- point-of-sale service
- reservations and overbooking
- airport service
- inflight service
Find the Important rules & regulation of aviation industry . various process in aviation industry related to passenger & cargo.
Friday, 27 July 2012
customer service – related product features
fleet and schedules – related product features
- cabin configuration
- network, frequency and timings
- puncuality
focus strategies
two types of forecasting
- value added forecasting
- low cost forecasting
- lost- in the middle
strategic families
cost leadership
fundamentals of business model
fundamentals of business model
- low fleet costs
- low landing fees
- short turn around
- limited on board service
- point-to-point only
- simple fares
- low distribution costs
- non-refundable tickets
Porters Five Forces
- rivalry among existing firms
- subsitution
- new entry
- power of supplier
- power of customers
PESTE analysis
political factors:
- terrorism
- open skies and deregulation
- marketing policies
- privatization
- state aid
- airport slot allocation
- economical growth and the trade cycle
- the ageing population
- changing family structure
- changing culture
- deregulated lab-our market
- female business traveler
- video-conferencing
- internet
- surface transport investment
- climate change
- shortage of infrastructure
- tourism selectoion
customer requirements
- frequency and timings
- punctuality
- airport location and access
- seat feasibility
- ffp
- airport service
- in-flight service
segmentation variables in the air passenger market
1. journey purpose
2. length of journey
3. country/culture of origin of traveller
2. length of journey
3. country/culture of origin of traveller
who is the customer
- will a trip be made at all?
- what mode of transport will be selected?
- what class of travel?
- what airline will be selected?
stages in the application of Marketing Principles of Airline Management
- the customer
- the marketing environment
- strategy formation
- product design
- pricing and revenue management
- distribution channel
- selling, advertising and promotional activities
Thursday, 26 July 2012
A.D.Littles Life-cycle approach to strategic planning
- assessing suitability
- life cycle analysis
- positioning
cash cow implication
- discounted cash flow analysis
- benefit cost ratios
- sensitivity analysis
- financial analysis
- shareholder value analysis
- analyzing risk
- verification activities
- exit criteria
experience curve
benefits:
labour efficiency
standardization, specialization and methods improvements
technology driven learning
better use of equipment
change in resource mix
product redesign
value chain effects
network building
shared experience
labour efficiency
standardization, specialization and methods improvements
technology driven learning
better use of equipment
change in resource mix
product redesign
value chain effects
network building
shared experience
Strategy Formation Generic strategies
- cost leadership strategy
- differentiation
- focus and niche strategies
scenario planning
five steps
step 1:identify and analyze the organizational issues that will provide the decision focus
step 2:specify the key decision factors
step 3:identify and analyze the key environmental factors
step 4:establish the scenario logic's
step 5:select and elaborate the scenario
step 6: interpret the scenario for their decision making
step 1:identify and analyze the organizational issues that will provide the decision focus
step 2:specify the key decision factors
step 3:identify and analyze the key environmental factors
step 4:establish the scenario logic's
step 5:select and elaborate the scenario
step 6: interpret the scenario for their decision making
swot analysis
- analysis of firm against competition
- swot matrix
- pestle analysis
- case analysis
- analyzing a case
- historical and swot analysis
- analyze the organizational history
- examine internal environment
- examine external environment
- analysis of strategies
- analyze corporate level strategy
- debate the merits
- analyze business level strategy
- analyze structure and control systems
- recommendations and discussions
- make recommendations
- class discussions
critical success factors
- business and policy objectives
- implementation options
- prioritized change initiatives
- programs
- work streams
- policy outcomes and benefits from changed organisation
- identification
- key decisions
- information requirements
competitive & environment analysis
- competitiveness profiling
- perceptual mapping
- joint space analysis
- competitiveness profiling
- strategic group analysis
- five forces model
- threat of new entrant
- bargaining power of supplier
- bargaining power of buyer
- existence of substitute products
- intensity of rivalry
- getting information
hierarchical level of planning
- setting of objectives
- balance your objectives
- multiplicity of objectives
- themes for objectives
- use result oriented objectives
- quantify your objectives
- network objectives
- make them Challenger but attainable
- SMART formula
Mission - Vision of the firm
- vision statements
- a basis for performance
- way to communicate
- mission statement
- preparation of vision and mission statements
- revision of mission statement
Sunday, 22 January 2012
Best Airport in the World the Case of Singapore Airport
Best Airport in the World’; the Case of Singapore Airport
Singapore is an excellent example of a quasi-city state with virtually no origin & destination (O&D) demand that has been able to acquire over the years a solid
Role for stopover traffic between Europe and Australia. Along the so-called ‘Kangaroo Route’.
