United low cost carrier..It's Ted, officially
United embraces friendly nickname for low-fare carrier
By David Kesmodel, Rocky Mountain News
November 12, 2003
CHICAGO - What's in a name? At United Airlines, a lot.
United executives said they picked Ted - "Yup, Ted," as the ads say - as the name for their new low-fare carrier because it met two seemingly conflicting goals: to be familiar and different.
Ted is the last half of United, so it's already part of the United brand, executives said. It's also a nickname, making the new carrier seem approachable and friendly. And yet it's an unusual name for an airline.
"Our objective was to provide both a product and a brand that was comforting to United loyalists but also would surprise new consumers," said John Tague, United's executive vice president for customers.
Ted beat out more than 100 other names in a nine-month process led by consulting firm Pentagram Design. One finalist was Rhapsody, part of Rhapsody in Blue, United's theme song.
United and its ad agency, Fallon Worldwide, have used the Denver teaser campaign for Ted - including mysterious pizza giveaways and spectators at sporting events shouting "Go Ted!" - to make Ted seem chummy and alluring.
"We came to the conclusion that unexpected outcomes have much more upside in terms of creating a community around the new brand," Tague said. "Unexpected outcomes are particularly unexpected for airlines."
Ted, with blue and marigold-orange colors, will start flying from its main hub, Denver International Airport, in February and will be integrated into the United route network.
Ted will offer food for sale and possibly pay-per-view TV programming. Tickets go on sale this month.
The carrier-within-a-carrier is part of United parent UAL Corp.'s effort to emerge from bankruptcy next year and fend off growing competition from discounters. One of Ted's chief goals is to wrest customers from Denver-based Frontier.
Chicago-based United, DIA's biggest carrier, is launching Ted in the face of deep skepticism among analysts. Many say airline-within-an-airline concepts are doomed, citing the failure of all previous efforts, including one by United.
United says Ted will succeed in part because its cost structure will be much lower than that of the company's previous discounter, Shuttle by United, which stopped operating in 2001.
"Every time you hear people with supposed industry experience saying something can't be done, be a little skeptical," said Phil Roberts, an industry consultant in Hayward, .Calif. "At this point in time, it hasn't been done. But that's not to say it can't be. But there are lots of hurdles to overcome."
Roberts said the branding "sounds quite clever."
He added: "I thought JetBlue was kind of strange when they came up with it, but you get used to a name."
Some are blasting the moniker.
"It is hard to believe that this is the best they can do," Robert Polk, head of Denver travel agency Polk Majestic Travel, said in his weekly newsletter. "We have decided that this name is worse than Delta's (fledgling) low-cost carrier named Song, and just about as bad as" Air Canada subsidiary Zip, he said.
The highlights of Ted that United soon will announce include:
Ted will offer food for sale a la carte, including Ted-branded meals and beverages.
Ted initially will fly to at least eight leisure markets from Denver, including Las Vegas, Phoenix and Fort Lauderdale, Fla., a city United never has served from Denver. Destinations in Mexico and the Caribbean are under consideration.
Ted's 156-seat Airbus A320 jets will have 66 seats with extra leg room.
United's frequent-flier program will include a "Ted club" component
Ted will fly from designated gates at DIA. The group of gates will be either on Concourse A or B.
United executives say they are working on an in-flight entertainment system unique to Ted. "We're exploring some new, rapidly developing technology that will give our consumers access to free in-flight (TV) but also some paid-for-choice options," Tague said.
United chose the name Ted for a number of reasons. One is that it's a diminutive - short for Theodore.
"That seemed to signal a promise of a slightly more fun or casual experience, as opposed to the business- like professional experience people have come to associate with United mainline," said Michael Bierut of Pentagram.
United is not targeting a specific demographic. Instead, it sees its fliers "as sort of ageless," Tague said.
The teaser campaign began Oct. 29 and continues. The focus is on goodwill - such as flowers sent by Ted to the hospitalized - instead of statements such as "Ted is coming."
United kept the mystery of Ted alive until the evening of Nov. 6, when the Rocky Mountain News unmasked him in a Web site report.
Industry experts, having heard the hype, are waiting to see how the new carrier performs against tough competition from Frontier, JetBlue, Southwest and others. Frontier serves all of Ted's initial markets.
Evergreen-based consultant Mike Boyd said in a report Monday that "key questions remain blissfully unanswered about Ted." He said it will be tough to get Ted's costs low enough to outperform rivals, and he questions whether some premium United fliers will be turned off by the "intermingling" of products.
United says Ted will be cost-competitive because the company has drastically cut labor costs in Chapter 11, turnaround times at the gate will be faster than United's and planes will average 11.5 hours a day in the sky, up from less than 10 at United last year.
kesmodeld@RockyMountainNews.com or 303-892-2514.
