Low-cost regional airline Bonza entered voluntary administration on Tuesday 30 April, after flights were abruptly cancelled and its aircraft were repossessed. Bonza was poised to be Australia’s ‘friendliest’ carrier, but tough competition and a national history of fallen airlines have ultimately ‘grounded’ another fleet.

Passengers across Australia were left stranded at airports when Bonza “temporarily suspended” all of its services without further notice. The airline only commenced operations in Australia on 31 January 2023.

There are a variety of reasons for Bonza’s collapse, from limited access to airports fiercely guarded by rivals Qantas, Jetstar and Virgin Australia, to aircraft repossession by its US lessors – Bonza’s demise has definitely been turbulent.

Marketing Mag spoke with Brand Rebellion founder and managing director Bryden Campbell on why the brand failed to take off.

The challenge for challengers

Australia’s airline duopoly has long dominated the national market for more than two decades, savagely guarding their territory over flight routes, airport access and entrance of competition – or lack thereof.

Campbell says in this cost-of-living crunch, regional Australians want to see increased competition among airline carriers. “There is the perception that we are being taken for a ride, and as consumers, we want choice and competition in essential industry – not duopolies,” she says.

It’s a discussion that’s been all over the news recently. The airline industry is not the only market with big players and limited choice. Take the other salient examples of the supermarket sector: Woolworths and Coles; banking: ANZ, Commbank, NAB and Westpac; or even hardware: Bunnings and Mitre 10. 

If you haven’t already realised, Aussies don’t really have too much choice right now.

Brand Rebellion founder and managing director Bryden Campbell

“Bonza entered the market with a competitive price point and message,” Campbell says. “Low fares can open the door, but then it is about finding ways to retain customers while being financially sustainable.

“But Bonza did have some good wins on the board. As recently as March this year, it led all the other major airlines for on-time arrivals, which could have lent itself to really push the narrative of punctuality amid constant delays plaguing the other carriers.”

The brand’s altered flight path

Campbell says Bonza should have focused on communicating value beyond just low prices to attract and retain customers. “This could include emphasising service quality, unique route offerings, customer experience enhancements, or loyalty programs that incentivise repeat business. These messages would then be associated with the brand, which would allow it to change pricing strategies based on financial sustainability.”

In addition, Bonza’s initial approach of personifying its brand with names like Bazza, Shazza, and Sheila was aimed at creating an Aussie-friendly image. “While this strategy can indeed differentiate the brand and add personality, it’s crucial to consider the long-term effects on audience perception, trust, safety and brand flexibility,” Campbell says. “Brand identity should resonate broadly while still capturing the essence of the brand’s values and positioning.”

Further, Campbell says Bonza should have amped up the theme of regionality in its primary messaging. For example, by charting different routes and mixing up deals to help sell seats.

Mayday – brand connection is stalling

In such a competitive industry, the impact of brand dominance cannot be overstated. Campbell says this played a pivotal role in preventing Bonza from establishing true connections with its audience over competitors. “These brands are well recognised and have established trust over years of operation,” she says.

Notably, the two dominant airlines offered to fly stranded passengers for free*, in addition to offering support to Bonza aviation staff. Qantas has set up a dedicated section on Jetstar’s jobs website to recruit Bonza staff.

Qantas and Virgin Australia have access to the market, and control it, in ways that smaller regional brands cannot replicate. Campbell suggests tactics that the duopoly use to dominate the market and prevent competition include:

• Using pricing strategies as a competitive tool, making it harder for new entrants
• Increasing marketing efforts and ad spend, making it difficult for Bonza to compete for consumers’ attention
• Route expansion and providing services in regional areas that may have not previously been a priority
• Customer loyalty programs that incentivise brand loyalty through frequent flyers, lounge access and exclusive discounts.

How to handle a crisis

Qantas, in a statement on support for Bonza customers, shared an emotional and genuine response to the airline’s collapse. “We know the news about Bonza today is difficult for both their customers and their team members. We extend our thoughts to our aviation industry colleagues and their families – from pilots and cabin crew to flight planners and operations controllers – who will all feel the impact of today’s news,” Qantas said.

Similarly, Virgin Australia vowed to immediately support any passengers stranded mid-journey by offering complimentary seats on Virgin Australia-operated flights.

We are aware of the temporary suspension of Bonza flights.

We will immediately support any passengers stranded mid-journey by offering complimentary seats on Virgin Australia-operated flights to the airport nearest to their final planned Bonza destination.
1/2

— Virgin Australia (@VirginAustralia) April 29, 2024

The duopoly has experience in handling crises, and their heartfelt responses are strategic by design. 

Marketers can witness Bonza’s silence as perhaps a lesson in how not to act. Campbell believes while the future of the business is extremely uncertain, customers must always remain at the front of mind. 

Bonza’s social media is noticeably quiet, and their recent post on Wednesday – establishing a hotline for affected customers – has comments disabled. There is also little information available on their website, and a dedicated page for updates has only been established today.

They are instead displaying a short statement in their website header, and the ability to book any future Bonza flights also appears to be blocked.

Gaining the momentum to fly

If it was easy, anybody could do what Bonza initially set out to do. We should recognise that being a challenger brand in an industry with regulatory burdens is not for the faint-hearted.

Campbell is confident there is space for another Bonza for regional passengers who want to vote with their wallets and prevent the ‘lazy tax’ when booking flights with the same carriers.

Bryden Campbell is the founder and managing director of Brand Rebellion.

Also, read about Qantas’ recent crisis management following Alan Joyce’s retirement.

Photography attributed to Bonza.