Saturday, January 18, 2014

The power of Tony Fernandes's brand

On a holiday, I was watching CNBC Europe yesterday and what CNBC had was a 15 minutes interview with Tony Fernandes. They were not just talking about Airasia and Airasia X as well as the challenges that his airlines are facing but also QPR.

What strikes me about the interview with Tony was that, unlike some other interviews, CNBC Europe was pre-empting viewers (for some 2 hours) that Tony was to be part of the show for the day which made me stayed on to watch. Like I said, it ended up as only a 15 minutes interview - maybe less even.

Now - let's think it over - Airasia is not even a part of Europe nowadays. It does not fly to Europe anymore. He is part owner of QPR and QPR is not even a Premier League team now. But what makes CNBC pre-empting its viewers for some 2 hours not letting us know at what time the interview was supposed to happen? Tony Fernandes is a big brand himself even in Europe.

One may or may not support Airasia - due to several things that it made to its consumers - like charging for almost anything, but as a Malaysian ain't we proud that we have someone like him?

How do we leverage on his brand? How does Malaysia support him rather fight him? We embraced lesser stars aren't we? - Jimmy Choo (whom does not own the Jimmy Choo brand anymore) and Michelle Yeoh and her husband (not a Malaysian), even.

I have been on local flights every week nowadays - and the thing that strikes me is that airfares price competition has gone to quite ridiculous stage. I like it, as it allows me to buy cheap flight tickets, but I also know that it probably will not last - got to enjoy it while I can.

While I know Airasia is one of the brands controlled by Malaysians and made it big by Malaysians is facing lots of challenges from the likes of Malindo and MAS - we know that the current situation will not last. We should not give in to Tony Fernandez and his group with a silver platter. He is a furious fighter. What Airasia has is scale, speed and sourcing. If Malaysia does not turn out well for Airasia, it has the ability to move beyond Malaysia. Not MAS.

But we are using taxpayers money (for MAS especially) to fight on something which you know MAS will lose without the support of government's money. Malindo is facing the same thing. I do not know who owns the 51% of Malindo (except that it is NADI - and who is behind NADI?) and I like the price competition but not the way it is fought.

We are just fighting a war which all will lose. Consumers win for now - but somehow or rather it is very short term. What we need is a major revamp in terms of cost structure for MAS, not giving extra privilege to Malindo whom is allowed landing in Subang but not Airasia. Not the way the war is fought currently.

You can watch his interview with CNBC Europe here.


panaceaasia said...

The Tony Fernandes and AirAsia brands are not as powerful as suggested. Powerful brands command brand loyalty and provide the products pricing power.

AirAsia is competing on price. The brand lacks the pulling power. If a can of Coke cost $2 and Brand X $1.50, which product will you buy? A Mercedes will not be less desirable if Toyota offers me a 20% discount off a Camry.

felicity said...

HI Panaceaasia

The Airasia brand is about low price, low costs.

Walmart and Tesco are still powerful brands. So is Amazon. They provide discounted items.

Tony Fernandes himself is a different brand. It is about execution and based on a separate business models from what others already have.

eKimkee said...

Thanks for sharing, Felicity.

Let's see who is the winner bout 2 to 3 years from now.

Betronist said...

I agree that Tony has marketed himself in a brilliant way, or I should say, a celebrity way, in the business arena. When it comes to investment, many of his die-hard fans would not hesitate to put their money into whatever shit he builds. Truly entrepreneurial but I feel a bit over-hyped. Still I'm proud of him as a Malaysian.

AirAsia wise, I agree with panaceaasia that its brand is not as powerful as suggested. The brand is about cheap, and that's it, nothing more. The group did not even think about providing a SLIGHTLY better service to its customers, even though raising the quality of services actually doesn't incur any monetary cost. The brand of AirAsia is about -- cheap, everyone can fly, get what you pay, narrow leg room, delaying flights, stewardesses who don't smile, unresponsive customer service, and conning free-fare promo. I am sure many people could add more into the list, I guess mostly negative one.

I'm glad that Malindo came in to compete, not only for price, but also for the quality of services. I flew with Malindo before, the pre-flight and on-flight experience were awesome! I don't mind paying a bit more than AirAsia for it, but we are lucky to pay lower or at par with AirAsia (for the time being). I hope people would stop saying that cheap is the reason of getting low quality stuffs.