Learning Branding by Studying Great Brands
I often find that the most insightful lessons come from companies that challenge the status quo. Southwest Airlines is a prime example of a brand that let its values and passion for fairness drive business decisions. Can the airline continue its unconventional success while now shifting to embrace the status quo?. I've written a paper that aims to find out.
From Maverick to Mainstream
A Brand at a Crossroads
Southwest Airlines, long known for its unique “maverick" brand and low-cost model, is undergoing a major strategic shift.
After decades of building a loyal customer base with its “People First" philosophy, the airline is moving away from two of its most iconic policies: “Bags Fly Free" and open seating. This pivot is a response to a changing economic landscape and pressure from investors, as the airline lags behind rivals like Delta and United, who are thriving on more profitable international and business travel. By adopting a revenue model with ancillary charges for things like checked bags and assigned seats, Southwest is stepping onto the same financial playing field as its legacy competitors.
The new bag fees alone are projected to generate over $350 million in earnings for 2025, with revenue contributions “exceeded expectations". However, this financial success tells only part of the story. While Southwest's leadership claims there has been “no customer reaction" to the fees, a segment of long-time loyalists feels a sense of “brand betrayal" and that the airline is now “just like every other airline". The company's data measures immediate transaction behavior, but it fails to capture the long-term erosion of trust and loyalty among its most dedicated customers, who chose the airline for its unique value proposition.
The Financial Gamble and a Fractured Customer Base
While the policy changes present a significant risk to the brand's core identity, they have already shown a positive financial impact.
Rebuilding Brand Identity
Southwest is now faced with a fundamental question: What defines its brand without the “Forever Agreements" that once set it apart?
The company's executives are attempting to reframe the brand around “choice" and “customization," but this new promise is the same one its competitors have used for decades. To navigate this shift, Southwest must proactively and transparently communicate the reasons for these changes and identify new brand pillars to replace what has been lost. The airline should consider enhancing its loyalty program to reward its most valuable customers, making it a cornerstone of the brand's new value proposition. By doing so, Southwest can shift the focus from a “slow-motion collapse" into just another airline to a new identity that protects its most loyal customers.