Aviation Industry Marketing Opportunities for Growth
Aerospace and Aviation Marketing Plans
Need to be Targeted to Tap Growth
Aviation Marketing Has Always Been Key to Historical Success
The aerospace industry finds itself recalibrating after what has been a volatile 2020. While some parts of the sector accelerated during the pandemic, the aerospace industry as a whole experienced extreme challenges that spooked even the most seasoned industry leaders. However, despite border closings, quarantine measures, and even cash-strapped aviation company positions, the historical resilience of the industry seems to be playing itself out yet again – in part thanks to the quick marketing many of them have been implementing. To quote an industry executive:
“The one constant in the global airline industry is the dynamic, sudden, and impactful changes that always seems to arise. From record-breaking profits to being hit by the drastic impact of COVID-19, airlines around the world, whether small or large; local or global; always need a strong marketing vision to succeed despite varying conditions.”
– S. Patel, Vice President, GoAir
Whether working with aerospace manufacturers and aviation MROs or industry service providers and consultants, the survival of these companies is dependent on their alignment to the parts of the industry that are growing –and their ability to tap into them with targeted marketing efforts. To quote a professor of Embry-Riddle Aeronautical University:
“Aviation Marketing has always been a vital part of the success of global airlines. The current pandemic will make it even more important as the industry seeks to address challenges to their survival.”
– Dawna L. Rhoades, Embry-Riddle Aeronautical University, US.
Marketing Increases Aviation and Aerospace Opportunities
While commercial airlines have typically utilized more marketing than any other parts of the aerospace and aviation industry, other companies in the space are actively catching up to meet the new marketing demands that the pandemic has forced upon the entire industry (particularly digital marketing ones). Everyone from aircraft operators to aerospace manufacturing companies are modernizing their marketing efforts.
As history has taught many sectors within the industry, marketing alignment is critical to accelerating their ability to bounce back. In fact, the industry’s quick action (as well as changing dynamics related to COVID19) are starting to reveal themselves. According to recent research by Deloitte and Touche, the “Global aerospace and defense (A&D) industry revenue is expected to begin to recover in 2021 after a difficult year in 2020 and with long-term growth prospects for the industry remaining strong.” Even the IATA is predicting a faster recovery –with the industry turning cash positive in late 2021. From a consumer perspective, Bloomberg has also started discussing a faster post-pandemic recovery.
However, in order for aviation companies and industries in their ecosystem to capture growth opportunities, they must position their marketing to tangible growth areas in the marketplace. For aviation industry executives looking for hidden opportunities, here are some key industry trends we see as important to include in your 2021 marketing plans.
Changes in Airworthiness Directives and Improvements in Internal Processes and Procedures
Airworthiness Directives (AD) Marketing Opportunities for Aerospace Manufacturers and Consultants
The grounding of the aviation industry, combined with the scandals of the Boeing MAX 737, has the FAA and other international regulatory bodies modifying their safety requirements for some of the most active aircraft types around the world. These new AD rules are being applied to both commercial and non-commercial aircrafts. For example, fuel ignition mitigation safety requirements for the Boeing 737 and B767 have changed. Furthermore, cargo planes now are required to meet FAR 25.981 and FTFR Rule safety requirements –traditionally only needed for commercial planes.
These important regulatory changes create opportunities for aerospace manufacturing companies, consulting companies, and even project management/procurement outfits that support the sourcing of key equipment needed to meet these new regulations. Here is an example of the European regulatory body announcing such new airworthiness directives for aircraft flying in their jurisdiction.
These changes in AD are also creating opportunities for companies that are currently not working with the aviation industry. For example, technology and cleaning startups who usually do not have easy access to the aviation industry are now helping aviation companies meet new safety standards with the use UV cleaning technology. Marketing materials that position you as a solution for these aviation companies will be key to helping you get a seat at the table within an industry that is changing and expected to recover with vigor in the coming 18 months.
Aerospace and Defense Growth in Asia-Pacific
International Aviation Market Growth and Marketing Focus
There has been a noted increase in demand for aerospace and defense products and services in the Asia-Pacific region. This region has experienced unprecedented growth and has not been impacted by the pandemic like the U.S. and Latin America. As a result, the region is still charging on with its aviation growth efforts. In fact, according to Aviation Week Network, the Asia-Pacific region will have the largest total of in-service military aircraft by 2030. In addition, 37.5% of all new-build military aircraft delivered over the next decade will be purchased by countries in that region, more than anywhere else in the world. With the increase in military expenditure opportunities paired with a region moderately impacted by COVID19, this region is expected to be one of the first to recover from the impact of the pandemic. Companies looking to tap opportunities in this region need to develop localized marketing materials that have messaging and branding that aligns to the needs and culture of this region.
Increased M&A within the Aviation Industry
Marketing to Increase an Aerospace Company’s Competitive Position
One other interesting aviation industry trend has been the rise of mergers and acquisitions. Per Greg Nossaman, senior managing director of The McLean Group, “We’re seeing deal activity accelerate — arguably a 10-year-high, in terms of deal volume, and in terms of valuations.”
In fact, according to Mergermarket data, $98.5 billion in aerospace and defense industry deals were disclosed in 2019. That is an increase of 133% from 2018. Five of the deals in 2019 were over $1 billion, compared to 2018 (three). The result has been that, during the pandemic, many larger firms have been eyeing small and medium sized businesses within the industry.
This is an interesting proposition for many companies in the industry since most, according to the ITIA, only have about 8 months’ worth of cash reserves to respond to a crisis. Also, given the Federal Reserve’s focus on maintaining low-interest policy to support the U.S. economy, inexpensive debt will be readily available – making it a sellers’ market and encouraging more M&A activity. While it remains uncertain how the new administration will impact this trend, it is expected that the Biden presidency will provide fertile ground for more robust M&A in 2021.
A company’s ability to leverage marketing to package their brand and business in a manner that speaks to investors is critical to be in a position of strength for a joint venture, merger, or acquisition opportunity. Having a solid marketing plan that is aligned to today’s market forces, will also be critical to helping investors feel confident moving forward.
Experienced Aviation and Aerospace Marketing Company
EWISE Communications is a sales-oriented marketing company that has actively worked with the aviation industry to help them focus their marketing on growth. Whether working on branding, ongoing communications, digital marketing or public relations, EWISE has the marketing and aviation industry knowledge to help your company grow and rise above the competition. To contact us, click here.