Study finds that Indians Value Punctuality Over Cheap Flights

Market research on consumer behavior and noticing the associated patterns of changes makes it possible to dispel the old beliefs and effect suitable changes in the strategies of business. One such recent study conducted by the Indian Institute of Management, Ahmedabad, has dispelled the old notion related to the Indian aviation that it is a price sensitive market and it is essentially by maintaining the lowest air fare of the tickets that the airlines are able to garner more of market share and customer loyalty.

Spic(e)y Discounts On Indian Skies

It seems that Spicejet is the main driver of the discounted flights in the Indian aviation market. It brings up one heart-warming offer of cheap air tickets and the others are left with no option but to follow the suit. This happened in May, 2012 last year when it cut down its prices to abysmally low levels on the occasion of its birth anniversary. Again this time in January, it has now come up with a new exciting offer for travelling anywhere in the domestic sector at the rate of Rs 2013 for travelling from February 1 to April 30, 2013.

Struck by High Diwali-time Fares, Ajit Singh Orders CCI Probe

It is not new that the charges of cartelization of prices have been leveled against the domestic airlines. Before this year, there have been at least two other occasions in the last two years when the charges of increasing the prices of the tickets by airlines acting as a cartel have been leveled. On one occasion even the Competition Commission of India conducted the probe but found no evidence of it. This year, the charges and the CCI probe are back in news. At first, it was Captain Gopinath who brought forth this charge of FIA acting as a cartelization body under whose garb the airlines fix the entry level prices of the tickets. Not long after this charge was made, the people who wanted to fly on premium domestic sectors on Diwali found the prices to be just too high to be reasonable. Even the airlines which offered the lowest air fare were charging unexpected higher sums.

It was this unexpected exponential rise in ticket prices, even of the cheap flights offering airlines, which was considered well beyond the realm of reasonableness and the demand-supply mathematics, has led to the ordering of a probe by the Minister of Civil Aviation, Mr Ajit Singh. Under the terms of the probe, the CCI will be required to investigate the reasons in the high prices during the Diwali time and also to look into the charges of cartelization which have often been leveled against the airlines.

It is noteworthy that the airlines release the number of seats and fares for each flight in buckets. The first bucket generally has the lowest price and its seats get booked, the next bucket of seats and its prices is rolled out. The last bucket has the highest prices. Generally, the more is the demand, the more are the prices. And, this is precisely the logic of high demand and less supply in the last buckets of seats which is advanced for justifying high prices. But, the lid seems to have gone too high this time, prompting a probe into the airline ticket pricing system of the airlines. 

Indian Winters: Weather Plays Spoilsport In High Demand Times for Flight Booking

The winters are back, as usual, with their own set of benefits and troubles for the airlines and the passengers. The winters are good seasons for tourism in India, as the people are saved from heat of the sun which prevents them from making vacation and travel plans. Similarly, this is the time when a number of festivals happen around the world and there are working offs in most parts of the world. These are the times when the people plan their travel schedules and set-off to vacations in different parts of the world. If you had tried doing a hotel booking in this season in India, you would realize the heavy tourist rush during this season since most of the hotels would be reporting a total booked status for days and months ahead.

Heavy domestic and international tourist demand makes the flight tickets pricier. You shall not expect the lowest air fare during this season. And, even if you are flying on the dearer tickets, you shall not expect that the flights will be operating on schedule and that you will be saved of the troubles and inconvenience which arise due the flight operations in winter season. There are good chances of getting the dense blankets of fogs all through the late evenings to the early mornings. And, if the fog is able to beat all the advanced flight landing and take-off systems such as CAT II or CAT III and which it does more often than not, then you can always expect time delays in the flights or even the cancellations of flights.

This also puts a lot of pressure on the seat factors in the flights operating at times when the fog is expected to be clear since the people prefer to do flight booking at these times when fog is not around. So, there is huge demand and the cheap air tickets are out of question. In fact, the fliers can expect long queues at congested airports, waiting for their turn. Airlines can also expect to see a rise in the number of flight cancellations and the consequent claims for refunds. So, the typical weather conditions of winters make these both the restraining factor as well as the high demand factor for booking domestic and cheap international flights.

