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Author Topic: Marketing  (Read 1684 times)

Offline vidiv007

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Marketing
« on: May 28, 2018, 09:30:16 AM »
I was looking around on the forum for advice on best route specific marketing tactics (TV or radio etc.,) and saw some posts from ~2010-11, which argue strongly against route marketing, that its a waste of money and provides a tiny time increase on what simply flying a route to RI of 100 would give. Is this still true? Is spending on route marketing once you are established (thus paying more per campaign) pointless?

Thanks

Offline gazzz0x2z

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Re: Marketing
« Reply #1 on: May 28, 2018, 09:36:14 AM »
I was looking around on the forum for advice on best route specific marketing tactics (TV or radio etc.,) and saw some posts from ~2010-11, which argue strongly against route marketing, that its a waste of money and provides a tiny time increase on what simply flying a route to RI of 100 would give. Is this still true? Is spending on route marketing once you are established (thus paying more per campaign) pointless?

Thanks

It's true most of the time.

Still, there are times when it's useful. Early in the game, it's very cheap, and helps growing load factors. LAter in the game, for intercontinental flights, it may still be worth it. IT's complex maths, but le'ts say that if you open a  8000NM flights with 3 daily rotations at once, you'd better have it making money as quick as possible, and the 60/80M$ of marketing campaign may be worth it. Be sure to do the maths before.

That's not common, though. Most of the time, RoI is not there.

Offline vidiv007

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Re: Marketing
« Reply #2 on: May 28, 2018, 09:41:14 AM »
Thanks, and also thanks for your guides, have helped me a lot through the times.

Offline Tha_Ape

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Re: Marketing
« Reply #3 on: May 28, 2018, 09:41:57 AM »
Agreed with Gazzz.
I keep doing it, because I can afford it and because I like to see the results of my new routes fast, but yes, it's not really worth it past a certain point.

But I like to add another exception to the ULH non-daily flight: cargo. Cargo is very RI sensitive and the demand will start to shift from potential to actual mostly past RI=90, so if the potential is very high but the actual very low, it's worth investing.

Offline gazzz0x2z

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Re: Marketing
« Reply #4 on: May 28, 2018, 09:57:16 AM »
(.../...)But I like to add another exception to the ULH non-daily flight: cargo. Cargo is very RI sensitive and the demand will start to shift from potential to actual mostly past RI=90, so if the potential is very high but the actual very low, it's worth investing.

Probably true. I lack experience in the cargo area, but most of my alliance players who tried it noticed a massive improvement between 80 RI and 100RI. Which makes route marketing far more brutally interesting that for pax, where RI effect is far more linear.

Online Cardinal

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Re: Marketing
« Reply #5 on: May 28, 2018, 04:59:12 PM »
Marketing in any form also boosts your CI. Whether it's general company marketing or route marketing, spending more money = higher CI (unless you're already at 100, obviously).

Early in the game when my CI is still down in the 30s but I'm spending enough money for a 50 CI (eventually), I've noticed that if I spend some money on route marketing for an important new route not only does the RI of that route grow faster, my CI grows faster too. So my route reaches profitability quicker and I reach the CI plateau sooner. Conversely, if I'm strapped for cash during the early growth years sometimes I'll shift spending from general marketing to route marketing to keep the same level of CI growth (or maintenance) while getting new/competitive routes to profitable load factors more quickly.

Offline yearofthecactus

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Re: Marketing
« Reply #6 on: May 28, 2018, 06:15:01 PM »
Marketing in any form also boosts your CI. Whether it's general company marketing or route marketing, spending more money = higher CI (unless you're already at 100, obviously).

Early in the game when my CI is still down in the 30s but I'm spending enough money for a 50 CI (eventually), I've noticed that if I spend some money on route marketing for an important new route not only does the RI of that route grow faster, my CI grows faster too. So my route reaches profitability quicker and I reach the CI plateau sooner. Conversely, if I'm strapped for cash during the early growth years sometimes I'll shift spending from general marketing to route marketing to keep the same level of CI growth (or maintenance) while getting new/competitive routes to profitable load factors more quickly.

Absolutely true, and a very overlooked thing that people ignore.

Offline stealy

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Re: Marketing
« Reply #7 on: May 29, 2018, 12:29:55 AM »
I have mixed opinions about route marketing. I used to invest in route specific marketing for every new route when I was playing in BW1 and BW2. I was swimming in cash, so I didn't pay attention and didn't care to do the math to see if the millions of dollars I was spending was worth it.

I started in GW2 last month and tried to do the same thing - investing in route specific marketing for every new route. I was losing money, but I wasn't suprised as it's not uncommon to lose money in the early stage. After about six months of game time (not real life time), most of those routes had RI of 100. Perfect, but I was still losing money every week... I was confused because I had good LF and RI of 100. I decided to check my income statement to see why I was not earning any profit. It turned out... all of my profit was being used on marketing. My balance was in the negatives and I almost went bankrupt. So I cancelled ALL of my marketing campaigns except for a single general campaign to boost my CI. I immediately started making a profit.

