Airline Marketing and Management

by Stephen Shaw

Overview

Through six previous editions, Airline Marketing and Management has established itself as the leading textbook for students of marketing and its application to today's airline industry, as well as a reference work for those with a professional interest in the area. Carefully revised, the seventh edition of this internationally successful book examines an exceptionally turbulent period for the industry. It features new material on: *Changes in customer needs, particularly regarding more business travellers choosing - or being forced - to travel economy, and analysis of the bankruptcy of 'All Business Class' airlines. * An explanation of the US/EU 'Open Skies' agreement and analysis of its impact. *The increase in alliance activity and completion of several recent mergers, and the marketing advantages and disadvantages that have resulted. * Product adjustments that airlines must make to adapt to changes in the marketing environment, such as schedule re-adjustments and the reconfiguration of aircraft cabins. *Changes in pricing philosophies, with, for example, airlines moving to 'A La Carte' pricing, whereby baggage, catering and priority boarding are paid for as extras. *Airline websites and their role as both a selling and distributing tool. *The future of airline marketing. A review of the structure of the air transport market and the marketing environment is followed by detailed chapters examining business and marketing strategies, product design and management, pricing and revenue management, current and future distribution channels, and selling, advertising and promotional policies. The reader will benefit from greater understanding of both marketing and airline industry jargon and from knowledge obtained regarding the extraordinary strategic challenges now facing aviation. Written in a straightforward, easy-to-read style and combining up-to-date and relevant examples drawn from the worldwide aviation industry, this new edition will further enhance the book's reputation for providing the ideal introduction to the subject.

Product Details

ISBN-13:	9781409486688
Publisher:	Ashgate Publishing Ltd
Publication date:	10/01/2012
Sold by:	Barnes & Noble
Format:	eBook
File size:	2 MB

About the Author

Stephen Shaw is Managing Director of SSA Ltd, UK, a firm specialising in providing courses in marketing and economics to airlines and aerospace firms, located at Chinnor, Oxford, England.

