Airline Marketing and Management
What is a customer? We should be able to differentiate between the customer and also the consumer. Consumers are those people who actually travel, and this could be anyone out there. It is therefore easy to identify and recognize them by analyzing them through means such as giving out questionnaires. They may not be, however, decision makers for the things that matter, and such decision makers would be known as customers.
Four customers that we need to analyze now, and they would be asking these sort of questions:
1) Will a trip be made at all?
The cost of air travel is known to be quite expensive compared to other modes of transports.
In a recessionary period, firms would tend to reduce expenditure and reduce travel
altogether. For the business traveler, customer for the airlines are usually the CEO or the
Vice President-Finance, because they would determine whether their staff are going to
travel for business purposes and whether the travel are going to funded or not.
2) What mode of transportation would be selected?
Customers would also be asking, which transportation mode would be the best to be selected for a particular travel. On short-haul routes, railways would be able to provide superior door-to-door journey times. For leisure travelers the attraction of surface transport would be a highly tempting one.
3) For air trips, what class of service would be purchased?
In order to maximise the amount of high yielding traffic available to them, carriers would have to target the people who make decisions about corporate travel policies.
4) Which airline would be selected?
Finally, after asking all these questions, it would still be left to the customer to decide which airline he will be choosing.
Industrial Buying Behavior.
In consumer marketing, it is possible just to target the individual or family in getting their confidence to subscribe to a company. In the Industrial Marketing, it is different where purchasing decisions will often be made in many different and complex ways passing through the many corporate executives called the Decision- Making Unit or DMU.
There are five categories altogether.
1)Deciders
2)Gatekeepers
3)Users
4)Buyers
5)Influencers
Identifying the Customers in Leisure Air Travel
How are travel decisions made in a family. Usually in a family, children will have a significant influence on travel buying decisions made by parents. Families may opt to choose airlines which caters to their children. For older children, the choice of vacation may be made by parents, but after having considered the children preferences.
Also important, is whether men or women have a greater influence in holiday decision-making.
It should also be recognize that the travel agent is very important, such as deciding on the question of the vacation destination.
In targeting leisure air traveler, airlines must regard senior managers and product managers of major Tour Operators as very important customers. No success can be achieved in this market unless they can persuade Tour Operators to feature the destinations they serve in their brochures and websites, and if they do, to buy their seats from the airline.
Market segmentation
A market segment is defined as:
"a group of customers who have sufficient in common that they form a viable basis for a product/price/promotion combination."
Two mistakes are possible when segmenting, under-segmentation and over-segmentation. The former occurs when customers are grouped into segments which are too large, and differences are simply too great while the latter is when the segments are isolated with too many segments made.
The segment variables in the pax. market include:
1) Journey purpose
2) Length of journey
3) Country/culture of origin of traveller
The customer requirements of the Biz Travel Market
1) Freq. and timings
2) Punctuality
3) Airport location and access
4) Seat accessibility/ Ticket flexibility
5) Frequent Flyer Benefits
6) Airport Service
7) In-flight Service
Segmentation of the Air Freight Market
Firstly lets talk about the differences between the Air passenger and freight markets.
Firstly, the air freight only travels one way on a route, in contrast with passenger markets. While acknowledging the existence of passengers flying one way like emigrating to another location, this is often not significant in number.
The secon is the differences handling and stowage conditions required of the two. For air freight, care should be properly exercised with regards to fragile items. Other items would be of high value, such as banknotes. This would mean the arrangements of special security measures. Perishable goods is another example, where carriers should provide necessary commodities such as refrigeration.
However, the most important difference is in terms of the nature of competition between the two. For the passenger side, there are not many competitions from other modes of transport with regards to long-haul routes. For air freight, many alternatives would always be on the table and this provides intense competition because of the price. Surface transport will be a much more cheaper option.
Air freight is more expensive because it is a faster way of transport, which leads us to the first segmentation which is emergency traffic. This can be broken further into Operating Emergency and Marketing Emergency.
Operating Emergency is when a firm needs to rectify a problem, such as a breakdown. This would require spare parts to be shipped to the location as fast as possible and the longer it takes to arrive the more loss it would incur. So here, the choice of air transportation would be the most obvious option.