After that incident, I have never bought any route specific marketing and I am just fine. I even tested the difference between having route specific marketing vs not having it for two routes with RI of 0 and the difference was marginal. It definitely helps, but I am not sure if it's worth the money unless of course, you have too much money to blow.

I wouldn't waste the money if I am running on a small profit (like most new airlines) as most, if not all, of your profit will be gone. It's especially a waste if you are marketing for a route operated by an aircraft with less than 80-100 seats in my opinion.

Long story short... if you have the extra $$, why not? If you are running on a small profit, don't bother. Just invest in general marketing to boost your CI and increase your spending as you get bigger.

« Last Edit: May 29, 2018, 12:32:07 AM by stealy »

Offline Luperco

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Re: Marketing
« Reply #8 on: May 29, 2018, 08:34:22 AM »
In a past GW I've made some tests.

I took some similar medium haul routes (around 1000nm) and put a route campaign on half of them for 6 months.

The route image on those with campaign reach 100 one game month before those without. But the profit on the routes was similar for all. Those with the campaign starts being profitable maybe one week before those without. Nothing that is near to the money spent for the campaign.

I never done a similar test with long haul so maybe worth for that kind of routes.

Long story short... if you have the extra $$, why not? If you are running on a small profit, don't bother. Just invest in general marketing to boost your CI and increase your spending as you get bigger.

The fact that you have money to throw, doesn't necessary mean that you have to throw  :)
Saluti
Emanuele


Online JumboShrimp

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Re: Marketing
« Reply #9 on: May 29, 2018, 10:50:49 AM »
I have mixed opinions about route marketing. I used to invest in route specific marketing for every new route when I was playing in BW1 and BW2. I was swimming in cash, so I didn't pay attention and didn't care to do the math to see if the millions of dollars I was spending was worth it.

I started in GW2 last month and tried to do the same thing - investing in route specific marketing for every new route. I was losing money, but I wasn't suprised as it's not uncommon to lose money in the early stage. After about six months of game time (not real life time), most of those routes had RI of 100. Perfect, but I was still losing money every week... I was confused because I had good LF and RI of 100. I decided to check my income statement to see why I was not earning any profit. It turned out... all of my profit was being used on marketing. My balance was in the negatives and I almost went bankrupt. So I cancelled ALL of my marketing campaigns except for a single general campaign to boost my CI. I immediately started making a profit.

After that incident, I have never bought any route specific marketing and I am just fine. I even tested the difference between having route specific marketing vs not having it for two routes with RI of 0 and the difference was marginal. It definitely helps, but I am not sure if it's worth the money unless of course, you have too much money to blow.

I wouldn't waste the money if I am running on a small profit (like most new airlines) as most, if not all, of your profit will be gone. It's especially a waste if you are marketing for a route operated by an aircraft with less than 80-100 seats in my opinion.

Long story short... if you have the extra $$, why not? If you are running on a small profit, don't bother. Just invest in general marketing to boost your CI and increase your spending as you get bigger.

Route marketing is good in some situations, not really necessary in others.
- SH pax: bad
- LH pax: maybe
- cargo: often useful

Offline knobbygb

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Re: Marketing
« Reply #10 on: June 16, 2018, 09:23:26 AM »
Absolutely true, and a very overlooked thing that people ignore.

I agree. If I've had a sudden CI drop (for example when intentionally rationalising staff levels), I'll often add some RI marketing on my next few LH routes to help the CI along. The only other time I use route marketing is in a price-war. If my competitor is nearly bankrupt anyway, I'll often add flights on some of his most marginal LH routes first. With these, it's important to get the RI up as quickly as possible to allow my flights to be profitable with low LF and/or reduced prices.

Offline Tijnster

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Re: Marketing
« Reply #11 on: June 26, 2019, 07:32:17 AM »
Why do I have top spend >20% of revenue on marketing? It looks like the budget , as a % of revenue, needed to maintain a CI level is bigger when the CI is >50/60? Is that true? What do you recommend as a % of revenue? At 15% e.g. my CI drops.

Offline groundbum2

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Re: Marketing
« Reply #12 on: June 26, 2019, 07:54:59 AM »
CI spending is definitely not linear. Ie, what a person would spend to go from 0CI to 10CI is not the same as you'd spend to go from 90 to 100CI. It also seems to go in "bands". Often I'm at 90CI and add a new expensive campaign and still say at 90CI! It seems to need a huge increase to get to the next level, and adding modest amounts is not enough to get over the bar.

There isn't a definite % to spend, it's better to find a CI to aim for. CI is over-rated, it's only necessary to get close to your main competitors, and even then it will only mainly impact FC traffic, so if there isn't much it's not worth spending to get a high CI. It's a conceit of billion dollar airlines to get a CI 100.

CI does help with credit rating, you won't get the higher rating unless you're CI is 50 (B) or 90 (AAA).

