Tuesday, June 12, 2001

Cheap Tickets
spreading the
word in U.S.

The isle discount retailer launches
an ad campaign that is its most
extensive since going public in 1986

By Russ Lynch

Cheap Tickets Inc. is launching a new national advertising campaign to promote the company's discount fares as "the best kept secret in travel."

The Honolulu-headquartered company declined to say how much it is spending on the campaign except that it is at the multimillion-dollar level and is the most comprehensive promotion the company has run since it was formed in 1986.

The centerpiece is a 30-second television commercial, showing how those "in the know" pass to others their knowledge about Cheap Tickets' exclusive access to more than a million unpublished air fares and other discount travel services.

"Cheap Tickets has air fares you won't find anywhere else and they're up to 40 percent off," the commercial says.

The announcement of the new marketing push came just a week after the debut of, the new travel bookings Web site owned by the five U.S. airlines that combined have 85 percent of the domestic airline business. Over the months of preparation for the Orbitz launch, online reservations competition has increased in intensity.

But Cheap Tickets downplayed the timing, saying it has been making its own plans for many months and is not just responding to Orbitz.

"This is all part of a long-term repositioning of Cheap Tickets," said a spokeswoman in Honolulu, Dawn Soper Lyon.

Lyon said the advertising campaign is just one more in a series of steps that began last year, which included technology upgrades to help the way customers interface with the company's Web site, training and added support to improve customer service and other aspects of what the company does.

Orbitz said it sold $1 million worth of tickets online in its first day and more than $3 million in its second day, a week ago.

Cheap Tickets reported gross bookings, its overall sales of all type, of more than $2 million a day in the first quarter of this year. Its business has been growing steadily. Gross bookings in the first quarter of 2000 were about $1.77 million a day.

The Cheap Tickets campaign, prepared by the J. Walter Thompson agency in San Francisco, includes television, radio, print and Web advertisements that show a new corporate logo and stress the 24-hour availability of the company's call centers and Web site.

"These new ads reflect a growing and more aggressive Cheap Tickets and build on the fundamentals that have made us successful over our 15-year history -- low price, convenience and personal customer service," Cheap Tickets President and CEO Sam E. Galeotos said yesterday. "This campaign is designed to get Cheap Tickets' secret out to a broader range of consumers. We want people to know we're more than just a Web site."

He said Cheap Tickets beats the prices on the airlines-owned Orbitz Web site because of its "unpublished" fares. They are deeply discounted prices made available only to Cheap Tickets under arrangements with dozens of airlines, who contract with Cheap Tickets to sell seat inventory that is still unsold as flight times approach.

Evans Gebhardt, Cheap Tickets vice president of marketing, said the company has already proven the effectiveness of the new campaign. In direct-response testing in targeted markets, sales were at least 25 percent higher than in equivalent markets using the old campaign, he said.

At the end of the last quarter, Cheap Tickets had more than $50 million in the bank, mostly from an earlier stock issue. The company said it raised the money to finance system improvements, expansion and marketing. Cheap Tickets said today the company does not make public the specific amounts it spends on each segment of its business, such as advertising.

Cheap Tickets closed up 82 cents today at $16.13.

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