Domestic Traveller’s Planning Tool in New Zealand

Introduction

This dissertation defines a market-driven interactive portal that fulfils multiple interrelated objectives. The first, over-arching goal is to allow ‘Kiwi Airline’ to penetrate the domestic air travel market in New Zealand. One viable strategy in pursuit of this goal requires gaining presence in media that reach all relevant target audiences without spending enormously to match Air New Zealand in mass media advertising ‘share of voice’. This means driving for cost-efficiency, managing the proportion of operating expenses devoted to marketing expenditures early in the product life cycle. Exploring this strategy means assessing the viability of a cost-efficient presence on the Internet as well as interactive and automated stand-alone presence in malls and travel agencies.

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The second strategy to be served by this dissertation is that of maximizing convenience for those who choose to patronize ‘Kiwi Airline’. Online travel services have grown and matured since the mid-1990s, when Internet penetration reached a critical mass among, first, business establishments and subsequently, the residential market. Today, families have the advantage of high-speed cable, Wi-Fi, satellite and fixed-line DSL connections to the Web. Along with the proliferation of products and services offered by e-commerce sites, air travel ticketing and travel planning have offered consumers the convenience of browsing rival offerings, finding the largest savings and packaging their entire business trip or vacation travel needs rapidly, at a time of their choosing, all without ever leaving home to accomplish anything. Interactive video facilities that began showing up around the same time in shopping malls, airports or mass transit terminals have also put more information in the hands of consumers, not least by providing access to varied trip-related services in one physical or virtual portal (Furger 1997, 7; Walters 2006, 9-11).

The Market Situation

Domestic air passenger volume in New Zealand is seasonally robust and responds positively to increased capacity. Over two decades have passed since domestic air transport was deregulated (Macilree 2009) and, other than compiling traveller satisfaction measures, Statistics New Zealand no longer reports on the industry situation. Nonetheless, traffic reports are available for the three great hubs of Auckland (AKL), Wellington (WLG) and Christchurch (CHC), from which practically all domestic flights originate, transit or designate as final destination.

At its recent-past peak, the Southern Hemisphere summer travel season, the three airports combined for just under 1.5 million passengers each month.

As of a September 2010 weekday, the three hubs jointly service 18 domestic destinations. In alphabetical order, these are: Bay of Islands, Blenheim, Dunedin, Gisborne, Hamilton, Kaitaia, Masterton, Napier, Nelson, New Plymouth, Palmerston North, Queenstown, Rotorua, Taupo, Tauranga, Wanganui, Whakatane, and Whangarei (Air New Zealand 2010). Presumably, this dissertation project will be on behalf of a new domestic carrier, which would eventually have to consider operating as many flights as possible out of the three hubs.

Such a new domestic entrant may not necessarily be hard pressed to attain a fair share of local travel. After all, Macilree maintains, the entry of Pacific Blue in November of 2007 served to stimulate (i.e. expand) domestic passenger numbers. Still, that phenomenon antedated the current recession that started in Spring 2008. An entry strategy for a new domestic carrier is crucially best timed when the economy has surmounted the negative real GDP regime that remained as of early this year (Reserve Bank of New Zealand 2010, para 2).

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Problem Domain

An interactive standalone video or Web site such as this project puts forward must serve the triple benefits of cost-savings, convenience and optimised service.

Economies must be clear from the perspective of passengers, no matter that the carrier derives savings from switching some marketing communication and customer service to the proposed lower-cost project platforms. Unlike purchase decisions involving fast-moving consumer goods (food, beverage, personal care products, affordable symbols of status and affiliation, petrol, etc.), domestic travel is not a constantly-felt want. Both businessmen and families do not go around from day to day planning the next business or leisure trip. Rather, even domestic travel is dictated by family circumstances, seasonality, and the exigencies of the business. When domestic carriers advertise price promotions in mass media, travel agency window displays, direct mail, email campaigns, and even in standalone video kiosks, target audiences may be moved to awareness that travel has become more affordable yet again and be gratified that their preferred carrier has some specials on offer. Pending a desire or need to travel, the best these traditional media can accomplish is move consumers to awareness, belief and interest but not to purchase behaviour.

The second great benefit of convenience is best illustrated when, at the stage of call to action, a Web site performs the same function as a toll-free customer service “hot line” but without the inconsistencies of the latter. Internet presence is also superior to both ticketing outlets and mass media for allowing a detailed examination of price and schedule alternatives. Consumers have full control of access time while the carrier saves on the cost of customer service representatives having to look up and discuss travel options many minutes at a time. These advantages also apply when loyal patrons wish to cash in frequent flyer miles and apply such credits to the price of the contemplated tariff.

