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AHMEDABAD
A STUDY ON CUSTOMER
SATISFACTION IN AIRLINES
INDUSTRY
Submitted By:
RAJAT PAL
PGDM(2012-14)
Section- A
INDEX
TOPICS
Page No
Introduction
Literature Review
4-15
Problem Definition
16
Framework
17
Objectives
18
Hypothesis
19
Research Methodology
20
Data Analysis
21-30
Conclusion
31
Implementation
32
Reference
33
Page 2
INTRODUCTION
The aviation sector is one of the major economic drivers for prosperity, development and
employment in any country, we know it. The rapidly expanding aviation sector in India
handles near about 2.5 billion passengers across the world in a year and moves 45 million
tonnes (MT) of cargo through 920 airlines, using 4,200 airports and deploying 27,000
aircrafts in the world. Today, 87 foreign airlines fly to India and from India five Indian
carriers fly to foreign countries and from 40 countries.
In any business satisfying the customer is the ultimate goal or objective of any marketer.
Excellent passenger satisfaction is one of the greatest assets for air business in todays
competitive environment. Passenger satisfaction service arises when a company can provide
passengers with benefits that exceed passengers expectation and this is considered valueadded. If customers are satisfied with the product or service which the company is providing
then they will buy more, and do so more often. Passenger gratification is an essential goal for
each airline providing passenger services. The on board experience is still something special
for the customer. The customers have a wide choice to select the suitable airline product
according to their requirements. Therefore, Airlines Companies are continuously working on
the in-flight product development and innovation to differentiate themselves from their
competitors. There are many factors that can help an Airlines Company to build its customer
base, and passenger service and satisfaction can be a determining factor in the success of an
entire operation.
In our study we will be finding how customer satisfaction can be increased. What are the
factors which lead to customer satisfaction in aviation industry? What are the problems which
creates dis-satisfaction among customers?
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LITERATURE REVIEW
Page 4
3) ZENITH
International Journal of Multidisciplinary Research
Vol.2 Issue 2, February 2012, ISS N 2231 5780
Title: A STUDY ON SERVICE QUALITY AND PASSENGER SATISFACTION
ON INDIAN AIRLINES.
Author: R.ARCHANA and DR.M.V.SUBHA
They have studied the factors which influences on passenger satisfaction. They have
identified that Cuisines provided, seat comfort, safety these factors have an important role in
customer satisfaction. They have also found that customer satisfaction depends on personal
entertainment, which is an important factor in flying decisions of passenger. According to
their study online seat booking, call centre facilities and reservation/cancellation is highest
influencing factor in flying decisions of the passengers.
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Page 6
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11) Title: Measuring Customer Expectations of Service Quality: case Airline Industry
By: Ekaterina Tolpa
Date: 06.06.2012
According to the report it is found that the importance is given on the quality of the services
in order to satisfy the customer. When the expectations of the customer get fulfilled then they
become satisfied. Service quality includes customer safety, flight frequency, reliability etc.
They should also focus on customer segmentation. When the flight frequencies get increased
and safety measure is available then the customers get satisfied.
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Montreal Geneva
Vision 2050
Singapore, 12 February 2011
Giovanni Bisignani - Director General & CEO IATA
The whole research is done on the future problems, need, requirement, changes that will be
face by aviation industry. The problem describe in this research is that the number of
passengers increasing day by day and the cost of travelling has decrease, if this the scenario
now what will be in 2050. So the modification that aviation industry should do for their
benefits are mention and research has been done on these things. Solution trace out by the
research is that all the company in this industry should be united and there should be no
competition, all should go hand in hand. Even they should pursue government to join with
them. There should be change in the leadership. They said that last decade has shown that by
working together with a common purpose, change is possible and also flexibility and
openness to change will mark the way forward.
14) Linkages between customer service, customer satisfaction and performance in the
airline industry: Investigation of non-linearity and moderating effects
Adams B. Steven*
Yan Dong
Martin Dresner
Robert H. Smith School of Business, University of Maryland, College Park, MD 20742
This research paper investigates the linkages between customer service and customer
satisfaction, and firm performance in the U.S. airline industry. They had examined the
moderating effects of market concentration and firm dominance on the service-satisfactionperformance relationship. This research says that customer satisfaction and airlines
profitability are dependent and they are affected by the market. Research says that
considering customer satisfaction and customers services airlines industries can increase their
profit.
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15) Customer Satisfaction in the Airline Industry: the Case of British Airways
CONSUMER SATISFACTION
Manzoor Nazir Bhatti et. al., Int. J Eco. Res., 2010 (1(1), 19-37
The motive of this research is to find out the present and future aspects of aviation industry in
relates to growth and consumer satisfaction. The sample had been collected from various
sources. It was found that both the US and European major airlines does not had constant
profits in the business. They either had losses or marginal profits in recent history. However it
has been noticed that low cost carriers have been able to sustain in both the markets because
of their effective marketing strategies. However for both the airlines that is for executive class
as well as for low cost carriers future is unpredictable.