Singapore Airlines is consistently considered the best airline in the world and the pace of passengers that are choosing Singapore as a stopover for their Asian flights has been constantly increasing for the last decade.
Singapore airport is famous throughout the world for its own unconventional and rather innovative package. Travelers’ may pass their time before boarding not only 1) shopping in the various arcades of the complex, but also 2) relaxing close to an artificial lake surrounded by orchids. Between a long list of 3) bars and pubs, it‘s also possible to have a drink while 4) listening to a violinist within an 5) environment of tropical palms and 6) reproductions of past civil airlines. Children may play their 7) favorite videogame in a dedicated area, while film lovers will find 8) a movie theatre and sport fans a sports arena. There is also a 9) fitness centre close to the Transit Hotel at Terminal 1, where you can also have a sauna or Jacuzzi.
For 100 aviation enthusiasts there is garden terrace with chairs, tables, umbrella and an excellent view of the runway and 11) no limits for shooting pictures. And when transit passengers have to wait for five hours before the next flight is going to depart, they have the chance of taking 12) a free city tour including a 13) boat trip on the river.
In 2000 Changi airport was awarded by IATA ‘Best Airport Worldwide’ in the category of more than 25 million passengers per year. More than 60% of the annual revenues of the airport come from the non-aviation related business.
A Best – in-Class Airport Enterprise; BAA and the Non-Aviation Business
A Best – in-Class Airport Enterprise; BAA and the Non-Aviation Business:
BAA is perhaps the world’s leading airport operator in terms of traffic volume and innovation, particularly in the development of retailing. It operates 7 airports in the UK and it is active also in the USA (Pittsburgh, Indianapolis being some notable examples) and in Australia
BAA’s non-aviation philosophy is ‘to put customers first and concentrate on their needs’. The company aims to create what it terms a ‘total retail environment’ the key components of this strategy including;
· Positive competition;
· Branded operations and wide product ranges;
· Fair pricing;
· Guaranteed value for money;
· High service levels;
· Continuous improvement and innovation.
BAA continuously maps customer satisfaction by means of technical tools, such as QSM. The QSM is a detailed survey of passengers, covering service standards and value for money. It is designed to track the airports’ overall performance and to highlight areas of weakness. Improvement and innovation are also helped by the structure of the airports’ retail departments – they are organized by function, with specialist product managers running individual retail sectors. Specific examples of innovations include;
· Retailing management contracts in which BAA pays a management fee to the retailers and retains all sales turnovers as revenue.
· Bonus points frequency-shopping card;
· A personal shopping service at Heathrow’s Terminal 4, just one example of the levels of service provided at BAA airports;
· A ‘theme’. Park’ at Gatwick, named ‘Gatwick and Aviation, past, present and Future’. The idea for a Gatwick attraction arose from the fact that the airports is already among the top five fee-paying attritions in the south – east of England.
Non Aviation-Related Value Proposition
The development of the Non Aviation-Related Value Proposition
Towards an Evolution of the ‘Traditional Airport’ Business Model
In the past, the airport business looked to be quite simple to manage. In the airports, the most important figure was traffic increase, either on the passenger or on the cargo side, to be matched with IATA average industry forecasts. In the short term, achieving this goal meant more revenues, in the form of increased passenger taxes as well as landing and handling fees from the core aviation- related business. In a longer-view perspective a wider level of activity would create a chance for the airport infrastructure to be ungraded.