The third tripod that is service is just as important in these marketing and communications channels. As airline and third-party travel portals become more integrated and closely-linked with business partners, convenience becomes intertwined with the service benefit. For carriers and associated vendors, interlinked Web sites are alliances that permit – for the price of foregone or shared commissions – expanded reach, more pronounced interest and loyalty from a larger base of passengers. For consumers, on the other hand, being able to plan an entire trip from departure to return is unparalleled convenience. In effect, passengers obtain return tickets, car rentals, seasonal finds for bargain lodging, camping, dining, trekking, sightseeing and entertainment choices that are worthwhile because the Web site owner effectively stakes their reputation on partners that deliver as promised. Such convenience is even enhanced when purchased packages are all billed together in one credit card statement.

Not to be overlooked is the convenience of online forms that query visitors about desired timing, airline seating, number of pax, destinations, dietary restrictions (whether for religious or health reasons), direct routing or a leisurely series of stopovers. There is also the contemporary benefit of online regional and city/street maps. Maps ease decisions such as whether someone wishing to visit Moenui (near the northern tip of South Island) had better fly in via Blenheim or Nelson. All these service conveniences used to be performed by travel agents but that value chain middleman has now been cut out and at least some of the savings passed on to consumers.

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System Requirements

Access and integration are the major requirements for an airline ticketing and travel service. Accessibility principally means being ‘open for business’ around the clock and all year round (also referred to as 24 X 7 days a week X 365 days, or 24/7/365). A stand-alone, self-running and interactive video display unit in a mall or high-traffic location fulfils this criterion for giving consumers the information they need while satisfying their more urgent shopping needs and without having to make an extra trip to the airline booking office or a travel agent.

In turn, integration means being having ready to hand convenient links to all the ancillary needs the traveller has when planning a trip. One should not overlook giving prospective passengers a wealth of choices. The narrower the range of ticket prices available, the fewer the promotional-price dates, and the more sparse the lodging and amenity options displayed, the less confident is the Web site visitor that he or she has explored all the value-price or superior choices that can be had on a given trip.

The next most important factors, the prior analysis has shown, are price and convenience. If the new airline takes a stand on “lowest available price”, the carrier must make sure to offer online all possible cost-saving arrangements, such as “companion” or “golden years” discount fares that travel agents know about. For certain market segments, after all, price is a reason to switch and stay loyal.

System Visualization

The Process Flow

The first requirement is to realize that the all-in-one air carrier Web site index page is a thing of the past. The proposed system should examine the computer system of an incoming visitor for cookies left on previous visits, if any. The absence of cookies will trigger a redirect to one of three paths appropriate for existing passengers, non-patrons who had already been to the Web site previously, and those who have never been to the Web site before. In marketing parlance, the airline Web site should present customized views and customer experience to: a) those who had only heard of the carrier and are visiting the site to learn more; b) previous visitors who had done nothing more than browse and leave; and, c) returning and loyal passengers.

Conceptually, this means a system with at least two distinct landing pages. Following the AIDA model and employing a four-point rating scale where 1 = “Minimally wanted” to 4 = “Maximum utility”, one may discern differing design challenges as follows:

Stage in Patronage Process Completely New to Airline Uncommitted Loyal Passenger
Awareness 4 3 1
Interest 3 4 3
Desire 1 4 3
Action 1 2 4

This is consistent with the semantic Web technology called Formal Concept Analysis. FCA comprises visual analytics and thus, mandates formulating a formal data hierarchy. Key to visualizing the Web site requirement is the concept lattice (as above) that relates attributes (states of mind, in this case) and objects (site visitors). The resulting cross-tabulation is the Formal Context, setting out the expectations for how site visitors interact with the graphic user interface (Zaino 2010, 1)

Someone completely new to Kiwi Airlines – possibly one who has never flown before, the secretary or executive assistant tasked to find a better deal for the boss, a free individual traveller (FIT) and tourist from abroad who, for some reason, made no bookings through his travel agent for in-country tours, one loyal to ANZ National/Link, Jetstar, Soundsair and the soon-to-close Pacific Blue – needs to know why he should shortlist Kiwi Airlines for an upcoming trip. As such, he is receptive to information that might help him learn whether Kiwi Air is a competitive choice and if the carrier is superb value for money.

But first, the system needs to capture as much contact information as possible sp that the airline can proactively include visitors to the Web site when contemplating direct marketing campaigns and invitations to promotional events. This means the landing page for those completely new to Kiwi Airlines should a) make the visitor feel welcome; b) give a foretaste of what is to come in point of service and image strengths; and, c) give some incentive to register. The casual, first-time visitor cannot proceed to flight information pages and other pages he wants unless the registration process – name, complete mailing address, phone and mobile numbers, occupation and other important socio-demographic variables, dominant purpose of travel, and any others that might help match the visitor later to market profiles or segments of varying revenue potential. The same holds for the “uncommitted”, already evincing interest and desire but still reluctant to take action by patronizing Kiwi Airlines.

