- April 10, 2020
Air France Internet Marketing Unit
AirFrance Internet Marketing
Discuss thetransformation of the travel industry by the internet.
The airline industry is highly volatile than most other industries.The sector has been subject to fluctuations caused by changes in themarket, economic fluctuations, and geopolitical developments.However, the internet has had the greatest influence on the industryso far. With the invention of the internet and increased access tothe same by the global population, players in the industry haveembraced this new platform as a marketing and sales and distributionchannel. Customers also acknowledge the convenience and securityfeatures of e-commerce. Hanke (2016) says that security of e-commerceas well as the attitudes and perception the platform has been thegreatest driver of the sector. As such, failures in the security ofe-commerce could spell doom for the entire e-commerce industry. Onthe contrary, the growth in security features of e-commerce hascontributed immensely to its growth.
Again the players in the industry have embraced the internet as asteady sale, marketing and distribution channel and also invested theright resources. The investments pertain to establishing websites andalso partnering with aggregate websites offering travel packagesinclusive of flight and vacation or holiday offers. Other websites donot provide direct sales but rather redirect consumers to the firms`websites where they can get access to additional information aboutthe company.
Furthermore, the development of search engines as marketing toolstransformed the airline industry. This new move allowed players totake advantage of the search engines in organizing information on theinternet in a strategic way that makes the brands of advertisers morevisible. Consequently, the search engine results allow firms to belinked with various keywords and phrases that they choose andcorrespond with their product offering. Pay-per-click options allowfirms to tracks traffic from other associated websites and thusidentify the efficiency of each marketing option over the internet.This tracking capability is absent in other marketing channels.Hence, the growth in internet use and e-commerce enables airlinefirms to assess return on advertising more accurately than in othermarketing options (Parnel 2013).
Why has consumeradoption of e-commerce for travel occurred so rapidly?
Internet use has increased phenomenally over the last two decades.The increased access to computers and other internet-enabled devicessuch as mobile phones and tablets have contributed to this increase.Manufacturers of these devices have also worked on the ease of useand better user interfaces of these devices allowing them to belinked for seamless connectivity. For instance, Google makes itpossible to access documents, contacts, and even internet searchhistory across many devices on one account.
According to Parnel (2013), rapid growth in internet access andimproved download speeds lead to more people spending more timeonline. High-speed internet connection has been growing impressivelyin the developed world and the US. For instance, there were about32.5 million households connected to the high-speed internet in theUS in 2005. This number had increased to over a 100 millionhouseholds with access to a broadband connection (Hanke 2016). Withthe growing number of internet users, the cost of connectivity hasalso decreased considerably. The advent of the social media hasincreased consumer presence on the internet that also spills over toother activities such as information searching and online shopping.Marketers are aware of this and have increased their presence in thesocial media too.
Another major factorthat contributed to rapid consumer adoption of e-commerce is theperceived safety of the online transaction. This is prevalent in allthe leading industries where many payment options such as PayPal,MasterCard, and Visa are acceptable payment modes. Again, theintangible nature of air travel products is better suited toe-commerce compared to tangible products where customers mayexperience the urge to feel the product physically before purchase.
From the case,should Media Contacts recommend a uniform strategy for Air Franceacross search engine publishers? Or would it be more effective totailor each publisher strategy to maximize return on investment?
From the case, it is evident that different search engines utilizethe same principles in their functioning, though there are slightdifferences. What this means for Air France is that these slightdifferences should be respected while at the same time keeping adegree of consistency based on the principle of search engines sameas the advertising message (Doganis 2009). There is a need torecognize that different search engines attract various types ofusers and search results may be influenced by geographic locationdepending on the search engine settings.
Furthermore, the pivot table reveals that each search engine has itsunique advantages that should be protected. Therefore, to utilize SEMoptimally, all the search engines should be used and each advertstrategically developed in a manner that capitalizes on the strengthsof the search engine (Chaffey & Smith 2013).
How should futureSEM campaigns be structured? In the past, Media Contacts hadconcentrated on Google, Microsoft, and Yahoo was there now anopportunity to optimize search advertising with meta-search companiessuch as Kayak?
Marketers prefer paid placements because they are cheaper than theSEO and it is even easier to track return on investments based oncost-per-click than just visibility based on search engine rankings. The presence of meta-search engines such as Kayak tends to remove theuniqueness of individual search engines given that they aggregatesearches from all engines and thus they should require a uniformstrategy. However, the meta-search companies such as Kayak are stillyoung and not as popular as the traditional search engines suchGoogle and Yahoo. Again, in using meta-search companies, users cannotaccess advanced search interfaces available in specific searchengines. Thus, it is highly recommended that Air France should stickto developing SEM campaigns structured to meet the specific needs ofindividual search engines as they have different features andadvanced search options.
Discuss whyproduct frills rarely produces long-term gains in market shares.
