Research Project on Consumer Behavior
Understanding consumer behavior is essential for better marketing in goods and services. In order to persuade consumers to choose their products, marketers are paying attention to investigate why people buy or how they buy to develop plans accordingly. In the airline industry, a good experience is always promoted.
Air travelers persistently demand good services and a good experience in their trip. It acts as a concept for consumers that good services and comfortable journey are standard among airlines. Marketers are interested in what a good experience for the air passengers is, what the factors affecting the perception of enjoyable experience are or what makes people feel comfortable. Investigation from the marketers has been done in the individual feeling development of comfort, and to create an environment in the plane which would stimulate the passenger to think that it is comfortable enough. By studying the consumer behavioral preferences for the airline industry, it is clear why marketers place strong emphasis on the services for the flight. Moreover, studies show that Australians were loyal in choosing the airline, yet, in recent years, the trend has changed.
"Marketing literature widely accepts the notion that atmospherics influence consumer behaviour." (KPMG 2001) Nowadays, airline services are quite standard. They do not differ greatly from each other in terms of functional or emotional features of importance. How consumer choose an airline company is by good experience, which is how comfortable or how enjoyable the experience was on the plane. According to Schiffman (2001), learning is a relatively permanent change in consumer behaviour that is caused by experience or acquired information. When the trip was enjoyable, there is a good image or a valuable perception of the airline company in the consumer¡¦s mind which drive their next purchasing decision to the same company, which is an influence on the development of brand loyalty.
How good an experience is defined as good?
Comfort is a significant factor in air travel, especially for a long flight. It also acts as a major determine of whether the experience in the journey is satisfying or not. Airline companies are trying their best to provide the most comfort to the passengers. It is obvious that consumer require a certain level of comfort in the plane.
According to the survey by Dr Alamdari from the Air Transport Group 2001 Annual Conference, indicates that among the factors which influence the choice of business travelers, comfort and leg room represents the importance level of 7.5 rating out of 10. Moreover, convenient schedule, in-flight entertainment and services also act as a major part in determining whether the airline is good or not. “United Airlines says it is removing a row of seats from every aircraft in its domestic fleet to increase leg room” (Fint, 1999). Defined by the purpose of use, an airline is just like other forms of transport, taking passengers from point A to point B. Nearly all airlines are promoting their services, the environment or most likely the good experiences that customer can have in the flight. Unlike other transportation, it is not often seen that buses, taxis and trains promote an enjoyable experience on the trip. It raises the notion of why the experience on the plane is so important for the consumer, but not the speed or the price? By comparison, air fares are much more expensive than other forms of transport. When prices are charged at the premium, especially in service industries where needs could be satisfied with different alternatives (traveling from point A to point B), consumers expect to have better services from what they choose. There is always a concept in people's mind that higher price means better quality. Therefore, when selecting among different airlines, a good experience is always more preferable. Perception teaches the customer to belief that this airline is better than others. So, to what extent for the consumers to perceive or feel that the experience is good? Tehrani (2003), indicates that passengers are more demanding for better services especially for business passengers. Moreover, he claims that customers are more satisfied with services in the context of “personal”,that is to serve the customer not as a stranger from hundreds of seats, it is to treat them as an friend of individual by understanding what the customer needs and wants while in the journey.
Consumer behaviour on Loyalty Program in Australia
“Customer loyalty programs have lured millions of Australians during the past decade but corporate collapses, regulatory scrutiny and an old-fashioned concern for the bottom line are conspiring against them.” (Matt, 2002) Australians once were to be more loyal to an airline than they are doing today. When they made a decision, they simply skipped the processes of information search or evaluation alternative to choose either Ansett or Qantas especially for domestic travel. This may have been because of the successful development of the frequent flyer program, which influenced in the purchasing behavior for the consumer. However, “a survey by advisory service Frequentflyer.com.au found that 55 per cent of frequent flyers have lost confidence in airline reward schemes since the demise of Ansett and 10 per cent are no longer interested in loyalty programs” (Wade, 2002). From the study, it shows that while business or travelers are reviewing airline reward schemes, they may not be quite as keen on them as they once were. The failure to redeem points for bonus air tickets dissatisfied the customers. Dissatisfaction is a strong influence on consumers which changes their attitude in consumer's mind toward what they had believed. Their behaviour would change from what they had adopted through attitude. In application, it means that they will try to switch to another airline and not be as loyal as before.
Online purchasing and the rise of low cost airline
“The emergence of active consumers - those who are better connected, informed and have access to an increasing array of choices, represents a challenge for many industries, especially in travel sector.” (Schwartz & O'Neill 2003) With the help of the internet and the e-business, consumers are able to get the hold of information and a better comparison among different products. Travelers are increasingly exposed to a multitude of brands and options when making their travel decisions. According to Schiffman (2001), the decision making process involves four parts: problem recognition, information search, evaluation of alternatives and purchase decision. Due to the influence of technology, consumers are able to have a detail and accurate source of information which allows them to compare the products. Information search has become easier than before. By gathering information, consumers increase their awareness and knowledge of available choices and product features. The internet affects and changes the way of the consumer to make decisions about buying. It leads to information search becoming a more significant part in the decision making process.