Lessons from Kingfisher Airlines debacle

Kingfisher has landed itself in a $2billion soup with the end result of license being cancelled. As the downfall looks imminent, there are lessons to be learnt by the key stakeholders, chiefly the banks and the airlines since it is the former which will take the financial hit and the latter will lose out on a huge potential that Indian aviation market holds for the future. It is ironical that the lowest air fare domestic carriers have taken a lead in the Indian aviation market over the best value airlines that operate the domestic and international routes.

Let us first take banks for what lessons shall they learn. It is quite understandable that the present condition of the airlines has not been like it all of a sudden and that it has been developing for a long time now. There was sufficient time for the banks to have turned off their taps of funding and pressurize the airlines into working with more financial discipline. What made the banks reach this stage? Were the banks expecting too much from the other, cash rich businesses of the Kingfisher owner? By turning a blind eye to the basics of financial management and hoping too much from the other business, the banks led themselves into a comfort zone which was a myth, a bubble which could have been created by the airline management. So, the lesson for the banks is to view each business of an owner as totally distinct from the other.

For the management of the airlines, there are many obvious lessons to be learnt on the front of operational and fiscal prudence. However, the lessons shall also be learnt on being careful not to hit the soft underbelly of trust of the customers and employees on which the turnarounds can still be achieved even if the biggest of financial troubles come up. The recent statements of the top management of Kingfisher on employee attitude do it no good. They were still with the airline for being without salaries for months. Rather, a harsh look at the extravagant ways of management and luxurious facilities to the staff could have been a more prudent step to take. When times are bad, the management turns to operational and financial management by curtailing the flight plans, providing cheap flights and doing many other things and it conveniently forgets the “soft under belly” which forms the basis of any successful turnaround. 

What makes Japan suitable for LCC operation?

Recently, there has been news of not one but three low cost carriers making foray into the Japanese aviation space for the first time. AirAsia Japan, Peach Aviation and Jetstar are the three airlines which have recently announced their flight operations in the country. It has also been reported in the news items that for the people of Japan, who love to buy expensive things, this would be a new trial. It is expected that the rates of flight booking will simply be slashed to half with the operation of these new airlines. The people might have to live with certain limitations and constraints but they would get to travel at lowest air fare, for their business as well as for their vacation needs.

There are many factors which favor Japan for the LCC operation. These are:

• An island nation: Japan is an island nation. It has many islands under its sovereignty which are good locations for vacationing and are frequented by the people of Japan as well as the outsiders. With air travel becoming cheap with the introduction of LCCs the vacationing as well as business trips are expected to increase to these islands.
• Travel to nearby foreign destinations will get cheaper: There are many nearby countries and cities which can be reached within a few hours flight of the LCCs. These are South Korea, China, Russia and Taiwan among others. With fares almost down to half of the present value, there is going to be encouragement to the movement of the people on the short-haul flights which see high demand from the people of Japan.
• High per capita incomes: The per capita incomes of the people of Japan are one of the highest in the world. The LCC operations are likely to be highly successful since the people already have a penchant for air travel and the lowest air fare tickets are expected to give it a fillip. 

Taking Polar Routes For Cheap Flights

Routes have always been one of the prominent methods of effecting the cost control over the flights fares, providing cheap flights to the customers. While there been lots of information on lowest air fare of the direct, via or connecting flights and also of the single or the two way routing fares, there is also another route which reduces the travel time significantly and, consequently, the airlines using these routes are able to provide the lowest air fare to the passengers. These routes are the polar routes which connect the transcontinental cities.

Out of the two polar routes, it is the North Pole which is used the most by the carriers for travelling between destinations in USA, Europe and Asia. The use of these routes cuts down on the flight distance, saving not only on the time but also on the fuel. There are some conditions and preparations required by the airlines for travelling from these routes. These are elaborately mandated by the FAA of USA. The routes which are most commonly used are of connecting the northern European cities with the destinations in Canada and western USA. Similarly, there are destinations from the interior of USA which are connected with the Asian cities using this route.

Earlier, there were many restrictions imposed on flying of different aircrafts due to the special climatic conditions of these regions, some of which have been relaxed now. Earlier, the two engine aircrafts were not allowed to fly on these routes but this restriction has now been removed due to development of better technology. Earlier, there were problems of cheap flights encountering prospects of fuel freeze which have now been removed with the development of systems which can signal this happening well in time, giving the aircraft sufficient time to descend to lower altitudes. 

