospects to a dedicated microsite. The aim was to ask recipients to complete a survey and highlight their areas of interest, which then produced a list of names for a national sales team to follow up. The campaign targeted around 25,000 individuals and achieved a seven per cent response rate, with about 2,000 surveys completed.

For SAS, direct mail and digital advertising in particular have been proved to complement one another. This month the airline is running a campaign to business travelers which will highlight the airline’s time efficiency – in 2009 SAS was ranked as the most punctual airline in Europe – with online banners and direct mail generating traffic to flysas.com.

More power to the SAS database

Mail also works well in supporting the airline’s print ads aimed at brand building and customer acquisition. Though Møller Jensen cites the size of the EuroBonus scheme with pride, he is not complacent and knows it must continue to grow. “If you only went out to our three million frequent flyer members with direct mail to encourage them to go to the website and book, we would never be able to enlarge our database,” he says.

When SAS runs a campaign announcing a fares sale, its frequent flyers get advance notice in the mail of price discounts. After that, it’s effectively a marketing road-block, with SAS’ low fares messages dominating national and local newspapers, outdoor, email and banners on websites. “Everyone in Scandinavia knows that SAS has a sale on during those 10 days,” Møller Jensen says with a smile.

Press ads are particularly cost-effective as a broader medium that lets SAS approach an audience it doesn’t yet have. Media are carefully targeted, with SAS using papers such as the London Times and Boersen, Denmark’s equivalent of the Financial Times, to trumpet business features such as the SAS Fast Track security service.

The current deflation in newspaper media costs adds to these efficiencies. “We’re getting more bang for our bucks [right now], for sure,” Møller Jensen says cheerfully. “We’ve been able to create more noise for the same amount of money.”

Timing is everything

SAS has three main sales periods for consumer and business travellers per year, with campaign timings guided by the company’s sophisticated sales modelling. Such models take market and SAS data into account, with an overlay of the wider societal picture. For Møller Jensen, the purpose of sales modelling is simple: “We look at when people are more inclined to buy,” he explains.

The timing of leisure communications differs completely from business campaigns, which begin in earnest in August when business people return from holidays and start planning their autumn work trips. January and February are the favoured months for holiday bookings, and SAS campaigns will not just push the airline’s features and convenience, but also the desirability of Scandinavian countries as a holiday destination.

These are testing times for airlines such as SAS, as it consolidates its well-publicised financial recovery plan, Core SAS. In a review of its print advertising conducted last year, SAS identified the technological developments that will affect its use of print, including ticketless travelling and biometric identification, where a passenger’s fingerprints are matched to their respective checked baggage for security purposes. But for airline marketers like Per Møller Jensen, cut-throat competition means there is a huge imperative on communicating with consumers anytime, any place and through every medium. It’s no surprise that for SAS, the reach and cost effectiveness of print are the core reasons why it still figures highly in SAS’ marketing hierarchy.