“Virgin - which has operated a no-frills domestic service in Australia since August 2000 and now holds about 30 per cent market” (news.com.au, 2003). Nowadays, the trends for air travelers are changing because of the rise of low cost airline. They no longer think air traveling as a luxury item. “Many business flyers are now looking to low-fare carriers to stretch their travel dollars, as well as booking further in advance to save on flight costs” (Schmidt, 2003) In the past, air travel was seen as a high quality form of travel which also symbolize of luxury and the status of the consumer with the high air fares. There was relatively less negotiable pricing of airfares. The airline benefits when customers perceive they are treated fairly and when fare levels are low enough to reduce the use of travel substitutes. In addition to internet buying, the integration in competition of Virgin Blue has broken the concepts and values of the air companies. Consumers have a whole new perception of what air service or air traveling means to them. Virgin Blue does not only enhance internet purchase, but also emphasizes on low cost airfares. Once passengers have tried low cost on short flights, they realize there is simply no need to pay high costs to travel. Moreover, “business travelers, especially the frequent flyers, feel that the major airlines are exploiting them.” (Williams, n.b) Most of the business travelers are not able book the ticket in advance, since it is difficult for them to predict and plan a trip three weeks or a month ahead. From the internet, they are able to book last minute deals, which is much more cheaper than when they carry their document and go to the loyal airline counter to get a seat. This not only results in the change in their consumption pattern or behavior. In reality, it destroys the perception of what they were loyal to before. From the increasing numbers of people switch from ordinary airline ticket purchasing to the new concept of air traveling, it shows that consumer behaviors are changing. “In a move to increase fares distribution, no-frills fares have recently been added to online booking engines and the number of people traveling are increasing” (Internet Travel News, 2003). Although the perception in people's mind doesn't really represent the reality, in fact, how the consumer sees or thinks of the product or services will drive their purchasing behavior no matter what they perceive is true or not.
If someone is asking why most of the air hostesses are good looking and always with a smile, you would probably know the answer after reading the above paper. By studying the consumer behaviour of travelers, it is obvious that enjoyable experience is always preferable. Marketers are paying attention to create an environment in the plane to ensure the quality of comfort during the journey. Moreover, decision making process of consumers are influencing with the help of information technology in recent years. However, marketers are not only facing the challenge from the internet but also the rising of low-cost airline which change the concepts of luxury air traveling to economical form of transport. Now, it is the time for marketers to recreate an image of air traveling to maintain their market share.
Air travelers persistently demand good services and a good experience in their trip. It acts as a concept for consumers that good services and comfortable journey are standard among airlines. Marketers are interested in what a good experience for the air passengers is, what the factors affecting the perception of enjoyable experience are or what makes people feel comfortable. Investigation from the marketers has been done in the individual feeling development of comfort, and to create an environment in the plane which would stimulate the passenger to think that it is comfortable enough. By studying the consumer behavioral preferences for the airline industry, it is clear why marketers place strong emphasis on the services for the flight. Moreover, studies show that Australians were loyal in choosing the airline, yet, in recent years, the trend has changed.
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From the influence on online purchasing and the rise of low cost airlines, the behavioral patterns for the consumers are different from before. It result in the final consumer perception that one good flight does not make a good airline.
"Marketing literature widely accepts the notion that atmospherics influence consumer behaviour." (KPMG 2001) Nowadays, airline services are quite standard. They do not differ greatly from each other in terms of functional or emotional features of importance. How consumer choose an airline company is by good experience, which is how comfortable or how enjoyable the experience was on the plane. According to Schiffman (2001), learning is a relatively permanent change in consumer behaviour that is caused by experience or acquired information. When the trip was enjoyable, there is a good image or a valuable perception of the airline company in the consumer¡¦s mind which drive their next purchasing decision to the same company, which is an influence on the development of brand loyalty.
How good an experience is defined as good?
Comfort is a significant factor in air travel, especially for a long flight. It also acts as a major determine of whether the experience in the journey is satisfying or not. Airline companies are trying their best to provide the most comfort to the passengers. It is obvious that consumer require a certain level of comfort in the plane.
According to the survey by Dr Alamdari from the Air Transport Group 2001 Annual Conference, indicates that among the factors which influence the choice of business travelers, comfort and leg room represents the importance level of 7.5 rating out of 10. Moreover, convenient schedule, in-flight entertainment and services also act as a major part in determining whether the airline is good or not. “United Airlines says it is removing a row of seats from every aircraft in its domestic fleet to increase leg room” (Fint, 1999). Defined by the purpose of use, an airline is just like other forms of transport, taking passengers from point A to point B. Nearly all airlines are promoting their services, the environment or most likely the good experiences that customer can have in the flight. Unlike other transportation, it is not often seen that buses, taxis and trains promote an enjoyable experience on the trip. It raises the notion of why the experience on the plane is so important for the consumer, but not the speed or the price? By comparison, air fares are much more expensive than other forms of transport. When prices are charged at the premium, especially in service industries where needs could be satisfied with different alternatives (traveling from point A to point B), consumers expect to have better services from what they choose. There is always a concept in people's mind that higher price means better quality. Therefore, when selecting among different airlines, a good experience is always more preferable. Perception teaches the customer to belief that this airline is better than others. So, to what extent for the consumers to perceive or feel that the experience is good? Tehrani (2003), indicates that passengers are more demanding for better services especially for business passengers. Moreover, he claims that customers are more satisfied with services in the context of “personal”,that is to serve the customer not as a stranger from hundreds of seats, it is to treat them as an friend of individual by understanding what the customer needs and wants while in the journey.
