Modeling air travelers’ choice of flight departure and return dates on long holiday weekends

Air travel demand is typically high on long holidays. Understanding factors that influence the choice of air travelers with respect to their departure and return dates on long holidays can help airlines make effective decisions on pricing, ticket sales, and scheduling. We conduct a stated preference survey to examine the preferences of low-cost airline travelers on a particular holiday weekend. A temporally correlated logit model is developed to account for the temporal correlation of day-of-the-week alternatives. The results indicate that airfare is the key variable affecting air travel date choices. The utility of day alternatives decreases when more leave days are required before the holiday begins. Departure dates before the beginning of the holiday weekend and return dates after the end of the holiday are highly substitutable. The low-fare strategy comprising early departures and late returns can effectively increase the load factor of off-peak flights on long holiday weekends.     

The carrier-within-a-carrier strategy: An analysis of Jetstar

The carrier-within-a-carrier (CWC)—or “airline-within-an-airline” (AWA)—approach has become an integral part of many airlines' marketing strategies in the Asia–Pacific region where several full-service national airlines operate low-cost/low-fare subsidiary airlines. The CWC approach is a response to competition from low-cost carriers based on product differentiation, i.e., a ‘two brands’ business strategy aimed at defending market share. Most CWCs were established after 2001 as a response to deregulation and liberalization and generally adhere to the principals of low-cost/low-fare carriers. Typically, CWCs enter markets through new, point-to-point services and operate short-haul routes (one-to 2-h flying times) that might have been abandoned by full-service airlines (FSAs), whereas at other times they simply compete directly with FSAs on price. This paper analyses Jetstar, a subsidiary of Qantas, which has transitioned from a domestic CWC to an international medium- and long-haul carrier. In addition to its domestic Australian operations, Jetstar operates between Australia and the Asia–Pacific region and has established partnership arrangements operating within Asia, including Jetstar Asia (based in Singapore), Jetstar Vietnam and Jetstar Japan. Jetstar also has operations in New Zealand. The theoretical framework applied in this paper is based on the strategic windows concept, in which opportunities arise and a window opens, and Tregoe and Zimmerman's (1980) ‘driving forces’ model, in which nine attributes are listed and certain of these are exemplified by Qantas' strategy. The methodology adopts a case study approach that draws upon content analysis and ‘events in the making’ and features interviews with key respondents. The findings show that Jetstar disproved earlier criticism of the CWC strategy and further demonstrate that by careful planning, strategy and execution, Jetstar has been able to grow its capacity, maintain high load factors, increase revenue and (more importantly) increase profitability at a time when many airlines are consolidating or withdrawing services because of losses.     

Inter-metropolitan airport substitution by consumers in an asymmetrical airfare environment: Harrisburg, Philadelphia and Baltimore

Airfares vary significantly over space, and can even vary substantially between airports in relatively close proximity with one another. With the spread of various Web tools, consumers are armed with more information than ever to assess fare and service differences between competing airlines and competing airports. This leads to the possibility of airport substitution for particular routes. Linear regression models are developed that suggest, despite the 70–90 mile distance, that passenger substitution may be occurring from Harrisburg and Philadelphia to Baltimore based as a result of differential fares, low-fare service, and other factors.     

An investigation into traveler preferences and acceptance levels of airline ancillary revenues

This study determines traveler preferences and acceptability levels for a range of airline ancillary products and services by employing an on-line passenger survey to examine booking preferences as well as attitudes toward a selection of air and non-air travel components sold by the airlines. The survey results are combined with expert opinions collated from a recent international conference, along with secondary data, to generate an acceptance ranking which can be used by a range of airlines to formulate their ancillary revenue strategies. It is found that airport car parking and checked baggage charges proved to be the most accepted commission based and unbundled products for airlines to sell respectively. Despite the recent focus and successes in ancillary revenues, however, it can also observed that none of the ancillary products and services examined in this study achieved a high take up rating suggesting that airlines can do much more to convince travelers of the benefit and value in airlines selling non-core products and services to them.     