Airports didn’t have to worry too much about controlling their own operating costs. Spatial upgrades to cope with primary demand increases were almost completely financed by the state or regional/local entities in the form of huge subsidies, with the aim of improving the effectiveness of the country’s overall infrastructural package.
New Evolutionary Patterns for Airport Enterprises
The traditional airport managerial approach had previously underestimated the relevance of a vast category of secondary activities within their own airport boundaries. These may, infract, play a significant role in complementing and supporting the primary service of the airport infrastructure and become a major source of airport revenue.
A proactive and visionary airport management may gain a significant degree of entrepreneurial freedom when aiming to increase its overall revenue and profits by focusing on its non-aviation business side.
The ‘Commercial ‘Airport’ exhibits critical differences both in its strategic mission and in its inherent marketing implementation, when compared to the ‘Traditional Airport’ concept.
This new market formula sees airport infrastructure evolving from pure mono or multimodal logistical medium into more sophisticated market entities that may be described as a ‘multipoint service-provider firms’
Thus apart from its conservative, traditional air-side business, airports also tend to become commercial hubs, in which a bundle of diversified service proposition and products are offered to an enlarged of target customers. This new set of potential customers includes not only a) air passengers and b) air transportation employees, but also c) local-communities d) residents, e) firms and f) firms’ employees operating inside the airport’s catchment area, g) tourists and aviation enthusiasts.
The enriched service package offered by a modern airport enterprise
The recent increase in competition between airports in the aviation-related business, especially when dealing with primary hubs, plays an important role in the development of the ‘Commercial Airport’. According to this approach, five new areas of activity may be identified, as a complement of the traditional core business, when dealing with the ‘Commercial Airport’ approach.
i) Commercial service;
ii) Tourist services;
iii) Conference services;
iv) Logistic and property management services;
v) Consulting services’
Commercial services (Airport Retailing)
In this broad micro-category, practitioners usually include all airport retailing activities. These are the vast package of commercial ventures offering products and services aimed at satisfying customer needs, mainly impulse ones.
A) From as demand side, we may identify five major target-demand clusters for commercial services;
1. A basically captive audience, consisting of traditional; origin, destination and transit passengers; this cluster is mainly driven to shop for primary needs’ items or to purchase a gift for family or friends;
2. The so called ‘meters and greeters’. Coming to airports to accompany or pick-up Visiting Friends and relatives (VFR), travelers or job-related contacts. These could be attracted to send some of their own spare time at the airport shopping or eating;
3. An airport enterprise’s airlines’ and other service providers’ employees within the air transport value chain; they are typically purchasers of commercial services either for their work or private needs;
4. Local residents around the airport or close to it;
5. Companies within the airport’s catchment area; they are potentially a
target of B2B services in the logistic and property management.
B) From the offer side:
*Commercial services in a strict, which include those services that are closely linked to the more traditional and conservative airport-retailing offer. Major examples are provided by fashion boutiques, jewelers, tobacco retailers, newsstands, car rentals, money changes;
* Food and beverage services, like traditional restaurants, fast foods, bars and snack-bars;
* Complementary services, this category deals with services not historically included in an airport retailing mix and, thus, representing a major source of differentiation. For instance, ATMs religious services, local gourmet shops, miscellaneous corners, Internet cafes, pharmacies, florists, fitness and wellness centers, pharmacies, hairdressers, hotel and info points, merchandising kiosks;
* Advertising services, linked to the commercial exploitation of spaces within the terminal boundaries to promote sales of various products and brands.
Aiming to maximize profit generation by means of royalties, airport enterprises will have to place each concessionaire in the right location to facilitate the offer demand matching in a consistent way.