Simon

Online tungstennedge

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Re: Marketing
« Reply #13 on: June 26, 2019, 10:11:06 AM »
I spend 1.5% of my expenses for marketing to achieve 100CI, having 500 planes. The marketing cost doesn't seems to scale up much with the size of your company, at least not linearly so as you get bigger I think a smaller amount would be spent on marketing as a fraction of your revenue.

Offline groundbum2

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Re: Marketing
« Reply #14 on: June 26, 2019, 10:14:46 AM »
CI spending is related to number of destinations, not fleet size is my recollection.

So if you start a permanent campaign for 50K/week and you're flying to 10 destination, then in a year when you're up to 30 destinations you'll see the marketing campaign has increased from 50K to say 150K.

Simon

Offline knobbygb

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Re: Marketing
« Reply #15 on: June 26, 2019, 10:28:14 AM »
I spend 1.5% of my expenses for marketing to achieve 100CI, having 500 planes. The marketing cost doesn't seems to scale up much with the size of your company, at least not linearly so as you get bigger I think a smaller amount would be spent on marketing as a fraction of your revenue.
It depends a mostly on the number of destinations, thus flying a lot of short-haul routes means more expensive marketing.

I have two games going at the moment. One has (approx.) 100 F.27 flying only short-haul and averaging 4 routes per aircraft per day.  In this game I'm still spending approx. 10% of my revenue to get a CI of 60.  In the other game I'm flying (just over) 100 Connies, nearly all ultra-long-haul, averaging 0.7 routes per aircraft per day and I've reached CI 60% with a marketing spend of 4.5% of revenue. Later in the game, with larger, more efficient aircraft I'm expecting that to drop to about 1% and reach CI 100 with <2.5% of revenue spent on marketing.  In short, the NUMBER of unique destinations count. If you open a route to an existing destination from another base, there is no increase in marketing cost.

Quote from: Cardinal
Early in the game when my CI is still down in the 30s but I'm spending enough money for a 50 CI (eventually), I've noticed that if I spend some money on route marketing for an important new route not only does the RI of that route grow faster, my CI grows faster too.

Agreed. Actually, in my ULH-connie game, I dropped permanent marketing completely and ONLY had route-specific campaigns. I found that as long as I spent the same amount of money, the CI rose just as quickly (I think) but had the added advantage of faster RI boost.  You have to be VERY careful with this strategy though - it's easy to go to bed and wake up realising a load of campaigns have finished and your CI has dropped for 60 to 40 overnight!

Offline groundbum2

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Re: Marketing
« Reply #16 on: June 26, 2019, 11:56:16 AM »


Agreed. Actually, in my ULH-connie game, I dropped permanent marketing completely and ONLY had route-specific campaigns. I found that as long as I spent the same amount of money, the CI rose just as quickly (I think) but had the added advantage of faster RI boost.  You have to be VERY careful with this strategy though - it's easy to go to bed and wake up realising a load of campaigns have finished and your CI has dropped for 60 to 40 overnight!

ooooh. This could be how Elite (cough) always manage to get their CI up super high super quick, and also get good LFs on route. The top secret secret could be out the bag. Don't worry Knobby, I won't tell them you live on Paros when they want to send the black helicopters over your hou... oh damn  :D

S

Offline gazzz0x2z

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Re: Marketing
« Reply #17 on: June 27, 2019, 10:01:45 AM »
It's also directly dependant on where your HQ is based. I'm paying trinkets to stay at 90CI in south Vietnam. With just 21 IL18s & 14 viscounts flying. Try to do the same in a rich country like the USA, you'll quickly die under the marketing costs(even before staff costs kill you, those babies need an insane amount of pilots).

And yes, the RI influence on CI is something I've applied since years. Since before I joined Elite, in fact. I can't remember if someone in Worldlink gave me the hint, or if I found it directly on the forum. It works even better in poor countries(because you can keep the trick longer, route marketing does not get prohibitive that fast), but I was succesful with it in CDG, MPL, DTW as well as ALG and SGN.

Offline Tijnster

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Re: Marketing
« Reply #18 on: June 28, 2019, 08:17:19 PM »
Thank you all for your replies. I get it now.

Offline DanDan

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Re: Marketing
« Reply #19 on: July 05, 2019, 10:22:11 AM »
Shortcomings of Marketing and CI in AWS

My current GW2 airline had three campaigns for more than 10 years. It helped me reach 70 CI quickly. After that I expanded my services - marketing costs for the three campaigns went up of course. CI remained unchanged. Combined, these three campaigns have a value of, 1971, 1.3M per week.

Now I added a minimal fourth campaign, 60k base city & newspapers only. But: CI is climbing again, already at 86.12, currently climbing with .16 per week.

That just doesnt make sense. In my opinion, the whole CI-system should be either
-) one number, where one defines the money to invest or
-) a really complex system, that takes into account things like seating quality, IFE, airport lounges, ...

the way it is now is just complexity without purpose and certainly doesnt have the feel of a realistic experience.

 

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