Consumer behaviour on Loyalty Program in Australia
“Customer loyalty programs have lured millions of Australians during the past decade but corporate collapses, regulatory scrutiny and an old-fashioned concern for the bottom line are conspiring against them.” (Matt, 2002) Australians once were to be more loyal to an airline than they are doing today. When they made a decision, they simply skipped the processes of information search or evaluation alternative to choose either Ansett or Qantas especially for domestic travel. This may have been because of the successful development of the frequent flyer program, which influenced in the purchasing behavior for the consumer. However, “a survey by advisory service Frequentflyer.com.au found that 55 per cent of frequent flyers have lost confidence in airline reward schemes since the demise of Ansett and 10 per cent are no longer interested in loyalty programs” (Wade, 2002). From the study, it shows that while business or travelers are reviewing airline reward schemes, they may not be quite as keen on them as they once were. The failure to redeem points for bonus air tickets dissatisfied the customers. Dissatisfaction is a strong influence on consumers which changes their attitude in consumer's mind toward what they had believed. Their behaviour would change from what they had adopted through attitude. In application, it means that they will try to switch to another airline and not be as loyal as before.
Online purchasing and the rise of low cost airline
“The emergence of active consumers - those who are better connected, informed and have access to an increasing array of choices, represents a challenge for many industries, especially in travel sector.” (Schwartz & O'Neill 2003) With the help of the internet and the e-business, consumers are able to get the hold of information and a better comparison among different products. Travelers are increasingly exposed to a multitude of brands and options when making their travel decisions. According to Schiffman (2001), the decision making process involves four parts: problem recognition, information search, evaluation of alternatives and purchase decision. Due to the influence of technology, consumers are able to have a detail and accurate source of information which allows them to compare the products. Information search has become easier than before. By gathering information, consumers increase their awareness and knowledge of available choices and product features. The internet affects and changes the way of the consumer to make decisions about buying. It leads to information search becoming a more significant part in the decision making process.
“Virgin - which has operated a no-frills domestic service in Australia since August 2000 and now holds about 30 per cent market” (news.com.au, 2003). Nowadays, the trends for air travelers are changing because of the rise of low cost airline. They no longer think air traveling as a luxury item. “Many business flyers are now looking to low-fare carriers to stretch their travel dollars, as well as booking further in advance to save on flight costs” (Schmidt, 2003) In the past, air travel was seen as a high quality form of travel which also symbolize of luxury and the status of the consumer with the high air fares. There was relatively less negotiable pricing of airfares. The airline benefits when customers perceive they are treated fairly and when fare levels are low enough to reduce the use of travel substitutes. In addition to internet buying, the integration in competition of Virgin Blue has broken the concepts and values of the air companies. Consumers have a whole new perception of what air service or air traveling means to them. Virgin Blue does not only enhance internet purchase, but also emphasizes on low cost airfares. Once passengers have tried low cost on short flights, they realize there is simply no need to pay high costs to travel. Moreover, “business travelers, especially the frequent flyers, feel that the major airlines are exploiting them.” (Williams, n.b) Most of the business travelers are not able book the ticket in advance, since it is difficult for them to predict and plan a trip three weeks or a month ahead. From the internet, they are able to book last minute deals, which is much more cheaper than when they carry their document and go to the loyal airline counter to get a seat. This not only results in the change in their consumption pattern or behavior. In reality, it destroys the perception of what they were loyal to before. From the increasing numbers of people switch from ordinary airline ticket purchasing to the new concept of air traveling, it shows that consumer behaviors are changing. “In a move to increase fares distribution, no-frills fares have recently been added to online booking engines and the number of people traveling are increasing” (Internet Travel News, 2003). Although the perception in people's mind doesn't really represent the reality, in fact, how the consumer sees or thinks of the product or services will drive their purchasing behavior no matter what they perceive is true or not.
If someone is asking why most of the air hostesses are good looking and always with a smile, you would probably know the answer after reading the above paper. By studying the consumer behaviour of travelers, it is obvious that enjoyable experience is always preferable. Marketers are paying attention to create an environment in the plane to ensure the quality of comfort during the journey. Moreover, decision making process of consumers are influencing with the help of information technology in recent years. However, marketers are not only facing the challenge from the internet but also the rising of low-cost airline which change the concepts of luxury air traveling to economical form of transport. Now, it is the time for marketers to recreate an image of air traveling to maintain their market share.
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