CHAPTER 2: THE MARKET FOR AIR TRANSPORT SERVICES What Business Are We In? TRANSPORTATION COMMUNICATION LEISURE LOGISTIC INFORMATION SELLING SERVICES

Do you think transportation is important for social need and why? What kind of transportation we have now?

THE MARKET FOR AIR TRANSPORT SERVICES What Business Are We In? Transportation Long haul Short haul Door 2 door Special service etc

CHAPTER 2: THE MARKET FOR AIR TRANSPORT SERVICES What Business Are We In? TRANSPORTATION COMMUNICATION LEISURE LOGISTIC INFORMATION SELLING SERVICES

Example of communication we have now? Telephone, Internet, Video conference etc

THE MARKET FOR AIR TRANSPORT SERVICES What Business Are We In? b) Communication - face to face meeting urgent business deal day trip Business Competitor?

CHAPTER 2: THE MARKET FOR AIR TRANSPORT SERVICES What Business Are We In? TRANSPORTATION COMMUNICATION LEISURE LOGISTIC INFORMATION SELLING SERVICES

THE MARKET FOR AIR TRANSPORT SERVICES customers disposable income What Business Are We In? c) Leisure & holiday customers disposable income disposable time leisure holidays Leisure activities

CHAPTER 2: THE MARKET FOR AIR TRANSPORT SERVICES What Business Are We In? TRANSPORTATION COMMUNICATION LEISURE LOGISTIC INFORMATION SELLING SERVICES

- fast transportation of goods - meeting dateline any ideas…. THE MARKET FOR AIR TRANSPORT SERVICES What Business Are We In? d) Logistics Air freight - fast transportation of goods - meeting dateline any ideas….

CHAPTER 2: THE MARKET FOR AIR TRANSPORT SERVICES What Business Are We In? TRANSPORTATION COMMUNICATION LEISURE LOGISTIC INFORMATION SELLING SERVICES

THE MARKET FOR AIR TRANSPORT SERVICES What Business Are We In? e) Information - moving urgent documents - transportation of news Docs, items, samples, products

CHAPTER 2: THE MARKET FOR AIR TRANSPORT SERVICES What Business Are We In? TRANSPORTATION COMMUNICATION LEISURE LOGISTIC INFORMATION SELLING SERVICES

THE MARKET FOR AIR TRANSPORT SERVICES What Business Are We In? f) Selling services Ground Handling Airport Management

THE MARKET FOR AIR TRANSPORT SERVICES What Business Are We In? f) Selling services Catering In-flight Entertainment

THE MARKET FOR AIR TRANSPORT SERVICES What Business Are We In? f) Selling services Piloting Engineering

THE MARKET FOR AIR TRANSPORT SERVICES What Business Are We In? f) Selling services Cabin services Reservation/ticketing

THE MARKET FOR AIR TRANSPORT SERVICES What Business Are We In? f) Selling services Dubai airport Duty Free Shops

Chapter 2:The Market of Air Transport Services Who Are The Consumer and Customers? Market Segmentation?

Who Are The Consumer and Customers?

THE AIRLINE CUSTOMERS The Consumers --- “ARE THOSE PEOPLE WHO ACTUALLY TRAVEL” The Customers --- “They Are The Decision Makers”

CHAPTER 2: 4 CUSTOMER DECISION WHICH MUST BE ANALYSED Will a trip be made at all? Cost of travel Firm try reduce expenditure to increase profit What mode of transport will be selected? Railway, bus? Airplane? For air trips, what class of service will be purchased? First class Business class Which airline will be selected? MAS? Air Asia Firefly?

CHAPTER 2: UNDERSTAND THE AIRLINE MARKET The general customer need Industrial buying behavior The customers in the “business air travel market” Leisure & Holiday Travel Market Customers - Air Freight Market

CHAPTER 2: The General Customers Needs Flight frequency; to allow travel flexibility Roomy cabin: to permit working during flight Personal benefits; incentives, frequent flyer program Pride & ego: special reservation, check in (red carpet), cabin, etc Lazy to change: stick to existing supplier CHAPTER 2: The General Customers Needs

UNDERSTANDING THE AIRLINE MARKET The General Customers Needs

The General Customers Needs

The General Customers Needs

The General Customers Needs

CHAPTER 2: UNDERSTAND THE AIRLINE MARKET The general customer need Industrial buying behavior The customers in the “business air travel market” Leisure & Holiday Travel Market Customers - Air Freight Market

CHAPTER 2: UNDERSTAND AIRLINE MARKETING 2.Industrial Buying Behavior – DMU(decision Making Unit) Decider Gatekeeper User Buyer Influencer

Industrial Buying Behavior – DMU (decision Making Unit) Decider - he makes the final decision: owner, CEO, Senior Manager, Gatekeeper – those people who control the flow of information into decision-unit. e.g.: PA protect their Boss from times wasting visit, unwelcome sales people. User – those people who use the product or service, concern about quality , cost Buyer – negotiate to get the best deal, expect reward from savings Influencer – those people who don’t use a product, but who influence the final outcome-e. g: government, civil, -Please read page:12-14

