|Type of paper:||Thesis proposal|
|Categories:||Advertising Data analysis Airline industry Strategic marketing Marketing plan|
In general practice, airlines keep clients' records whether for domestic or international travels. Such information is guarded with respect to the confidentiality policy and third-party access policies as may be determined by various licensing and regulatory bodies. Nonetheless, such information regarding bookings for specific routes, the demographics of specific customers can be used professionally by the top management teams or strategy, expansion, and growth departments to analyze airline service consumption patterns. The trends are analyzed through regression and other market analysis models to paint a picture of what the likelihood of the market in say five years will look like. This forms the basis of identifying the target groups in terms of promotions and product information dissemination.
Besides, the finer details distilled from such raw information are used to determine the appropriate mode of advertising and campaign. This is primarily due to the fact that different platforms have different levels of appeal to distinct segments of the market. If your target is millennial, for instance, you ought to orient your promotions and campaigns through social media. A majority if not all of this young generation spend a considerable amount of their time either on sites like Facebook, Twitter or video streaming on YouTube. For relatively older generations you can choose major broadcast houses as they are likely interested in news and other happenings across the globe.
Baby Boomers Airline Market Segmentation
The practice of market segmentation is not unique to the aviation industry. Both Service-oriented firms and product manufacturers, wholesalers and retailers often find market segmentation as one of the rightful business tools towards the provision of tailor-made customer products and services. In this case, we have settled on the baby boomers as our unit of analysis as regards air travel and their overall flight patterns. Baby boomers market segment is significantly reliable if anyone wants to get a true picture of the aviation industry across the world. This is explained by the definition of this market segment.
According to Kenton (2019), Baby Boomer is a term used to describe a person who was born between 1946 and 1964. This generation, the website further explains make up a significant part of the entire population especially in the developed nations. In the US the group makes up 20% of the entire population. By virtue of its size, any marketing campaign should focus its efforts towards analysis of this group's consumption trends. Historically, baby boomers refer to a group or generation that emerged as the curtains of World War II fell. As guns went silent, there was an explosion of birth rates owing to the renewed hope of peaceful coexistence among nations. An estimate of about 77 Million babies was born in the US only. The Increase in population led to a sharp rise in the demand for products and services across industries with the effect of continuing hitherto.
While baby boomers created an avalanche effect in the world economy, one sector they continue to significantly contribute to is the airline. According to Chatterjee and Wang (2012), there were significant increases in online travel information search and online transaction of travel products in the late 90s and early 2000. The baby boomer generation reported a greater increase in travel information search and purchase behavior than generation Xers. Baby Boomers born between 1957 and 1957 otherwise regarded as younger baby boomers recorded the highest travel ticket purchases than the rest of the groups (Beldona, 2005). Beldona (2005), continues to showcase the significance of this group by indicating that the research findings showed that the relatively older cohorts of the boomers, those born between 1943 and 1957 and 1948 to 1952 had comparably larger increases in online travel information than the two younger boomer cohorts. This shows the premium which ought to be applied to these cohorts as far as airline travel is concerned.
Further, the demographic market segmentation as represented by baby boomers as provided insightful trends which further evidence the importance of this group. The quantitative research by Chatterjee and Wang (2012), which was partly examining the roles of demographic variables on comparative search duration and dispersion revealed that old baby boomers (1946-1955) had lower search dispersion but relatively higher search duration as compared to younger boomers (1956-1964) which point to the likely less efficient in comparison shopping among the old baby boomers. The explanation given to this finding is that older baby boomers may be having more discretionary time available for air travel planning and are highly likely to factor in subjective attributes in the evaluation of their alternatives.
The American Traveler Survey (ATS) conducted a research in 2003 which was based on data collected on a number of travel and leisure patterns in a bid to observe and maybe forecast future trends in the said patterns. Although the research was conducted using the data collected from US households, the researchers argue that findings normally represent the global picture. The research indicated that Boomers traveled more for leisure than their parents did. According to Theobald (2012), Segment Travel Patterns, Baby Boomers are considered to be golden by most professionals in the travel field. Its size, propensity to travel, and the fact that populations in developed countries around the world continue to age, place it high on most travel marketers' list of groups they want to attract. However, it means only slightly above averages for the total population on the characteristics measured (i.e., visits to domestic and international destinations and planned trips). The above research findings attach a number of reasons as to why baby boomers have a high demand for both local and international travels. Some of the reasons include; Baby boomers are relatively old hence on a higher income bracket. This is because high incomes correlate with career advancement.