What are passenger perspectives regarding airlines' environmental protection? An empirical investigation in Taiwan

Many airlines recognize the importance of environmental protection. The airlines implement a number of environment-friendly activities related to in-flight services and wish to trigger passengers' support and therefore inquire as to their preferences. Because these activities are not identical between airlines, it is not known which items are actually supported and which items are opposed. In this paper, major airline environmental protection activities were collated, and the Smart partial least square software was used to analyse data from 442 passengers who have experienced air travel in the past 3 years. The results showed that in general, passengers would prefer to choose airlines that supported environmental protection activities. However, several activity items would be rejected if passengers felt their rights or interests being compromised. It was also indicated that people from countries at different stages of economic development had varying preferences regarding their support of airlines' environmental protection activities, and the young generation had more concern about environmental protection than others. The findings of this research could be beneficial for airlines setting up their differentiated marketing strategies for enhancing both environmental protection efforts and business performance.     

Testing prospect theory in airline demand

The article tests for the existence of reference dependence, loss aversion and diminishing sensitivity in airline demand, in the context of price responsiveness amongst low cost, regular and charter airlines. We incorporate the reference-dependent model into a mixed model to control for heterogeneity. The application finds considerable differences between reference and actual prices in decision-making, confirming that reference dependence exists. People react more strongly to price increases than to decreases relative to their reference price supporting the loss aversion phenomenon and that there is diminishing sensitivity for losses only.     

Towards a maturity model for big data analytics in airline network planning

The evaluation, acquisition and use of newly available big data sources has become a major strategic and organizational challenge for airline network planners. We address this challenge by developing a maturity model for big data readiness for airline network planning. The development of the maturity model is grounded in literature, expert interviews and case study research involving nine airlines. Four airline business models are represented, namely full-service carriers, low-cost airlines, scheduled charter airlines and cargo airlines. The maturity model has been well received with seven change requests in the model development phase. The revised version has been evaluated as exhaustive and useful by airline network planners. The self-assessment of airlines revealed low to medium maturity for most domains. Organizational factors show the lowest average maturity, IT architecture the highest. Full-service carriers seem to be more mature than airlines with different business models.     

Rethinking authenticity and tourist identity: expressions of territoriality and belonging among repeat tourists on the Greek island of Symi

This paper approaches the subject of tourist identity from an anthropological perspective, arguing for a culturally contextualized analysis that focuses on the interactive and processual nature of these constructions. Specifically, it explores the processes by which repeat tourists on the Greek island of Symi construct their identities as tourists in relation to the place of their vacation experience, local residents and other tourists. It highlights the competitive and often antagonistic way in which these tourists – drawing on ideas about authenticity and demonstrating sympathy with local concerns – seek to incorporate the island as an aspect of their own personal identities and, similarly, create a form of ‘local’ identity in Symi. The picture of tourists that emerges in this case study contrasts sharply with standard analytical formulations that portray tourists as transient and liminal figures, defined almost exclusively by their vacation preferences and experiences, and constituting a category of people that is clearly distinguishable (practically and ideologically) from local residents. As a consequence, it argues for an approach to tourist identity that seeks out linkages between tourists and locals, and which looks more broadly at the views and experiences of tourists beyond the time and space of the vacation.     

Text mining approach to explore dimensions of airline customer satisfaction using online customer reviews

The airline industry operates in a highly competitive market, in which achieving and maintaining a high level of passenger satisfaction is seen as a key competitive advantage. This study presents a novel framework for measuring customer satisfaction in the airline industry. Using text mining methods we explore Online Customer Reviews (OCRs) to provide guidelines for airlines companies to improve in competitiveness. We analyze a database of more than 55,000 OCRs, covering over 400 airlines and passengers from 170 countries. Using a Latent Dirichlet Allocation model we identified 27 dimensions of satisfaction described by 882 adjectives. Dimensions and adjectives were used to predict airline recommendation by customers, resulting in an accuracy of 79.95%. The most relevant dimensions for airlines' recommendation prediction were calculated. OCRs were stratified according to several variables. Of those, type of passenger impacted the least on the number of dimensions of customer satisfaction, while type of cabin flown impacted the most. Observing results in different publication years we showed airline customer trends through time. Our method showed sensitiveness to identify variations in dimensions distribution according to different passenger characteristics and preferences. Practical implications are that airline service providers aiming at maximizing customer satisfaction should focus their efforts on (i) customer service to first class passengers, (ii) comfort to premium economy passengers, and (iii) checking luggage and waiting time to economy class travelers. Regression analysis revealed cabin staff, onboard service and value for money as top three dimensions of satisfaction to predict the recommendation of airlines. Designing services that excel in those dimensions is likely to improve the company's performance with customers.     

