Chapter 5: Case study e-Commerce in passenger air transport E-Commerce ©David Whiteley/McGraw-Hill, 2000

Airline booking systems Developed in the late 1970s by some large airlines. Notable examples are: United Apollo American Airways Sabre Initially a competitive weapon for the owning airline. Latterly developed as ‘unbiased markets’ to sell seats for any airline. E-Commerce ©David Whiteley/McGraw-Hill, 2000

Airline booking systems Currently three major e-Market airline booking systems: Sabre Galileo Amadeus E-Commerce ©David Whiteley/McGraw-Hill, 2000

Sabre Sabre (American Airlines): Started in the early 1960s Installed first terminal in a travel agency in 1976 Provides web based access via travelocity.com At the time of writing Sabre: Is processing over 400 million bookings a year for over 440 airlines (about 40% of the world market); Is linked to more than 210,000 terminals; Uses 30 mainframe computers (US based); Has peak processing exceeding 7,450 messages/second. Checkout www.sabre.com E-Commerce ©David Whiteley/McGraw-Hill, 2000

Galileo Galileo (United + European Partners): Started in 1971 At the time of writing Galileo: Is processing over 250 million bookings a year; For over 530 airlines (about 30% of the world market); Is linked to about 160,500 terminals; Uses 21 mainframe computers (US + UK); Has peak processing of about 5,000 messages/second. Checkout www.galilieo.com E-Commerce ©David Whiteley/McGraw-Hill, 2000

Amadeus Amadeus (Four European Partners): Founded in 1987 Continental joined in 1995 At the time of writing Amadeus: Is processing for over 469 airlines; Is linked to more than 190,000 terminals; Is based in Germany. Checkout www.amadeus.net E-Commerce ©David Whiteley/McGraw-Hill, 2000

Competition and customer loyalty Airline branding/customer loyalty: Advertisement: United ‘the friendly skies’ BA ‘the world’s favourite airline’ Hub operations/connections Loyalty/frequent flyer programs Alliances: Star Alliance/Our World Competition: De-regulation Low cost/no frills carriers E-Commerce ©David Whiteley/McGraw-Hill, 2000

Web booking systems The web provides: A new sales channel Less opportunity for price comparison Chance to develop brand loyalty Value-added features can include: Customer’s Frequent Flyers account online Pre-allocation of seats Online selection of meal options Additional travel services Travel and airport information Access to seat sales/auctions Personalisation of the web site E-Commerce ©David Whiteley/McGraw-Hill, 2000

With online booking (%) Web booking systems Analysis of airline web sites usage (1999) With web site (%) With online booking (%) North America 58 22 South America 33 8 Western Europe 42 12 Eastern Europe 7 1 Pacific 44 9 Asia 23 3 Africa 26 Average 10 E-Commerce ©David Whiteley/McGraw-Hill, 2000

Airline Web sites Customer Information: Alternatives: Requirement for prior registration Take details when purchase is made Prior registration: Can annoy/put-off customers Might tie customer into site Details at time of purchase: Time-consuming (if done every time) Sales can be mixed mode: Web enquiry / telephone sales Discuss / Check out some Airline sites E-Commerce ©David Whiteley/McGraw-Hill, 2000

Airline Web sites Product (flight) Information: Alternatives: Show Timetables Take date, time and airport details Issues: Knowing airport names / codes Several airports for one city Alternative dates and times Check out some Airline sites for cheap deals: London to New York: Several airports for each city Cheaper tickets may be available on alternative dates … and discuss issues. E-Commerce ©David Whiteley/McGraw-Hill, 2000

Airline Web sites Payment and Delivery: Payment by Credit Card: Security Issues Delivery: By post Collect at airport e-Ticket Discuss issues …. E-Commerce ©David Whiteley/McGraw-Hill, 2000

Options for booking airline seats Main options: Telephone airline direct Conventional Travel agent Online Travel Agent Airline web site E-Commerce ©David Whiteley/McGraw-Hill, 2000

Chapter 5 – Exercise 1 Check out booking of airline seats online – the requirement is for the best price for London to San Francisco – out 23 Dec and back 02 Jan. The following sequence of steps is recommended: Use the web to find out a list of carriers that fly the required route. Use two or three airlines to find the cheapest available return flight. Find an online travel agent and check for the cheapest price there. E-Commerce ©David Whiteley/McGraw-Hill, 2000