Airline Commercial Management Course
COURSE OUTLINE – AIRLINE MANAGEMENT – COMMERCIAL SECTION
This is a mid-level course which broadly
covers all the commercial aspects of passenger airline management, and in
particular focuses on the strategic and tactical marketing plans. It will
discuss the important aspects of the airline marketing mix.
Since the primary objective is to meet
customer needs, we start by examining the needs of the airline passenger, and
looking at how these are changing. We will explore segmentation in the airline
passenger market, and see what product variables can affect the attractiveness
of an airline’s offerings.
In this section we look at external
factors that need to be considered when setting your strategy, including factors
from the economy, politics, and social environment. Competition and alliances
What are the strategic options for an
airline, and what factors influence the choices. This module will consider a
number of real life case studies.
The primary purpose of an airline is to
move people and goods from place to place, and in the network planning function
we discover how to analyse different destinations and decide on which ones to
include in the route network.
Armed with the knowledge of customer
needs and the layout of the network, managers can now set about the task of
choosing which aircraft should be used to operate the network at maximum
The airline product consists mainly of
the seat, and the added values that are offered in addition. We will look at the
product mix that is needed to cater for the different customer segments.
In network planning we looked at WHERE
to fly, and in the scheduling module we will examine WHEN to fly. The airline
schedule is of paramount importance in attracting the right customers, and also
determines the productivity of our aircraft.
The influence of price in the airline
industry today is crucial, and constantly in review. We will learn how to set
price levels, and how to manage price in a dynamic marketplace.
In a nutshell, yield is a measure of the
total amount of money we collect on a flight. It is made up of the fare that
each individual passenger has paid for the journey. Effective management of
yield is a key success factor for airlines, and is a highly scientific activity.
It is about constantly trying to assess the maximum fare that can be charged for
the next available seat on a flight, without losing the customer.
Airline tickets are sold through a
variety of channels, mostly electronic. The distribution function has to manage
where the airline offers its seats, and how much it pays to the channel partner
Advertising and Promotion
The promotional function in an airline
follows the same disciplines as most other service industries, and aims to
create awareness and the desire to purchase the product.
Most airlines incorporate loyalty
schemes, which in essence reward passengers with points per flight which they
can later use to obtain extra flights at no additional cost.
Measurement and monitoring
To successfully manage an airline
profitably, the right measures must be monitored to evaluate performance, and
take corrective action where necessary.
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