Appendix A, the process schematic, therefore makes it clear that such a passenger needs, first of all, to have his confidence in the airline bolstered. Regardless of whether he travels for business or pleasure, his primary concerns have to do with reliability and safety. Is the fleet fairly young and conscientiously-maintained? What are the on-time arrival and departure record? Does the chief executive officer or airline press office respond responsibly to adverse stories about disgruntled passengers, shortcomings when inspected by government regulators, or to troubled flight operations during low-visibility weather conditions?

These concerns should be met by unassailable information on fleet age, summary records of meeting or surpassing government inspection, IATA (International Air Transport Association) ratings, possibly even passenger feedback. Devoting a good deal of space to assuaging these concerns on the landing page for potential customers amounts to the price of entry into the selection set of passengers who know virtually nothing about Kiwi Airlines except perhaps for the name.

In the current business climate worldwide, money is tight and accountants go through even corporate travel budgets with sharp pencils. Hence, it stands to reason that competitive tariffs deserve secondary prominence in the Web site for those largely ignorant about the airline.

For the market segment of decision-makers who remain “uncommitted”, however, fares may well deserve pride of place in the landing page devoted to them. After all, the uncommitted already know quite a bit about Kiwi Airlines from advertising in traditional mass media, outdoor, direct mail/email, mall and travel agent merchandising, and previous visits to the Web site. Hence, as the AIDA analysis above suggests, the uncommitted already transcend such recognition questions as “Who are they?” or “Where do they fly?” The fact that they have returned to the Web site manifests their interest and desire to be convinced. In the cutthroat climate that is the air passenger business today, price and promotional package discounting are very compelling for this type of visitor.

Once these fundamental requirements of the minimally-aware and the uncommitted are met, their landing pages should provide prominent links to the routes and schedules page. At core, after all, the functional service being purchased is about getting the passenger to his destination. Route maps, aircraft models serving each destination, and alternate flight times belong in this sub-page.

The “Overview plus Detail” layout should help those wishing to tour the country and cover as many points of personal and family history. FIT’s and locals who do not know about all the cultural and natural/scenic attractions in the countryside will benefit from having an thumbnails of colourful brochure-like pages along one side while examining the details of one destination in the main window.

The passenger who gives Kiwi Airlines all or most of his business is anxious to have his loyalty rewarded. He does not need the functional and imagery attractions of the landing page for the two other market segments. Rather, he should be redirected to the page of updated schedules, tariffs, and balances on frequent-flyer promotions that can already be applied to a planned trip.

For a businessman in Auckland who has already flown Kiwi Air in the past and now wishes to combine business in Christchurch with a leisurely tour of the Fjordland National Park, the Drag Mag technique seems ideal for planning an itinerary. Given a fixed point of departure on the upper part of the page and an interactive list of airports served by Kiwi Air in South Island, clicking on Christchurch as the first destination should trigger a pop-up that queries this choice as mandatory or optional. On clicking “mandatory”, since the businessman has appointments in the city, Drag Mag will present a magnified view of Christchurch and environs. This should be clickable with an accompanying menu that presents hotels, recommended restaurants, and famous sights in succession. Next, Drag Mag will permit examination of options for travelling to Fjordland, the principal route offered to be one to Dunedin.

Core Components of Front End

Ultimately, the business of an air carrier, whether domestic or international, is about providing the best possible service for the tariff asked. Since there is no mandate that Kiwi Air should operate as an no-frills, barebones service airline, it stands to reason that all landing and sub-pages should be imbued with a desirable image for caring and hospitable service.

At the end of the day, airlines do not compete for favourable consumer imagery with their routes, prices or aircraft. An Airbus A320 is an Airbus A320. Pilot training and certification are behind-the-scenes proof-of-competence, intangible to consumers. But an airline can demonstrate corporate social responsibility by publicizing the acquisition of low-noise, low-emission and fuel-saving engines. A Web site itself can be replete with the warmth of summer colours, the overt helpfulness of ground staff when families travel laden with bags, and the dazzling smiles of flight attendants who exude personalised service even in Economy class. These are true differentiating factors that passengers can validate for themselves when they fly Kiwi Airlines. Then they will cheerfully volunteer endorsements that the airline can post on the site to convince others still “completely new” and uncommitted.

Bibliography

Air New Zealand. 2010, Arrivals into Auckland Domestic. Web.

Furger, Roberta. 1997. Online travel: Time vs. money. PC World 15: 7.

Macilree, John. 2009. Recent trends in New Zealand domestic air passenger numbers. John Macilree’s Weblog. Web.

Reserve Bank of New Zealand. 2010, June 24. Key graphs – GDP growth. Web.

Walters, Jeff. 2006. Online natural home for travel marketing. Precision Marketing 18 (28): 9-11.

Zaino, Jennifer. 2010. Semantic web meets BI in new project whose partners include SAP, Sheffield Hallam University, Ontotext. Web.

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