Los Angeles into airport: encounters, pub restaurant dashy corporation
London Gatwick venue 10% Donald garfuabel Hair dressers- Vienna into airport
Ideal placement of outlets and services within a terminal: airside vs. landside areas
Departure hall Landside | Departure hall Airside | Arrival hall |
Gourmet shop | Duty-free shops | Pharmacy |
Bars/restaurants/foods Court | Bars/restaurants | Bars/restaurants |
hairdresser | Last minute duty-free shop | Info point |
Thematic shops (related to the distinctive products of the catchment area) | Jeweler | Hotel point |
Fashion stories | Money changer | Bank |
News-stand | | Miscellaneous |
| | Florist |
| | Car rental |
Airport retailing, in fact, is just one of the many ingredients that can permit the ‘commercial airport’ business concept to succeed in the market. Non-aviation practices must now deal with all those forms of revenue generation that come from the exploitation of airport platforms for purposes not correlated with technical support of aircraft and passengers.
Tourist Services
The ‘airport as a tourism and leisure destination’ concept provides the need for creative marking strategies to attract additional influxes of demand, not just those who have airline tickets. In other world, airport-enterprises may also sell a new form of entertainment, capable of generating autonomous interest in a broad audience. Spotters and aviation have become ‘event organizer’s to stimulate complementary demand in daily or yearly off-peak periods. This goal has been achieved through radical innovation in the value proposition. Frankfurt airport opened a discotheque inside the Terminal building, this best-practice being rapidly benchmarked and imitated by Munich airport; too, Amsterdam Schiphol has launched a casino in the transit area, as have Frankfurt and Munich airports, while Milan Malpensa airport, has hosted music concerts inside the New Terminal 1 on an ad-hoc basis. Many airports have built golf courses inside or close to their boundaries, targeting this highly – affluent cluster. Dallas-Forth Worth and Auckland airports have a golf course just outside their boundaries and organize dedicated caddy transfers for golf lovers. But the best example comes from Thailand, where Bangkok airport hosts a golf course between its two operating runways!
Art exhibitions are being organized by many airports too not necessarily only primary hubs.
Conference Services
Other areas of market interest for commercially – minded airports may arise from the conference market. This potentially high-yield cluster is looking for the availability of large and spacious areas in which to host delegates and plan meetings with the support of state-of-the –art technological devices, throughout the year.
Developing congressional facilities can be implemented by means of three different approaches;
1. In-terminal facilities directly managed by the airport enterprise itself.
2. In-terminal facilities outsourced and then managed by a concessionaire. General London with Rome
3. Partnership with hotel chain. Which can be implemented through the building of hotels within or close to airport boundaries? – Paris
Logistics Services and Property Management:
Historically, airports have played a modest role as partners to their related industries. In other words, the airport infrastructure has not been deeply integrated in firms’ logistic chains, but simply used as an ‘external’ medium as well as transfer point for goods, with a role of facilitating material contacts between the spokes of the chain itself.
Today, however, on the basis of significant experiences, mainly in the maritime industry, even airport enterprises are starting to develop an enriched cargo portfolio offer for firms in their own catchment area.
Another possibility is lending spare space in airport cargo facilities to host fairs and exhibitions, especially technical ones. In this case, a magnitude of synergies can be exploited with both the conference business, and also hotel chains.
The airport enterprise, can also promote the renting of all spares – either built or planned – that are located within its own boundaries. This activity is referred to as property management; Opportunities for sound economic exploitations of the property management business also exist in the case of regional airports. However, airports will have to face stiffer competition from both companies who specialized in temporary rents, as well as from hotels.
Consulting Services
Best-in-class airport operators may, eventually, implement another form of upgrade of their service package offered to the market. On the one hand, the consoling approach is consistent with the technical activities of project engineering and financial management; on the other hand, the consulting activity will mainly deal with the implementation of management contracts. In this case,. The most innovative component of the ‘commercial airport’ format will be exported.
Airport Alliance
Airport Alliance
Since the 1980s, one of the most fashionable tools to reinforce firm’s market presence has been through alliance paths within industry boundaries (horizontal alliances or by including companies from related sectors, as in the case of value chain or cross- industry alliances.
· Implemented in equity-based or non-equity contractual agreements, Alliance may assure partners a bundle of competitive and commercial opportunities. Through alliance a number of strategic and operational goals can be achieved much faster than in the case of a purely internal approach.
