Airlines in Brazil open ‘mini stores’ at subway stations to engage
emerging middle class

30 January 2012 | Brazil, the largest South
American country, has recently enjoyed a tremendous growth of its middle class,
resulting in increased demand for aviation. In fact, the Brazilian middle class
grew from 30 percent of the population in the 1960s and ‘70s to 55 to 60 percent in 2011. In 2010, the
lower-middle class accounted for 34 percent of domestic tourism, almost double that
of 2002. In the last 10 years, the demand for air travel in Brazil has increased
by 194 percent. Much of this increased
demand comes from the members of the new Brazilian middle class, many of whom
are entirely new to air travel. TAM estimated that in 2011 there were
going to be 10.7 million first-time flyers.

Brazil’s airlines have been developing innovative strategies as they compete
to win over this new market. In the past, airlinetrends.com discussed marketing
strategies adopted by TAM to target this first-time flying segment. TAM, and its low-cost
competitor GOL, have continued to target the emerging middle class with novel
sales channels, including sales kiosks at subway and bus stations.

GOL
During 2011, GOL opened kiosks in subway stations where they
provide not only information, but also the option to book, change and/or cancel
a flight. The first kiosks were opened in Sao Paulo’s Itaquera, Sé and Luz
subway stations in March 2011 and GOL subsequently opened additional kiosks in
Sao Paulo’s Tatuapé station, Rio de Janeiro’s Central do Brasil station, Porto
Alegre’s Estação Mercado do Metrô station, and one in Salvador.

The main goal of this new distribution channel is to engage the new Brazilian
middle class in aviation. According to GOL’s Market Vice President, Claudia
Pagnano, “The new identity comprises items referring to airports, as well as
illustrations showing the main phases of a flight.” In order to provide better
service and meet the needs of a ‘typical’ subway user, GOL’s kiosk teams
completed 20 days of specialized training courses that focus on the habits of
the emerging middle class, selling techniques, and language skills.

TAM
TAM’s first staffed subway station kiosks were opened in August 2011 at Sao Paulo
stations Corinthians-Itaquera, Ana Rosa and São Bento. TAM has since opened two
more kiosks in Rio de Janeiro’s subway stations Botafogo and Central.

The subway station kiosks are part of TAM’s “new retail project” marketing strategy, which was
launched in 2010 with the goal of strengthening TAM’s efforts “to make plane
tickets increasingly more accessible to the overall Brazilian population.” According to Paulo Castello Branco, Vice President
of Sales and Planning, “Our plan is to have 200 [travel] stores open by 2012. 
What we want is that the new publics perceive that they can travel with us and
will have access to our sales channels.”

Among the first steps in this marketing project was the opening of sales points in Brazil’s well-known retail store, Casas Bahia.
TAM’s subway kiosks have benefitted from TAM’s experience with the Casas Bahia
sales points. Says Líbano Barroso, president of TAM, “the business model we
implemented in the Subway Project was tried and tested at our kiosks at Casas
Bahia.”

TAM’s employees working in the subway stations were not just trained to sell
tickets, but also to help first-time flyers navigate the system, from learning
about financing and booking flights to what time to arrive at the airport, how
to check-in luggage, and other logistics of flying.

TAM has also expanded their sales points to include bus stations and has
signed agreements with Pássaro Marron, a bus company presently serving 50 cities
in the States of São Paulo and Minas Gerais, and with Princesa do Agreste, a bus
company serving 29 north-eastern cities. In both cases, TAM agreed to sell the
bus company’s tickets at TAM stores in return for selling air tickets at the bus
stations. The Pássaro Marron agreement did not last long, however, as the bus
company was acquired by TAM’s competitor,
GOL.

GOL and TAM both say they plan to continue expanding these channels of
distribution, both in more subway stations and through other venues, to target
the emerging middle class.