The second type of emergency can be illustrated when a supplier is in danger of missing a dealine, or when a customer is dissatisfied with a product and wants a replacement.
Four customers that we need to analyze now, and they would be asking these sort of questions:
1) Will a trip be made at all?
The cost of air travel is known to be quite expensive compared to other modes of transports.
In a recessionary period, firms would tend to reduce expenditure and reduce travel
altogether. For the business traveler, customer for the airlines are usually the CEO or the
Vice President-Finance, because they would determine whether their staff are going to
travel for business purposes and whether the travel are going to funded or not.
2) What mode of transportation would be selected?
Customers would also be asking, which transportation mode would be the best to be selected for a particular travel. On short-haul routes, railways would be able to provide superior door-to-door journey times. For leisure travelers the attraction of surface transport would be a highly tempting one.
3) For air trips, what class of service would be purchased?
In order to maximise the amount of high yielding traffic available to them, carriers would have to target the people who make decisions about corporate travel policies.
4) Which airline would be selected?
Finally, after asking all these questions, it would still be left to the customer to decide which airline he will be choosing.
Industrial Buying Behavior.
In consumer marketing, it is possible just to target the individual or family in getting their confidence to subscribe to a company. In the Industrial Marketing, it is different where purchasing decisions will often be made in many different and complex ways passing through the many corporate executives called the Decision- Making Unit or DMU.
There are five categories altogether.
1)Deciders
2)Gatekeepers
3)Users
4)Buyers
5)Influencers
Identifying the Customers in Leisure Air Travel
How are travel decisions made in a family. Usually in a family, children will have a significant influence on travel buying decisions made by parents. Families may opt to choose airlines which caters to their children. For older children, the choice of vacation may be made by parents, but after having considered the children preferences.
Also important, is whether men or women have a greater influence in holiday decision-making.
It should also be recognize that the travel agent is very important, such as deciding on the question of the vacation destination.
In targeting leisure air traveler, airlines must regard senior managers and product managers of major Tour Operators as very important customers. No success can be achieved in this market unless they can persuade Tour Operators to feature the destinations they serve in their brochures and websites, and if they do, to buy their seats from the airline.
Market segmentation
A market segment is defined as:
"a group of customers who have sufficient in common that they form a viable basis for a product/price/promotion combination."
Two mistakes are possible when segmenting, under-segmentation and over-segmentation. The former occurs when customers are grouped into segments which are too large, and differences are simply too great while the latter is when the segments are isolated with too many segments made.
The segment variables in the pax. market include:
1) Journey purpose
2) Length of journey
3) Country/culture of origin of traveller
The customer requirements of the Biz Travel Market
1) Freq. and timings
2) Punctuality
3) Airport location and access
4) Seat accessibility/ Ticket flexibility
5) Frequent Flyer Benefits
6) Airport Service
7) In-flight Service
Segmentation of the Air Freight Market
Firstly lets talk about the differences between the Air passenger and freight markets.
Firstly, the air freight only travels one way on a route, in contrast with passenger markets. While acknowledging the existence of passengers flying one way like emigrating to another location, this is often not significant in number.
The secon is the differences handling and stowage conditions required of the two. For air freight, care should be properly exercised with regards to fragile items. Other items would be of high value, such as banknotes. This would mean the arrangements of special security measures. Perishable goods is another example, where carriers should provide necessary commodities such as refrigeration.
However, the most important difference is in terms of the nature of competition between the two. For the passenger side, there are not many competitions from other modes of transport with regards to long-haul routes. For air freight, many alternatives would always be on the table and this provides intense competition because of the price. Surface transport will be a much more cheaper option.
Air freight is more expensive because it is a faster way of transport, which leads us to the first segmentation which is emergency traffic. This can be broken further into Operating Emergency and Marketing Emergency.
Operating Emergency is when a firm needs to rectify a problem, such as a breakdown. This would require spare parts to be shipped to the location as fast as possible and the longer it takes to arrive the more loss it would incur. So here, the choice of air transportation would be the most obvious option.
The second type of emergency can be illustrated when a supplier is in danger of missing a dealine, or when a customer is dissatisfied with a product and wants a replacement.
Comments
Post a Comment