Product frills are easily matched by competitors and hence produce nolong-term gains in market shares. In short, frills can be a source ofsustainable competitive advantage and increase costs that is passedto consumers (Baker 2013). To attain long term market gains, airlinesneed to develop unique strategies products and services that cannotbe easily duplicated by competition. For instance, they could involvenew fleet or new flight routes. In both examples, there is a longterm process involved before airlines get approved to fly a new routeor even obtain a new fleet (Doganis 2009). On the contrary,introducing new frills such as free onboard Wi-Fi connection can beeasily emulated by competitors.
How can anefficient database cause overbooking and reservation problems for anairline?
Overbooking by airlines is commonly done intentionally. Efficientdatabases are allowed to overbook flight in order to increase seatutilization. This is because when a flight is fully booked, there arechances that not everyone will show up. Therefore, overbooking allowsairlines to cover the risk of a missed an absent passenger. However,overbooking creates problems when flight disruptions occur. This canbe due to technical hitches or weather patterns. In the modern age ofclimate change, flight delays due to bad weather are increasinglycommon. The overbooking may also create problems when airlines cannotmanage to get people to voluntarily choose to fly another laterflight at a given compensation. This is likely to occur due theholiday seasons.
Discuss how fleetand schedule-related product features differ between low-cost carriesand legacy airlines.
The low-cost carrier (LCC) model can be just described as featuringno-frills passenger service within a point-to-point network of shortand medium-haul routes that operate in secondary airports. In mostcases, they use a highly productive homogenous fleet. The schedulerelated features are important in all markets but are considerablymore significant in LCC. This is because these LCC`s operate in shorthauls and they serve to feed the other main airports and clientsseeking to connect to long-haul routes. Schedule-related features arealso relatively rigid and cannot be made flexible in some cases dueto market constraints. On the contrary, legacy airlines tend toattach relatively little significance to schedule-related features.However, these flights are usually long-haul making the frills morerelevant to customers. Again, partnerships and agreements with otherairlines and teams make it more difficult for legacy airlines toalter their schedules than LLCs. Again, schedule-related features inLLC are constrained by aircraft configurations given that theyoperate homogenous fleet as opposed to legacy airlines with adiversified fleet (Baker 2013).
Choose an airlineand then discuss each stage of the product life cycle. What stage ofthe PLC do you feel they are in? Why?
Delta Airlines is one of the largest air travel companies in the USwith a fleet of about 700 airplanes. This firm is squarely in itsmaturity stage of the product lifecycle. The company has perfectedthe art of product mix by offering both low cost and premiumservices. The firm has developed new ways of cutting costs byextending the life of its airplanes that helps drive the business.Again, the firm has not been involved in huge investments in the lastfew years as it would be expected of organizations in the growthstage. The firm has also been in operation for a relatively longperiod and has managed to control a huge market share. The firm isalso keen to grow its product portfolio to increase revenue streams.Since the firm is still profitable and its market share is stillrelatively high, the firm is not declining. To avoid decline, thefirms has responded well to change by incorporating change culture inits strategic position to accommodate and respond to fluctuations inthe market (Hayes 2014).
Part 2: e-Commerceand the Airlines Industry
Access theInternet and conduct a search of your favorite airlines. Searchthrough their website to discover their marketing partners. Describethe role these partners play in cross-marketing for these airlines.Do you feel their marketing efforts are effective? Why?
Some of my favorite airlines include Delta airline and EmiratesAirways. I have firsthand experienced of the services of theseairlines and I would recommend them to anyone keen on enjoying aunique flight to various destinations around the world. Delta haspartnered with English soccer club Chelsea FC (Delta Airlines 2016).Looking at the Emirates websites, it is indicated that the firmpartners with formula one, Real Madrid FC, Arsenal FC, Tennis greatsand other sports entities. The firm has also ventured into sponsoringarts and cultural activities around the world such as the SanFrancisco Symphony orchestra and the Dubai Jazz festival as well asthe Dubai camel derby. This allows the firm to attract consumers thatare loyal to these activities and the people who enjoy them. Thesemarketing attempts are highly effective in making the brand visibleglobally but also portraying the brand as an all-round corporateentity interested in enriching the lives of the people in many waysother than just the core product offering (Emirates 2016).
Baker, D. (2013).Service quality and customer satisfaction in the airline industry: a
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Chaffey, D. &Smith, P. (2013). E-marketing excellence. New York: Routledge.
Chernev, A. (2015).Strategic Marketing Management, 5th Edition. New York: Routledge.
Delta Airlines(2016). http://www.delta.com/
Doganis, R. (2009).Flying off course IV: airline economics and marketing. NewYork:
Emirates airlinesretrieved from http://www.emirates.com
Hayes, J. (2014).The theory and practice of change management. New York:Palgrave
Hanke, M. (2016).Airline e-commerce: log on. Take off. New York: Routledge.
Parnel, J. (2013).Strategic management: theory and practice. New York: SAGE.