Kulula - Anyone Can Fly

Wits Business School

WBS-2003-4(a)

kulula.com: Now Anyone Can Fly (Abridged)

It was January 2003, 17 months since kulula.com had taken to the skies for the first time. This lowcost airline had survived almost two years in an extremely tough industry and had been very successful since its inaugural flight on 1 August 2001. Gidon Novick, kulula.com's executive manager of marketing, was involved in its unusual, but highly successful communication strategy from day one and maintained a close relationship with the advertising agency, morrisjones&co. But despite its success, Novick did not feel comfortable. He realised that the business might soon face a problem – the possibility that the hype in the market had declined to a certain extent or could do so in the near future. He knew that in the fiercely competitive airline industry one could never sit back and relax. It was time to rethink kulula.com's communications strategy. Novick could not afford to miss a single significant fact in establishing whether the current formula was sustainable or not. There was the lurking threat of other competitors entering the market – such as national carrier SAA with its own low-cost airline. Even the current relationship with kulula.com’s advertising agency needed some reconsideration. Background on the Low-Cost Airline Industry The deregulation of the domestic airline industry in the US in 1978 and in the UK in 1979 opened up the market for the entry of other competitors, such as low-cost airlines, into a domain that had had previously been exclusive to government-subsidised national flag-carriers.1 Despite the seemingly crowded market in Europe, discount airlines such as easyJet, Ryanair, Buzz and Virgin Express had all grown stronger and had placed Europe's traditional flag carriers under severe threat.2

1 Up until 1978 the global airline industry had been controlled mainly by national governments that owned or subsidised the so-called national flag-carriers, which...