Benefits that alliances have proven to create for the partners involved are:
· A dramatic cut in both the scope of financial support needed and in the level of risk compared to a stand-alone situation;
· A mutual sharing of operational and marketing costs associated with the business venture;
· A chance to enter or have better coverage of some value-adding markets and demand clusters, especially in the case of tight regulatory regimes that limit the sharing of capacity 9as is the case in the air transport industry),
· The evolution of the behavioral patterns of the industry, from a publicly-regulated monopoly or oligopoly to a players-driven industry. In this case, some acceptable forms of trust may enable players to achieve higher returns on investments (higher incomes and lower costs) that are, once again, a consequence of lower levels of competitive intensity.
In the aviation world, some Bilateral agreements between Airlines, can be traced back to the 1960s which took the form of Interline and Pro-rata agreements under the IATA umbrella.The Main types of airport partnerships
Three categories:
1. Point-to-Point Alliances
2. Multi-Point Alliances
3. Management Contact Alliances
1. Point-to-Point Alliances
The origin of this partnership, which can be either non-equity or equity-based, lies in cooperation practices between a pair of airports, not necessarily located in the same or close markets.
· Partnership may involve a bundle of managerial issues, from jointly handling production to joint purchases of airport retailing goods or below-the-line operational support of airport practices.
· A temporary transfer of managers, employees or machines to the partners, the broader the partnership, the greater the number of functions and departments that tend to be involved.
· When the cooperation becomes tight, a natural step is the transformation of it from a purely contractual one to an equity-based formula or a full merger of airport enterprises.
2. Multi-point Alliances
The multi-point co-evolutionary view involves a significant stretching of the dimensional boundaries of the alliance
A panel of airport operators to sign a cooperation agreement, which can be equity based or non-equity based, to include expertise sharing on some functions or on the whole package of operations. Airports will be able to choose a single brand, like in the case of the trilateral alliance branded as Partners, or maintain a stand-alone positioning.
The strategic goal of this multi-point agreement lies not only in the dimensions of critical mass which can be used in negotiations, but also in the stronger lobbying power that partners may put into practice when relating with some supranational ‘met regulators’
3. Management Contract
A final form of partnership for the airport business deals with the so called ‘management contract’. Here no ownership clauses are involved and the agreement usually occurs between a government and a private subject.
The contractor takes responsibility for the day-to-day operation of the airport and agrees to pay an annual management fee, usually related to the performance of the airport. The overall economic risk will be shared between the owner and the management company. For the Government owner this may be politically more acceptable, whereas for the contractor such an arrangement may be attractive in countries where greater financial exposure may be seen as too great a risk.
This kind of agreement may, thus be beneficial for both parties. On a short-term view, the government will see the economic potential of its airports maximized, thanks to the competences of the contractor.
In a longer-term perspective, the government involved will also be able to improve the local knowledge of airport management in its own infrastructures, with a chance of cross-cultural fertilization of management practices by the contractor and, eventually, a possible return to a stand-alone perspective. Airport Revenue Management
Airport Revenue Management
In the air transportation business, revenue management has been mostly associated with hyper discrimination of pricing tariffs made by airlines initially and can rental companies, and to hotel chains recently.
· This kind of Demand-oriented pricing approach may be extended to other Airport value chair members as well.
· Price Discrimination to be applied for airport lounges, parking, handling and landing fees.
· Rigid capacity levels, at least in the short-to-medium term
· Significant load factors fluctuations within the timing unit considered to be a day, week, month or an IATA season.
· The achievement of higher load factors during off-peak periods through the use of highly appealing discounted fares as a form of Market Stimulation.
· Airport parking – lower levels of space occupation are usual at nights or weekends.
· Discounted fees in a tour package offered to leisure travelers, with different levels of promotional capacity in the case of peak or off-peak seasons.
Price stimulation could create an ancillary package to support the Non-Aviation Business of an Airport Enterprise.
· In-terminal supermarket, by granting the first hour of parking for free. Geneva Mode _This model for other business too.
Joint promotion activities to attract new customers at the airport’s restaurants and food courts.