Regional public support to airlines and airports: An unsolved puzzle

This paper proposes a structural model to explain the motivation of regional public authorities to arrange marketing agreements for route and traffic development. Furthermore, using data from Spanish airports, we empirically test this model obtaining the demand function according to the preferences of public authorities. The results show that the public budget, airport’s attributes or intermodal competition affect to the demand for aircraft operations of regional public agencies. Finally, we propose an empirical method to determine the market power of airlines within these marketing agreements in a particular airport or route.     

Integrated airline productivity performance evaluation with CO2 emissions and flight delays

This paper evaluates the airline productivity change by applying a modified global Malmquist productivity index (GMPI) model, incorporating both CO₂ emissions and flight delays. Statistical inference is also performed on the GMPI results using the bootstrapping method. Empirical research was conducted on 15 international airlines during 2011-2017. The obtained results showed that the productivity of all airlines had been fluctuating and experienced a slight increase over 2011–2017. Most of these 15 airlines made more progress in managing punctuality than CO₂ emissions. High punctuality policy may not be the best choice for all airlines when considering financial constraints, while airlines in more liberalized aviation markets are more likely to improve productivity by reducing flight delays. Efficiency change and technological change were the major driving factors for the growth of airline productivity. European and US airlines benefitted more from superior technology, while most Asian and Oceanian airlines still benefitted from the advantage of efficiency. Based on the findings, specific management advice was given.     

A robust hybrid decision model for evaluation and selection of the strategic alliance partner in the airline industry

Owing to the cut throat competition and economic uncertainty in the market, airlines are focusing on strategic alliances for satisfying customer needs, especially in the current time which is dominated by global integration, demanding customer and fast changing technologies. This strategy is widely adopted by airlines. However, the selection of strategic alliance partner is a very decisive decision, and this selection process engrosses a number of complex processes which is result of compound reflection of associated various factors. In addition, the decision makers may be inconsistent in their views and preferences, arising due to imperfect information or intrinsic conflict between various departments. This paper presents a model based approach of an analytic hierarchy process (AHP) for evaluation of criteria and fuzzy technique for order performance by similarity to ideal solution (FTOPSIS) for the selection of strategic alliance partner. A case of Indian airline industry demonstrates the application of the proposed approach. Eventually, robustness of the model is demonstrated by sensitivity analysis.     

How airlines learn from airline accidents: An empirical study of how attributed errors and performance feedback affect learning from failure

This research examined organizational learning factors by asking whether airlines learn more from internally or externally attributed causes of airline accidents. Our dependent variable, organizational learning, was defined as a decrease in subsequent airline accident rates. To test the moderating effect of performance feedback, we predicted that performance relative to aspiration level would negatively moderate the relationship between the attribution of airline accidents and the subsequent accident rate. Overall, the findings of this research revealed that the greater the proportion of internally attributed causes is, the more likely it is that an airline will learn from its accidents and will experience a lower subsequent accident rate. In addition, our findings regarding the moderating effect of performance feedback showed that airlines performing below their aspiration levels are more likely to learn from internally attributed causes of accidents and will therefore experience a lower subsequent accident rate. We conducted this investigation by collecting data from the U.S. National Transportation Safety Board (NTSB) database for all of the accidents (accidents and incidents) experienced by U.S. commercial airlines during the 1990–2014 period. Our research findings provide implications for future studies that discuss the factors affecting organizational learning.     