Secondly, boomers are presumed to have greater household assets hence a higher likelihood of traveling because they have extra resources over and above their annual incomes. Lastly and not least, the boomers most of whom have retired or close to retiring have a lot of free time to make their travel enquires and travel at the same time. Unlike other groups which are either in school or professionally engaged in gainful employment, the boomers have accumulated enough wealth to afford them travel luxuries around the world.
However, despite the research findings indicating that boomers have high travel search logs across websites, it is interesting to note that younger generations have more appetite for travels and the general adventure trips only that resources and time limit them. Therefore in as much as marketers should channel their efforts towards leveraging the Boomer's bookings they should also get their record right as to the seasons when millennial and generation X are likely to make travel inquiries especially during summer holidays.
Baby Boomers Airline Market Communication
Market communication is essential in any business model. This is due to intense competition, especially among airlines. In as much as the number of travelers has grown exponentially since the end of World War II, it is imperative to note that the number of service providers has also considerably grown. Market-oriented communication not only inform us about the packages available but also inform us the promotions and other offers that airline may be offering to different classes, and in this case demographic segments as represented by the older generation (Baby Boomers).
The fact that campaigns aimed at different sections of consumers may translate into positive changes in the demand for products available in a given airline. For instance, Emirates Airlines known for its presence worldwide has some of the best customer-oriented campaigns and business promotion tools that has helped it scale the heights of the airline service industry. Headquartered in Dubai, and owned by the government, Emirates Airlines has grown since its inception in 1985 and carved its niche among the best brands in the global aviation industry. Emirates uses a mix of campaign tools some of which are discussed below.
According to Bhasin (2017), Emirates uses various packages that are meant to appeal to various segments of the market. Though not necessarily captured as boomers or millennial customers the various classes introduced by Emirates management point to a successful campaign informed by reliable market data on customers income, age, and other leisure variables. First, Emirates Airways employs the use of a variable pricing policy with value addition on each segment. Basically, its services are categorized into three different classes for marketing and pricing purposes. The premium first class category attracts the highest pricing, but of course, that commensurate the quality of services offered. Emirates Group, as elaborated in its service charter though indirectly lets you have value for your money.
The second class travelers are afforded what is termed as semi-premium pricing policy which equally ensures travelers charges have translated into equitable value for their coins. The third price-oriented policy as regard Emirates airlines is the economic pricing model which is meant for the lower tier customers. As such, the graduating pricing policies have become one of the competitive advantages that Emirates airlines continue to leverage to attract more customers.
Going back to demographic market segmentation, the management of this Airline may have boomers at their strategy level. The fact that first class is reserved for luxurious and deep-pocketed travelers, chances are that the Airline has effectively and competitively captured the aging but resource travelers market to their advantage. The pricing and unique classification of Emirates Airlines is one of the factors that has immensely contributed to the growth of the airline to be among the global firsts. O'Connell (2011), captures this immense growth in numbers by stating that Emirates turnover was almost 20% of Dubai's GDP, and the airline was regarded as the embodiment of Dubai's rapid rise to international prominence.
Besides, owing partly to its friendly pricing model and the quality for money in terms of the services offered, Emirates in 2010 operated passenger flights in excess of 2400 per week which landed in 105 cities across 62 countries globally. The Group as of 2010 had the manpower of 28,000 employees spread across the world with 13,000 being cabin crew drawn from at least 120 countries (Nataraja & AlAali, 2011). The pricing model as captured earlier is just one of the factors that have contributed to the soaring image of this Airline. There are other campaigns that are as well directly or indirectly related to market segmentation.
Nataraja and AlAali (2011), further argues that Emirates is renowned for market trends pioneering new ideas, often in contrast to the conventional industry's view, and several notable services including personal entertainment systems in all seats, private first-class suites, use of mobile phones on board, introduction of SmartLanding and SmartRunaway safety solutions. All this points to the tailor-made that are meant to make boomers whichever their class is, comfortable at home. It is, however, noteworthy that such an intensive campaign does not exist in isolation. The top management is committed through various initiatives and strategies to ensure that Emirates remains among the most admired and most-sought airline service providers. .
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