· Airport lounges-common practice for airlines to pay a standard fee for every passenger entering an airport’s lounge.
Airport lounge operator could exploit the revenue management tool to attract extra traffic during off-peak periods, eventually extending to clusters of passengers the chance to rest at the lunge besides solely relying on business travelers.
· Revenue management could also be applied to Ramp and Ground Handling services.
Ground operation- some spare discounted police aimed at attracting point-to-point carriers during off-peak times,
· Introduce a rise in price during rush hours to improve the overall hub efficiency.
· This kind of approach to be extended to landing fees and ATC services also.
Low-Cost Airports
Low-Cost Airports: A Possible Evolutionary path for Airport Enterprises?
In the air transport environment, the term ‘low-cost’ is typically related to a specific value proposition in the airline business.
Low-cost carriers do not offer free-of-charge catering or different service classes, but some of them give rewards to their frequent-fliers,. But they have to maintain some fundamental peripherals, like ground handling services and minimum seating pitches. The consequence of this limited service offering is a partial cost saving transfer to customers by means of highly competitive and aggressive fares.
Projected changes in intra-European passenger market shares, 2000-2010
Low cost airlines 5% - 25 %
Charter airlines 20% - 15%
Network carriers 75% - 60%
Emergence of Low Cost Airports
Low – Cost Carriers achieve economics through Airport services:
1. Use uncongested airports far from the cities
2. A small number of check –in –desks Longer check-in-times
3. Passengers to arrive at airports well in advance of the departure time
4. No special lounges provided
All these measures result in significant cost savings
Strategic answer to the market upsurge of LCC’s
Emergence of new kind of Airport positioning: The Low-Cost Airports highly specialized market interface designed to satisfy the operational needs of LCCs
Example: London Luton, Brussels Charleroi – where LCC dominate total airline movements.
LCCs are aggressive in B2B negotiations:
LCC look for economic subsides with Airports for the followings:
1. Start up costs
2. Cheaper handling
3. Landing and parking fees
4. Efficiency in ground operations leading to short turnaround times
In order to accomplice the demands of LCC, Low Cost Airport requires,
Ø Significant reduction in the complexity of all organizational levels-streamlining of hierarchies and functional responsibilities
Ø Improvement in staff flexibility in the ground operations area
Ø A greater use of part-time workers at peak –time periods to improve the effectiveness of service to airlines.
Ø Self – ticketing and self check –in kiosks.
Ø Constant supervision by ground staff
Ø Kiosks, end customer satisfaction tool, giving customized information to the passenger about the flight time, real time information to security staff about crowd levels so as move staff accordingly
Thus Airport transformation should lead customer airlines, to maintain sound productivity.
Finally, Low –cost airports may realize that an average LC passenger tends to spend less at airports than other passenger types, market research studies shows declining levels of average expenditure.
Hence Low-cost airports will thus have to focus
a) Their retailing offer on impulse goods, like miscellaneous corners, pharmacies, Internet cafes and fast food restaurants,
b) Avoiding fashion stores and jewelers that will be perceived as distant from the passenger’s low –cost ‘travel concept’.
The possible Role of Helicopters as a Complementary Feeder and Defeeder of Hub Airports
The First ‘Quantum Leap’ of the Airport Enterprise
The First ‘Quantum Leap’ of the Airport Enterprise
Industry practice shows that best-in-class players are moving away from classical’ mono-modal’ approaches. In fact, these actors are developing new strategic model based on co-evolutionary designs with other transportation solution. The path of co-operating with a competitor inside its own value proposition, either a direct one or another transport operator, seems effective, most definitely in those environments.
