Low Cost Carriers Vs Full Service Airlines Essay

1175 words - 5 pages

Research was conducted to understand passengers’ views and attitudes towards Low-Cost Carriers and Full-Service airlines. The research was focused on a group of passengers with one crowd using a Low-Cost Carrier and the other using a Full-service airline. The airlines that will be used in the research are Aer Lingus and Ryanair running in a fully developed European market, and Malaysia Airlines and Air Asia currently functioning on a recent developing domestic market in Asia. After conducting the survey, results show that the younger people are more likely to use Low-Cost service carriers with Ryanair accounting for 24% and Air Asia with 47% who all belong in the age group of under 25 years. 87% of the age group were travelling to visit friends and family and for education purposes of whom these trips were sponsored by their parents. It is apparent in these results that age is a factor in which types of aircraft to use for travelling. Adult passengers favour Full-service carriers because of the extra services they offer unlike Low-Cost carriers. Travelling in a group is also taken into consideration for preferred choice of carriers. As a result, leisure passengers who travels in groups tend to use Low-Service carriers compared to Businessmen who usually travel in alone tend to use Full-Service airlines. Findings show that Ryanair holds 40% of passengers travelling in groups and Air Asia with 31%. In terms of booking flights, 78% of Ryanair’s passengers prefer to use the website compared to Aer Lingus’ passengers with 16% who prefer booking their trips through travel agencies. Additionally, 93% of Ryanair’s passengers who were surveyed booked their tickets online indicating that Ryanair is the fifth most searched website worldwide that clearly determines the significance of its brand recognition (ADD Reference). Similar results were illustrated between Malaysia Airlines and Air Asia where the Low-Cost carrier’s passengers used the website as their method of booking whereas Malaysia Airlines’ passengers do the exact opposite method.
According to Lawton (ADD Reference) the price rates of Low-Cost Carriers would generally cost 50% lower than traditional Full-Service airlines. During 2002, Ryanair would charge its one-way fares at about 50 Euros. The Pricing approach adopted by Ryanair more commonly termed the ‘Ryanair effect’ had become a popular marketing strategy worldwide. Part of the Ryanair’s strategy for increasing market demand is the distributing of free tickets. In the first few months of 2003, Ryanair had distributed 100,000 free seats as a way to celebrate its opening of its new outlet at Bergamo. As a result, Ryanair received 90million passengers in 2004 and consequently offered 900,000 seats at 90 pence. Researchers have accumulated that within 5 years time, Ryanair would plan on giving away 50% of its flight tickets for free. Accordingly passengers’ perception of LCCs will thus expect lower fares from Low-Cost Carriers, especially...

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