How being loyal really pays off with cheap flights?

Do you prefer travelling one airline as compared to the other one due to any reason? Do you know that every airline has a loyalty rewards program in which it seeks to provide certain benefits to the passengers who prefer to travel with it for most part of their travel needs Most often, these programs would require you to travel a particular number of flight miles with it so as to be eligible for such a program and win the rewards points. These programs are provided by most of the full service carriers which do not provide the cheap flights generally to the passengers but withhold this benefit for those passengers who fly with it frequently.

These benefits of being loyal to the airline for much of your air travel requirements need not necessarily be in terms of the lowest air fare, but it could be also be provided in other ways. The airlines or the agencies collaborate with a number of other shopping portals and provide the products at discounted prices for the loyal flyers. These points can also be used to earn the free flying miles which can then be used for travelling without paying any price for the air ticket. Further, these accumulated points can also be used for upgrading your travel to a higher level and get the experience of travelling in a more luxurious way at the same lowest air fare of the cheap flights. You can also use these rewards points to fly with the alliance partners of the airline by booking the cheap flights to those destinations which are flown by these partners.

Some people are of the opinion that it is better to find the cheap flights every time you have to fly and do not bind yourself to travelling with one airline. However, since people do have preferred carriers, gaining the loyalty rewards does bring qualitative and quantitative benefits to the passengers.

Punctuality is the differentiating criterion for Indian carriers, not the cheap air tickets

What makes IndiGo a more successful carrier than the other airlines in India? Why do people prefer some airlines more than the others? Are cheap air tickets the main criteria for booking the flights which people consider as important? Well, it is true that the lowest air fare plays a significant role in the decision making process while buying the air tickets but, at the same time, there are certain other elements which are held to be important. These other factors could also make a person take to the relatively dearer tickets rather than the lowest air fare of the airlines. One of these factors is of punctuality.

Punctuality refers to the ability of the airlines to take off and land at their scheduled times under normal circumstances. This is one of the main reasons why people would still prefer to fly with an airline rather than one which is offering cheaper air tickets. Business travelers or vacation travellers, all value their time and would not like to waste it in delays and cancellations. For this reason, people would prefer to fly with the airline which has a past record of adhering to the flight schedule, save the conditions which are not under their control and which lead to the delays.

Indian carriers have this rather irritating tendency to delay the flights and there are a number of reasons responsible for it, the main among these being the inadequate infrastructure of aviation. However, the inefficient ways and means of the airlines are also responsible for these delays and cancellation which cause extreme inconvenience to customers, even making them miss important business tours. For this reason, the airlines which have a history of operating punctually are preferred for travelling rather than the lowest air fare, which is considered to be the main criteria for cheap air tickets booking. 

Why travel products sell online?

There has been a recent spurt in e-commerce business worldwide. A wide range of consumer products, branded or non-branded, are being sold from the online platform. Although the success of these online stores depends on a number of factors, some products, by virtue of their very nature, make for good online sales items. Travel products such as the cheap air tickets, hotels and holiday packages are some of these good online selling items. What makes these products good for online sales?

Customers Restricted from Seeing Products

Buying airline tickets is different from buying other consumer items since you can visit a retail outlet to see other products but not the airplane seats. Since there is no option of seeing the seats in real-life before buying the tickets, it does not make any difference whether these are bought online or offline. Since online medium of purchase is far more convenient and also provides all required information, it becomes the preferred medium of booking flights. The same is also true of the hotels and holiday destinations where the customers have restriction or limitation which prevents them from seeing these before buying.

Presence of Independent Credible Reviewers

Since you cannot see the travel products most of the time before buying these, who would you trust for advice and suggestions? There are companies which review and rate the different travel products and their suppliers on regional and global basis. These provide credible information resources for ascertaining the quality of travel product. Presence of these companies has facilitated online commerce in travel products.

Uniqueness and Localized Nature of Products

Travel destinations are unique in their own respect and localized in nature. These might have been replicated in different countries but are separated by great distances. The same is true for hotels and airlines as well. Due to their highly localized nature, it is not possible for people from faraway lands to see them in real and also, these products cannot be taken close to customers. So, selling of cheap domestic air tickets, lowest airfare international flights, hotels and destination packages is witnessing an increase.