Airport enterprise abandon their ’splendid isolation’ with a country’s logistics package and provide the initial momentum for radical change, or a ‘Quantum Leap’, towards a multimodal hub approach. The Customer’s of multimodal hubs (either passengers or goods) are given the chance to seamlessly connect from air to ground, railway and sea ferry within airport boundaries. This intenerated and upgraded bundle on offer naturally improves the chances for airports to foster their market power, thanks to the combined use of airport infrastructure, high-speed trains and motorways. Example:
Charles de Gaulle airport in Paris, Frankfurt airport in Frankfurt and Schiphol -airport in Amsterdam. The adoption of an intermodal approach has given these sites not only the opportunity to expand their passenger-catchment areas, crossing regional or national borders, but also to increase the weight and number of business-to-business transactions.
identification of partners for airport development
marketing support system plan (MSSP formula)
typical recipient of the MSSP is represented by low cost carriers
the reasons are:
typical recipient of the MSSP is represented by low cost carriers
the reasons are:
- impact of low cost carrier in terms of the pax no
- low cost carrier have a positive economic impact on tourist
- a rapid increase in airport traffic
- low cost carrier stimulate intermodality
airline market positioning
- definition of level and content of the value proposition
- identification of the price level
- implementation of the communication campaign
- level of distribution of value proposition
Positioning strategy, and the five different alternatives
1. Primary Hub
The airport enterprise aims to operate as hub focusing on facilitating passengers and goods travelling on a transitional level. This goal will be best achieved by first attracting one or, possibly, a couple of airlines that will develop their main base of operations at the airport.
In this sense, strategies and performance of the hub carrier are key in terms of the growth potential and long-economic viability of the primary hub airport.
Primary hubs have historically been developed at major political and business locations. In these locations, the hub carrier will able to count on a significant base of O&D (Origin & Destination) traffic. The airline will create opportunities for growth in connecting and transit traffic due to its links with spoke destinations. The primary hub formula targets both business and leisure, thanks to the large amount of system capacity offered to and from the airport by the hub carrier.
Example: London Heathrow, which is historically considered by USA travellors as the main European gateway, thanks to the unmatched level of frequencies along US-UK city-pair destinations.
2. Secondary Hub
An airport enterprise with a secondary-hub objective acts within a smaller geographical and commercial horizon than that of primary hubs. In fact, this kind of airport aims to manage, almost exclusively, connecting traffic on a regional basis.
The location of secondary hubs is similar to that of primary hubs, that is in regional business or leisure centers with strong O& D inbound and outbound traffic; as is the of Barcelona. Clermont Ferrant, Basel, Seattle, ST, Louis, Mumbai and Nairobi.
The commercial success of secondary hubs can be related to lower congestion level that permit smoother transfer times, as is the case of Clermont Ferrant in France.
3. Regional Airport
These airports usually manage 10-15 million passengers per year. They do not host any hub carrier as they traditionally play the role of spokes within major airlines networks. Regional airports promote a significant offer of regional carriers, the latter acting indecently or through a bundle of different partnerships with network airlines. Regional airports tend to focus on point-to-point traffic, with very little connecting traffic.
The commercial success of a regional airport relies mainly on the chance to exploit a favorable geographic location and proximity to a city’s downtown area.
4. City Airport
A subcategory of the regional airport model is provided by City airports
These operate inside city boundaries and, for this reason, are usually subject to some operational limitations in take-off and landing procedures or in the type of aircraft permitted. City airports serve exclusively business targets that are willing to pay premium for a closer-to-city departure point, faster handling services and a huge number of point services to the main regional financial centers.
5. Charter Airports – A second subcategory of Regional Airport
Charter Airports host the seasonal if traffic of charter carriers. Here the target cluster becomes a purely leisure one and the range and bundle of services offered will be reduced to stay in touch with the strict economic requests by airline operators. Many airports included in this category are now evolving themselves into the paradigm of low cost airports.
All- Cargo Airport
The main distinctive feature of this cluster of airports is that are fully dedicated to the cargo business, thanks to a package of state-of-the-art intermodal solutions (rail, road and sometimes, water)
By exploiting a favorable location, which is usually far from cities to avoid environmental limitations, this kind of infrastructure may be able to operate on a 24 hour basis.
The above framework which categories airport positioning strategies into five main areas is, of course, a simplification of the actual situation which exists in the Airport industry.
In fact, there exists much higher variance as many as 19 different market positioning that have been identified on a basis of worldwide empirical research.
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