presentation by cbs students on star alliance
TRANSCRIPT
Represented by-NavoditSaurabh
RajanAjayAtul
Star Alliance is the world's first and largest
airline alliance.
Star Alliance currently has more than 21,200
daily departures, and serves 1,172 airports in
181 countries.
Launching date 14th may 1997.
Star Alliance has since grown considerably and
now has 28 member airlines.
An airline alliance is an agreement between two or more airlines to cooperate on a substantial level.
Alliances provide a network of connectivity and convenience for international passengers and international packages.
Cost reduction from sharing of: ◦ Sales offices ◦ Maintenance facilities ◦ Operational facilities, e.g. catering or computer
systems. ◦ Operational staff, e.g. ground handling personnel,
at check-in and boarding desks. Traveler benefits can include:
◦ Lower prices due to lowered operational costs for a given route.
◦ More destinations within easy reach. ◦ Shorter travel times as a result of optimised
transfers.
History Network Benefits
Before Star Alliance, global travel was complex and inconvenient.
Connections were uncoordinated, problematic and time consuming.
Network Benefits
20031999
20001997May 14Air Canada, Lufthansa, SAS, Thai Airways International and United Airlines launch the Star Alliance network.
OctoberVARIG Brazilian Airlines joins the Star Alliance network.
MarchAnsett Australia and Air New Zealand join the Star Aliance network.
OctoberWith an official Launch Event in Tokyo, ANA joins the Star Alliance network and Singapore Airlines officially gains Observer Status to join the Alliance.
MarchThe Austrian Airlines Group, comprising Austrian Airlines, Lauda Air and Tyrolean Airways becomes the 10th member of Star Alliance.
AprilSingapore Airlines joins Star Alliance.
JulyBritish Midland and Mexicana join Star Alliance.
MarchAsiana Airlines joins the Star Alliance network.
AprilSpanair joins the Star Alliance network.OctoberLOT joins Star Alliance.May – US Airways application approved
The Star Alliance Network continues to grow.
Network Benefits
Destinations 55Fleet 50
longhaul 5shorthaul 45
Annual Passengers 2.8mAnnual pax revenue $553mEmployees 4,100
Compare Lufthansa
222 mainline aircraft
49 m passengers
39,000 employees
Hubs in Philadelphia, Pittsburgh, Charlotte
279 mainline aircraft
47 m passengers
40,000 employees
Adding 100 destinations to the Star Alliance network
External Presentation .:. New Member to be .:. p. 11 .:.
Compared to other alliances, Star Alliance offers today
More flights – over 10,000 non-stop flights daily – an alliance member carrier flight takes off or lands every 4 seconds
More places – 128 countries and over 700 airports
Better connected – via coordinated schedules at key hubs
Benefits
Star alliance sky team one world
28 members 13 members 11 members Dest-1172 Dest-898 Dest-871 Rev-$156.8b Rev-$98b Rev-$90bPassengers per year- 672 million 385 million 335 million Future members-Air India china airlines kingfisher
26.9%
12.8%
18.4%
10.1%0.8%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
Star Alliance SkyTeam oneworld
22.9%
19.2%
KL/CO/NW joining
Glo
bal
RP
K S
har
e 20
09
Source: IATA WATS, 2009
LX joining
A d vertis in g D irec t M arke tin g S a les P rom otion P u b lic R e la tion s P u b lic ity P erson a l S e llin g C yb b er M arke tin gIn te rn e t M arke tin g
ATM
StarNet links member airlines computer systems
It keeps passengers and information flowing
Allows more E-transactions, e.g. Interline E-ticket, PNR-Servicing, Schedule, Operational & Accounting Data Exchanges
Network
BTI Switzerland & Star Alliance - Key Account & Sales Workshop
Agent Educational Programme offered by Star Alliance Italy
Large geographic network. Cost savings via joint purchasing,
marketing, planning, etc. Higher number of flights offered. (increases
potential of sales) Relatively seamless travel experience. Code sharing. (Increased route
rationalization.)
Increased opportunity to reach economies of scale.
Assist in elevating brand awareness (i.e. Thai airlines, much greater exposure)
Facilities in airports. Services in regions. Seamless travel experience is inconsistent. Lack of innovation. Alliance is essentially a
facilitator, not an innovator. IT systems (incompatibility of systems)
Expansion in INDIA. Further integration of services (i.e. Facilities
in airports, services in regions, IT systems, etc)
Development of tools to measure effectiveness of alliance (metrics). i.e. Measure which passengers were brought in as a result of alliance. Also, measure the intangible benefits that the alliance exudes across the board.
Too many alliance members. Can lead to conflicts of interest, which in turn can lead to dwindling competitive advantage.
Airline industry is fragile which poses many uncertainties.
Terror threats 9/11,26/11. Rise in popularity of low cost travel carriers.
Poor integration can lead to lose of consumer confidence in the alliance.
(i.e. Ansett Australia went bankrupt in 2001 causes a huge disruption in baggage transportation resulting in negative publicity for the entire alliance)
Geographic :customers are located globally with varying wants and needs or behaviors and the organization attempts to exploit this by providing airline services to major cities/ routes evidenced.
Psychographic – attempts to capture what is driving the customer’s behavior, such as values. variations of cabin classes (First, Business and Executive Economy) to meet the product needs and wants of people.
Behavioral – Segmenting the market based on observable issues on consumer behaviour when consuming the products. Characteristics include frequency of consumption, buyer readiness and commitment. The corporate market tends to be a frequent flyer that could gain benefits from SIA’s Frequent Flyer program (KrisFlyer and PPS Club), in return for consumer loyalty to the airline.
Positioning is not what you do to a product; it is what you do to the mind of a client.
Target high-international travelers. The goal of the campaign is to help
travelers understand the benefits of the Alliance and
encourage them to travel on Star Alliance member carriers.
Marketing communications objectives
a)To develop Brand awareness.b)To increase demand/sales for offering.c)To change customer attitudes/perceptions
about the firm.d)To encourage repeat traveling.e)To become highly competitive.
Advertising design : all under one umbrella Type of appeal : humour Target people business class people Slogan : The way the earth connects Media selection : business journals ,
newspaper & television
promotional tools to be selected Television Business journals Corporate newspaper
Percentage of the budget
Television 20% Business journals & magazines 50% Corporate newspaper 30%
must focus on moving forward is to further integrate their services
more offering to customers a much larger travel coverage area, frequent flyer miles, etc.
create a more robust centralized IT infrastructure that integrates all systems.
develop the necessary tools to quantify the alliances absolute value.
Thank You