The brand AirAsia made its true arrival when it was reborn in 2001 as a new acquisition by Tune Air Sdn Bhd, a company jointly founded by Dato’ Tony Fernandes, together with founding partners Dato’ Pahamin, Dato’ Kamarudin Meranun, and Abdul Aziz Bin Abu Bakar. The history of AirAsia may have started a few years earlier, but this is where the romance began.
Taken from Malaysia’s Most Valuable Brands 2007 and Air Asia is ranked 19
Flights to Fancy
Fun, affordability and convenience. By making these three magic words come true, AirAsia has given wings to a nation and opened new gateways to the world.
New Markets, New Channels and a Brand New Lifestyle
AirAsia’s initial outing, under the ownership of DRB-Hicom, was fraught with difficulties due to various unforeseen circumstances, including the 1997 economic crisis. By the time Dato’ Tony Fernandes and his three partners acquired the loss-making airline in 2001 for a mere RM1, it comprised little else besides two aircraft and a RM40 million debt. The airline’s new management positioned the brand’s relaunch not only as a new service, but also a new era in travel, with a new generation of air travellers to usher it in. The tagline Now Everyone Can Fly proclaimed the brand’s mass market appeal while the carrier’s incredibly rock-bottom promotional fares hammered it home. Air travel would no longer be reserved for the elite. Those who would accuse AirAsia of vying for Malaysia Airlines’ market had little to substantiate their opinion.
Where the national carrier worked to exude prestige, poise and corporate appeal, AirAsia was a playful young maverick whose crew cracked jokes over the in-flight PA system and cajoled freeseating passengers into winning AirAsia merchandise by answering quizzes and playing games while the aircraft cruised to its destination. “Easy to Book, Easy to Pay & Easy to Fly” defined the customer experience that AirAsia aimed for. The AirAsia website empowered would-be passengers to make their own flight schedule inquiries, plans and ticket purchases online. Currently, the multi-lingual portal records an average of 90 million impressions every month and Internet transactions now account for 70 percent of AirAsia sales.
Red — AirAsia’s corporate colour — is used assertively for the parent brand as well as for related products such as GoHoliday (its holiday package portal), GoInsure and the AirAsia credit card. In fact, AirAsia’s introduction of a cobranded credit card in 2004 was another first for any airline in Malaysia, and one that turned casual holiday-making into a lifestyle statement that customers could carry everywhere in their wallet.
Bringing Asia Together, Bringing Asia to the World
What started as a new era of travel for Malaysians soon became AirAsia’s proposition to the region. From its early route selections to Penang, Senai and Bangkok, the airline has dramatically expanded its operations to over 75 destinations in Malaysia, Thailand, Indonesia, Macau, China, Philippines, Cambodia, Vietnam and Brunei. The journey has not always been easy, however. The 2004 tsunami disaster, SARS, bird flu and Thailand’s coup d’etat were just some of the hurdles that the airline has had to overcome. Another major challenge was AirAsia’s forced move from its original hub in Subang to the Kuala Lumpur International Airport (KLIA) in 2002. Operating from KLIA posed numerous disadvantages to the airline, including higher costs and flight timing issues. AirAsia director and group CEO Dato’ Tony Fernandes spared no effort in making this known to the Malaysian public, but the authorities decided not to restore the Sultan Abdul Aziz Shah Airport in Subang as a low cost carrier terminal.
This disappointment was somewhat mitigated by the construction of a new low cost carrier terminal, or LCCT, in Sepang. Launched on 23 March 2006, this facility was Malaysia’s and Asia’s first. It narrowly beat Singapore’s budget terminal launch by just a few days and there was no doubt that the Sepang LCCT’s viability was entirely driven by AirAsia’s rapid expansion. Further evidence of the regional “travel revolution” that AirAsia has ignited is Malaysia’s second low cost terminal, launched less than a year later in Kota Kinabalu in February 2007. Southeast Asia’s fast-growing population of 500 million is an opportunity well noted by the airline, and it is poised to tap into this market with a total aircraft order that currently stands at 150 Airbus a320, with another 50 options on hand.
By 2012, delivery on this order will make AirAsia the second largest a320 operator in the world. In 2007, at just five years of age, AirAsia received the title of Best Low Cost Airline in Asia from Skytrax and the Brand Laureate Award for Brand Excellence in the Airlines — Low Cost Carrier Category.
The AirAsia Brand, Up Close and Personal
One thing a budget challenger brand can get away with is endearing itself to the customer through mischievous and irreverent candour. While Malaysia Airlines’ status as a premium brand and national carrier compels it to maintain a certain reserve, AirAsia maximises its appeal by breaking barriers. As the brand’s key champion, Dato’ Tony Fernandes is the consummate personification of the youthful dynamism, passion and egalitarianism that AirAsia stands for.
Not one to stand on ceremony, the CEO has often shared his hopes and disappointments concerning AirAsia with an honesty that teases the boundaries of political correctness. He also preaches the importance of affirming AirAsia’s people as its greatest assets and sees to it that this ethos is put into practice. “Many CEOs make mistakes in their decision making while sitting in their offices away from the action, so every once in a while I’ll go down and work with my crew, doing jobs like checking in passengers for example,” he explains. At AirAsia, the development of human capital is recognised as paramount to brand growth and this has not gone unnoticed. In August 2007, Frost & Sullivan honoured AirAsia Academy the prestigious Airline Human Capital Development Strategy Award for the Asian Commercial Pilot Training Market.
Partnerships and New Horizons
AirAsia launched its own in-flight magazine on 8 August 2007. Travel 3Sixty anticipates a monthly readership of at least 700,000 and is designed to increase the airline’s interaction with its customers while creating a desirable communication platform for a wide spectrum of advertising partners. AirAsia has also armed its brand with an impressive array of powerful brand associations. It has just signed a three-year contract to be the official sponsor for England’s Professional Game Match Officials Limited (PGMOL). This is in addition to a successful existing (and very colourcompatible) sponsorship commitment to the Manchester United football club, and a more recent tie-up with leading Formula 1 team AT&T Williams.
Meanwhile, excitement is building up as AirAsia X, an affiliate of AirAsia and Virgin Group, prepares to take the brand to new heights as the world’s first truly long haul low cost airline. It will be an extension of AirAsia’s successful short haul low cost model in Southeast Asia and is scheduled to make its inaugural flight from Kuala Lumpur to the Australian Gold Coast in the final months of 2007. In a clear move to associate itself with an international heritage of low cost carrier excellence, AirAsia X named its first leased long-haul Airbus A330–300 ‘Semangat Sir Freddie’, in tribute to the pioneer of the low cost model, the late Sir Freddie Laker. The brand’s ambitiousness is impossible to miss. Its humble beginnings, popular appeal and bold, dare-to-be-different attitude have been an inspiration not only for Asia but also the world.