Repositioning British Midland

In 1998, the executive team of British Midland realized that they needed to plot a new course for the airline in a rapidly changing world. There was a growing threat from the burgeoning low-cost sector and, at the same time, the company was appearing increasingly isolated outside the global airline alliances such as Star and Oneworld. The carrier was a strictly short-haul, regional airline within Europe.

The company's response to this set of circumstances has been a bold one. It joined the powerful Star alliance- led by Lufthansa and United Airlines- and set about transforming itself into a global airline. It expanded its fleet, commenced a long-haul service to the USA and developed a new brand image. The company felt that the name British Midland was too parochial for a company repositioning itself as a global airline and spent £15 million on a corporate rebranding initiative. Several alternative new names were considered, including British Blue and Bluebird, but it was felt that these were too radical and there was a desire to retain some elements of the British Midland brand. Therefore, it changed its name to bmi british midland (with the lettering all in lower case) as it was felt that this brand combined the best of the company's heritage-British, service and innovation-but that it was also geared to the expectations and aspirations of its new customers.

In short, the company tried to evolve the brand, rather than re-invent it. Consumer research identified three core elements in the airline industry: charm, style and speed, bmi british midland is trying to bring back the charm and to nurture a better experience, while the style comes with the unique design language.

Summary

Market segmentation, targeting and market positioning are among the key strategic decisions a marketing manager has to make. Market segmentation is the foundation on which a positioning strategy is developed. A variety of criteria are available that can be used to segment consumer and industrial markets, ranging from behavioural, psychographic and profile variables in the case of the former to dimensions like size, industry and buying organization style in the case of the latter. In many cases, marketers will combine variables to arrive at the desired segmentation approach. They may then choose from four targeting strategies: undifferentiated marketing, differentiated marketing, focused marketing and customized marketing. Recent developments in production and information technologies have significantly increased the possibilities for customized marketing in con­sumer markets. Positioning entails the choice of target market and differential advantage. The keys to successful positioning are clarity, consistency, credibility and competitiveness. When circumstances dictate a change in market position, marketers have a choice of four options: image, product, intangible repositioning and tangible repositioning. Repositioning may be necessary as market opportunities and threats develop. It is the process by which companies attune their product offerings to the changing requirements of customers and the competitive advances occurring in the marketplace.