ONE-MINUTE BRIEFS: Airline cuts begin to hurt

Suppliers and agencies are bracing themselves for swingeing cuts in

airline direct marketing budgets, as the effects of the terrorist

attacks in the US on 11 September begin to bite.



The chief casualties of the airline industry crisis to date are agencies

and suppliers to cash-strapped British Airways (BA), which is slashing

its advertising and direct marketing spend.



BA is particularly exposed to the collapse in demand for North American

business travel and is culling its cost base as a result.



DM agencies Carlson and Claydon Heeley Jones Mason have both been

dropped from BA's roster. A BA spokesperson said that this was due to

"commercial pressures and nothing to do with their performance".



TMW has been retained as BA's lead agency, with support from Black

Sun.



Meanwhile, BA has told Communisis Chorleys, the direct mailing and

database house responsible for BA's Smart Award-winning Executive Club

News (ECN), that all marketing activity is under review, including

ECN.



Richard Marshall, new business development director at TMW, says BA is

now likely to have "an even greater focus on data-driven communications,

especially with its most valuable customers".



Other DM suppliers serving the travel market are drawing up contingency

plans for communications in the light of the turmoil.



David Moody, the account director in charge of Avis and First Choice at

agency Perspectives Red Cell, says travel companies need to reassure

people about flying and stimulate demand with promotional activity.



Holiday firms, normally rigid in their communications schedules, "should

be prepared to be more flexible", says Moody. He believes that travel

companies will, in the short-term, shift away from brand-awareness

activity through TV and the national press to generating demand via

door-drops, loose inserts and e-mail. Rod Eddington, BA's chief

executive, has been using e-mail to reassure its Executive Club members

about the airline's security measures.



Overall, suppliers believe travel clients will look to kick-start the

market in whatever way possible. Gurdev Singh, a director of Communisis

Chorleys, says: "A lot of airlines concentrate on business travel and

neglect the consumer. There is a huge market out there for tourists,

particularly on short-haul flights."



Says Marshall: "We've had these tragic events in the US, but the worst

way for companies to react is to do nothing. You need to keep customers

loyal to your brand in these difficult times."