Table of Contents

	Introduction	xii
1	The Fundamentals	1
1:1	What is Marketing?	1
1:1:1	Definition	1
1:1:2	The "Marketing Mix"	2
1:1:3	Stages in the Application of Marketing Principles to Airline Management	3
	Successful Airlines	5
2	The Market for Air Transport Services	6
2:1	What Business are we in?	6
2:2	Who is the "Customer"?	8
2:2:1	Definitions	8
2:2:2	"Apparent" and "True" Needs	10
2:2:3	Industrial Buying Behaviour	12
2:2:4	The "Customer" in the Business Air Travel Market	15
2:2:5	The "Customer" in the Leisure Air Travel Market	18
2:2:6	The "Customer" in the Air Freight Market	20
2:3	Market Segmentation--Air Passenger Market	22
2:3:1	The Concept	22
2:3:2	Segmentation Variables in the Air Passenger Market	23
2:3:3	Customer Requirements--Business Travel Market	26
2:3:4	The Business Travel Market--Demographics and Psychographics	34
2:3:5	The Leisure Segment of Demand	36
2:4	Segmentation of the Air Freight Market	39
2:4:1	Differences between the Air Passenger and Air Freight Markets	40
2:4:2	Segmentation Variables--Air Freight Market	41
	Successful Airlines	47
3	The Marketing Environment	49
3:1	The Theoretical Basis--PESTE Analysis	49
3:2	PESTE Analysis--Political Factors	50
3:2:1	Terrorism Fears/Political Instability	50
3:2:2	Deregulation and "Open Skies"	51
3:2:3	Marketing Policies for a Deregulated Environment	55
3:2:4	Privatisation	57
3:2:5	"State Aid"	59
3:2:6	Airport Slot Allocation	60
3:3	PESTE Analysis - Economic Factors	64
3:3:1	Economic Growth and the Trade Cycle	64
3:4	PESTE Analysis--Social Factors	65
3:4:1	The Ageing Population	65
3:4:2	Changing Family Structures	66
3:4:3	Changing Tastes and Fashions in Holidays	66
3:4:4	The Uncertain, Deregulated Labour Market	67
3:4:5	The Female Business Traveller	68
3:5	PESTE Analysis--Technological Factors	69
3:5:1	Video-conferencing	69
3:5:2	The Internet	70
3:5:3	Surface Transport Investment	70
3:6	PESTE Analysis--Environmental Factors	71
3:6:1	Global Warming	72
3:6:2	Shortages of Infrastructure Capacity	72
3:6:3	"Tourism Saturation"	72
	Successful Airlines	73
4	Airline Business and Marketing Strategies	74
4:1	Porter's "Five Forces" and their Application to the Airline Industry	74
4:1:1	Rivalry amongst Existing Firms	74
4:1:2	Substitution	75
4:1:3	New Entry	76
4:1:4	Power of Customers	78
4:1:5	Power of Suppliers	81
4:1:6	"Disintermediation"	83
4:2	Strategic Families	84
4:2:1	Cost Leadership, Differentiation and Focus--The Principles	84
4:2:2	Cost Leadership in the Airline Industry: Background	88
4:2:3	Fundamentals of the Business Model	89
4:2:4	Cost Leader Airlines: Current Issues	97
4:2:5	Cost Leader Airlines: The Future	99
4:2:6	"Differentiation" in the Airline Industry	102
4:2:7	Airline Alliances	107
4:3	"Differentiation" Airlines--The Future	113
4:3:1	The Concept of the "Legacy Airline"	113
4:3:2	"Legacy Airlines"--Strategic Options	118
4:4	"Focus" Strategies	125
4:4:1	Types of Focussing in the Airline Industry	125
4:4:2	"Value Added" Focussing	125
4:4:3	"Low Cost" Focussing	128
4:4:4	"Lost-in-the-Middle"	129
4:5	Airline Business and Marketing Strategies--Common Mistakes	130
4:5:1	Objectives	130
4:5:2	Diversification vs Specialisation	132
4:5:3	Pace of Expansion	133
4:5:4	Competitive Response	133
4:5:5	"Control"	134
4:5:6	Over-optimism/Fall Back Position	135
	Successful Airlines	135
5	Product Analysis in Airline Marketing	136
5:1	What is the "Product"?	136
5:2	The Theory of Product Analysis and its Application to the Airline Industry	136
5:2:1	The Product Life Cycle	136
5:2:2	Product Life Cycles in the Aviation Industry	141
5:2:3	Managing a Product Portfolio--the "Boston Box"	144
5:2:4	Balancing Risk and Opportunity--the Ansoff Matrix	149
5:3	Fleet and Schedules-Related Product Features	151
5:3:1	Cabin Configuration and Classes of Service	151
5:3:2	Network, Frequencies and Timings	154
5:3:3	Punctuality	158
5:4	Customer Service-Related Product Features	160
5:4:1	Point-of-Sale Service	160
5:4:2	Reservations and Overbooking	161
5:4:3	Airport Service	164
5:4:4	In-Flight Service	165
5:5	Controlling Product Quality	166
5:6	The Air Freight Product	168
5:6:1	Air Freight Capacity	168
	Successful Airlines	172
6	Pricing and Revenue Management	174
6:1	Building Blocks in Airline Pricing Policy	174
6:1:1	Pricing--A Part of the Marketing Mix	174
6:1:2	Deregulation	174
6:1:3	Dissemination of Fares Information	175
6:1:4	Revenue Management Systems	176
6:2	"Uniform" and "Differential" Pricing	177
6:2:1	The Principles	177
6:2:2	Management of Discount Fares	182
6:2:3	Pricing Response and Pricing Initiatives	185
6:3	The Structure of Air Freight Pricing	189
	Successful Airlines	192
7	Distributing the Product	194
7:1	Distribution Channel Strategies	194
7:1:1	Types of Distribution Channel	194
7:1:2	The Concept of "Super Profits"	196
7:2	The Travel Agency Distribution System	198
7:2:1	Advantages and Disadvantages	198
7:2:2	Today's Distribution Channels	201
7:2:3	The Future of Distribution	203
7:3	Global Distribution Systems (GDSs)	204
7:3:1	History and Background	204
7:3:2	Current Issues	207
7:4	Distribution Channels in the Air Freight Market	210
	Successful Airlines	212
8	Brands Management in Airline Marketing	213
8:1	"Brands" and "Commodities"	213
8:1:1	What is a "Brand"?	213
8:1:2	Why Brands?	216
8:2	Brand-Building in the Airline Industry	218
8:2:1	Foundations for Brand-Building	218
8:2:2	Positioning Brands	219
8:2:3	The Brand-Building Process	222
8:3	Brand Strategies	223
	Successful Airlines	227
9	Relationship Marketing	228
9:1	Fundamentals of Relationship Marketing	228
9:1:1	Some Definitions	228
9:1:2	Building Advocate Relationships	229
9:2	Components of a Relationship Marketing Strategy	231
9:2:1	The Management of Quality	232
9:2:2	Customer Relations	232
9:2:3	Marketing Communication	234
9:2:4	Loyalty Schemes	235
9:3	Frequent Flyer Programmes	235
9:3:1	History and Current Status	235
9:3:2	FFPs--Programme Member Requirements	236
9:3:3	FFPs--Airline Requirements	237
9:3:4	The Future	239
	Successful Airlines	242
10	Airline Selling, Advertising and Promotional Policies	243
10:1	The Anatomy of a Sale	243
10:1:1	The AIDA Model and the SPIN Cycle	243
10:2	Sales Planning	245
10:2:1	The Sales Budget	245
10:2:2	The "Communications Mix"	248
10:3	Marketing Communication Techniques	249
10:3:1	Sponsorship Policy	249
10:3:2	Database Marketing	251
10:3:3	Media Relations	259
10:3:4	The Field Sales Team	259
10:4	Airline Advertising	264
10:4:1	The Functions of Advertising	265
10:4:2	Advertising Decisions	266
10:4:3	What are the Features of "Good" Airline Advertising?	272
10:5	Selling in the Air Freight Market	273
10:5:1	The Sales Task in the Air Freight Market	273
10:5:2	Marketing Communication Methods	275
	Successful Airlines	275
11	The Future of Airline Marketing	277
	Glossary of Aviation Terms	281
	Glossary of Marketing Terms	293
	Index	303

Editorial Reviews

Examines principles of marketing applied to today's airline industry. Chapters include detailed discussions of product design and management, pricing and revenue management, distribution channels, and selling and advertising policies. Tells how marketing principles can be applied to maximize airline success, and gives a full range of practical relevant examples of successful and unsuccessful airline strategies from the global aviation industry. This fourth edition contains new chapters on brand and relationship marketing. Shaw is managing director of a firm specializing in providing courses in marketing and economics to airlines and aerospace firms. Annotation c. Book News, Inc., Portland, OR (booknews.com)

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