CHAPTER 2: UNDERSTAND THE AIRLINE MARKET The general customer need Industrial buying behavior The customers in the “business air travel market” Leisure & Holiday Travel Market Customers - Air Freight Market

CHAPTER 2: UNDERSTAND THE AIRLINE MARKETING 3. The Customers in the “Business Air Travel Market” Secretaries who makes bookings for their bosses – understand the bosses requirements, Travel agents – 80% of bookings, Corporate Travel Manager – special task Customers – who provide feedback Please read page 15-17

CHAPTER 2: UNDERSTAND THE AIRLINE MARKET The general customer need Industrial buying behavior The customers in the “business air travel market” Leisure & Holiday Travel Market Customers - Air Freight Market

CHAPTER 2: UNDERSTAND THE AIRLINE MARKETING 4. Leisure & Holiday Travel Market A) Their Concerned ~Is there other/better mode of travel ~Service and quality Challenges from surface & ground transport B) Children – facilities for children & babies ~women – UK, well plan program C) Travel agent ~ provide package, visa etc D) Tour operators ~ organizes travel in groups E) Consolidators ~bucket shops, block seats to sell on discount

CHAPTER 2: UNDERSTAND THE AIRLINE MARKET The general customer need Industrial buying behavior The customers in the “business air travel market” Leisure & Holiday Travel Market Customers - Air Freight Market

CHAPTER 2: UNDERSTAND THE AIRLINE MARKETING 5. Customers - Air Freight Market The Freight Forwarders – 90% of business b) The Senior Management of Freight Forwarders – decides on the airlines carrier The forwarder’s clerks-decides on the emergency shipment and at late night The integrator-a complete-services, door to door, FedEx, ups

What are the different between LCC compare with the other commercial Airlines??

Exercise!! What is the Low cost carrier? What is characteristic? What LCC do and DO not do?

CHAPTER 2: MARKET SEGMENTATION Definition 1: ~~A market segment is a subgroup of people or organizations sharing one or more characteristics that cause them to have similar product needs~~

CHAPTER 2: MARKET SEGMENTATION The Air Passenger Market Air Freight Market Selection of Airline

CHAPTER 2: MARKET SEGMENTATION The Air Passenger Market a) Journey Purpose - b)Length of Journey- c) Country/Culture of Origin of Traveler-

MARKET SEGMENTATION 1. The Air Passenger Market a) Journey Purpose - Pilgrim visits: Mecca, India, Malaysia - Corporate business travel; services is important - Independent business travel: cost factor is important

1. The Air Passenger Market - cont MARKET SEGMENTATION 1. The Air Passenger Market - cont a) Journey Purpose-cont - Leisure holiday: high disposable income to cover accommodation and meals - Leisure travel visiting relatives: lower disposable income

CHAPTER 2: MARKET SEGMENTATION The Air Passenger Market a) Journey Purpose - b)Length of Journey- c) Country/Culture of Origin of Traveler-

MARKET SEGMENTATION 1. The Air Passenger Market - cont b) Length of Journey - Short-haul-route: flight time less than an hour, airport location and service, frequency and timing seats accessibility/ticket flexibility

MARKET SEGMENTATION 1. The Air Passenger Market - cont b) Length of Journey -Long-haul-route: flight time more than an hour, in-flight experience and service, seating comfort, food,

CHAPTER 2: MARKET SEGMENTATION The Air Passenger Market a) Journey Purpose - b)Length of Journey- c) Country/Culture of Origin of Traveler-

1. The Air Passenger Market - Country/Culture of Origin of Traveler MARKET SEGMENTATION 1. The Air Passenger Market - Country/Culture of Origin of Traveler - seating comfort, European vs. Eastern traveler - food for Muslim and non-Muslim

CHAPTER 2: MARKET SEGMENTATION The Air Passenger Market Air Freight Market Selection of Airline

MARKET SEGMENTATION 2. Air Freight Market Emergency traffic: - fast delivery of goods, door-to-door - operating emergency; emergency parts for oil company or ship spare parts - marketing emergency; suppliers meeting deadline, to service dissatisfied customers Perishability: good with short life span By Type of Services – 1st class/Buss Class - Corporate policy - Decision makers - Advantages & services

CHAPTER 2: MARKET SEGMENTATION The Air Passenger Market Air Freight Market Selection of Airline

MARKET SEGMENTATION 3. Selection of Airline a) Business Traveler – corporate policy b) Leisure traveler – tour operators

Summary chapter 2: ~~The market for air transport services.~~ ~~Consumer and customer definition~~ ~~ Understand the airline market~~ ~~ Market segmentation~~

EXERCISE!!!! Please explain the 2 market of air transport services and give your own example. Please state 3 ways how can you improve the market of air transport service? An airline has implemented the type of service which 1st, economic and buss class. As the customer, which one you prefer and explain why. Please explain the definition of Consumer and Customer. As a customer, what are your general needs which an airline need to pay attention? As the airline industry operator, you must know the air passenger Market. Please explain 3 kind of the air passenger market.