A fully fuzzy network DEA-Range Adjusted Measure model for evaluating airlines efficiency: A case of Iran

Due to the competition among companies, evaluating the performance is one of the most important issues for managers. Data Envelopment Analysis (DEA) - Range Adjusted Measure model (RAM) is one of the non-radial models to evaluate the performance of companies. This paper presents a fully fuzzy network DEA-RAM model for evaluating airlines and extends the network DEA-RAM model in the fully fuzzy framework. First, a network structure is designed for airlines and then, a DEA-RAM model is presented for calculating efficiency scores. To handle uncertainty in data, fully fuzzy approach is considered and finally, a multi-objective network model is proposed to calculate airlines’ efficiencies. To solve the proposed fully fuzzy DEA-RAM model, the lexicographic approach is used and the efficiency scores are reported as interval numbers. To illustrate the capability of the proposed fully fuzzy DEA-RAM model, the actual data of 14 Iranian airlines are gathered and the interval efficiencies of airlines are evaluated.     

Impact of landing fees on airlines’ choice of aircraft size and service frequency in duopoly markets

A one-shot simultaneous game-theoretic model is applied in a duopoly market to investigate how airport landing fees could influence airlines’ decisions on aircraft size and service frequency. It is found that higher landing fees will force airlines to use larger aircraft and less frequency, with higher load factor for the same number of passengers. It is also found that airlines will be better off if some of the extra landing fees are returned to airlines as a bonus for airlines using larger aircraft, which consequently reduces airport congestion.     

Factors influencing cargo airlines’ choice of airport: An international survey

This paper identifies and evaluates the myriad of factors that influence the choice of airport by freighter-operating airlines. The findings are presented from an international postal survey of airlines operating freighter aircraft on a scheduled non-integrated basis. A number of factors such as night curfews, freight forwarders and airport charges are found to be influential and these are examined against a number of dependent variables such as the airline's home region and operational patterns in order to identify key variations.     

UK air travel preferences: Evidence from an East Midlands household survey

Air travel preferences of the general public are examined from a household survey in the Charnwood Borough Council area of Leicestershire, within the East Midlands region of the UK. Survey analysis shows that individuals frequently fly using low-cost airlines for leisure purposes, and often travel long distances to access airports. The price sensitivity of respondents to changes in air fares varies across the sample. Most respondents agree that there are both economic benefits and environment disbenefits associated with aviation.     

Voluntary overbooking in commercial airline reservations

This paper studies a voluntary overbooking model under rational expectation equilibrium to promote cooperation between customers and airlines, maintain goodwill of customers, and maximize the expected total returns to airlines. A decision tree analysis is constructed for both customers and airlines. Sensitivity analysis is conducted in both realistic and simulated no-show random variables for validation. The findings suggest considerable mutual benefits associated with a ‘voluntary overbooking’ policy that emphasizes mutual cooperation between passengers and commercial airlines. The main underlying assumption of the paper is that customers are willing to provide valuations to airlines seeking volunteers for overbooking. The originality of the proposed model is the incorporation of elements of the Rational expectations hypothesis into classical overbooking models gleaned from the literature.     

Investigating passengers’ intentions to use technology-based self check-in services

As more and more airlines have introduced technology-based self check-in services, it has become increasingly important to understand the factors affecting airline passengers’ attitudes toward this new form of check-in services and also their intentions, especially from Asian passengers’ perspectives. An empirical study was conducted among Taiwanese airline passengers using the technology acceptance model (TAM) as the basic research model while considering additional factors for further analysis such as external stimuli, perceived service quality, perceived behavioral control, need for service, and perceived risk. The findings revealed that attitude and external stimuli best explain passengers’ behavioral intentions to use the kiosks, whereas perceived usefulness and perceived ease of use have little effect on their intentions. These findings suggest that airlines in Taiwan should persuade passengers to acquire a more positive attitude toward the new check-in kiosks and should consider implementation of incentive strategies in encouraging passengers to adopt the self check-in service.     

Walking down the habitual lane: analyzing path dependence effects of mode choice for social trips

In the field of transportation, several studies have researched commute mode choice and its dynamics in the short and in the long term. Relatively less is known about mode choice for discretionary and more flexible activities, such as social visits. These choices are dynamic and depend on personal habits and preferences, reflected to some extent in the history of similar choices. This study adopts the theory of path dependence to take life cycle dynamics and habitual preferences into account. Using a dataset collected in the Netherlands in 2011, a multinomial logit model of mode choice was developed. Results suggest that mode choices for social activities are path dependent, yet not entirely. There is also evidence of switching towards faster and more flexible modes after a life cycle event.