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Dipa Mitra
January 6-9, 2013
The 21st century is considered as the service industry century. Service industry is moving and
growing at a rapid pace across developed and developing centuries. Services generally
termed as an intangible product which can be measured by the level of satisfaction. Another
definition of service can be offered as an activity or benefit that one party offers to another in
a non tangible form. Now in todays scenario every industry needs to be properly handling
the CRM that is Customer Relationship Management. Thus it has been an important outlook
for the service industry to identify parameters that cause customer more satisfied and should
adopt those strategies.
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The airline industry has undergone through a fast moving ride for the past few years. One of
the main developments in the current aviation industry is the growing popularity of low cost
airline with high quality service. The competition between Malaysia airlines and Air Pacific
has been cut throat as regards to price factor. Both the airlines have different customer base
and hence offers different service experience. It is also note able that differentiate in
providing higher service quality is the main factor to increase or to attract customers towards
them. It has been noticed that customers are getting attracted towards the intangible service
where monetary value is less than the services being provided.
Service quality is the essence of airline companies which makes their image differentiate
from others and keep their image in the minds of passengers. Many airlines followed the
route of higher service quality through on ground and off ground service. Inboard meal is one
of the important aspect of the airline operation. Now days it became a marketing strategy.
This research depicts the reaction of customers through in flight meals to see the satisfying
level and re flying intention. Food not only sacrifices the inboard customers but also have an
effect on flying intention.
Dean E. Headley
Wichita State University, KS and Brent D. Bowen
Journal of Air Transportation World Wide Vol. 2, No. 1. 1997
In earlier days airlines quality had been measured on survey which offers the services
expected and the prescribed services. Service quality is the difference between the service
expected and the actual service being provided. Services should match according customers
expectations. The survey helps the airline companies to know exactly what they want and
accordingly operations have taken place.
23) Customer Satisfaction in the Airline Industry: the Case of British Airways
Giovanna Nicolini and Silvia Salini
Department of Economics, Business and Statistics, University of Milan, Italy
In this research paper two different non-classic methods of research had been use for research
of customer satisfaction in British Airways, based on the analysis the qualitative data are
applied to evaluate level of customer satisfaction. They said that quality and satisfaction is
based on two different approaches involving objective and subjective aspects. For the
purpose of research they had use Decision Tree theory and secondly they have use Rasch
model for study. By both the mean of study it can be said that customer satisfaction is
necessary in British Airline.
By : Aako Teikake
Degree of master of aviation
Massey University , Turitea Campus, Palmerston North
March 2012
In this research the importance is been given to customer satisfaction as it playes an
important role, as airline can survive and strengthen their competitiveness. Service quality is
an important factor for customer satisfaction, this research will be helpful for airport
management and also aircraft management in increasing the customer satisfaction. The
questionnaire was made using SKYTRAX(one of the method of research), stratified sampling
process was use for the research. Through this survey it was found that Kiribati air services
have low customer satisfaction. The problem was easily traced out as it was a research done
through primary data.
26) THE ROLE OF PACKAGING IN CUSTOMER SATISFACTION WITHIN THE
SUPPLY CHAIN : A STUDY IN AIRLINE INDUSTRY
CYNTHIA DE WET
UNIVERSITY OF PRETORIA, SOUTH AFRICA
2007
In the research author describes the importance of providing the best services, so that
customer satisfaction can be acquire. The study is been done in detail regarding supply chain
of South Africa Airways and the problem has been trace out through this detail research. Both
the primary and secondary data were use in conducting this research. Two survey has been
done in this research paper one was done with staff of the airline and other was done with
customer of this airline.
27) The vicious cycle: growth and declining quality in the
US airline industry: some lessons for new start-ups
World Review of Entrepreneurship, Management and Sust. Development, Vol. 1, No. 1, 2005
Dawna L. Rhoades
College of Business,
Embry-Riddle Aeronautical University,
600, S. Clyde Morris Blvd,
Daytona Beach, FL 32114, USA
The research says that there over 200 airlines have started up and failed in U.S. the reason
behind this was the competitive pressures and economic conditions which result to the failure
of many carriers. This research paper examines the pressures which say that rapid expansion
can create including downward spiralling levels of quality, declining load factors, and death
in the airline industry. The research paper examines the growth rates and service quality of
some airlines of U.S and helps to improve them.
Page 14
28) The inuence of service failure and service recovery on airline passengers relationships
with domestic airlines: an exploratory study.
P.G. Mostert, C.F. De Meyer & L.R.J. van Rensburg
Research paper describes that Service failures and the subsequent service recovery eorts of
an
Organization can have a profound eect on customers satisfaction with an organization as
well as on the quality of the relationship with the organization, despite other eorts by the
organization to build long-term relationships with its customers. In this research the data were
collected from passengers ying with South African domestic passenger airlines departing
from
OR Tambo International Airport. The problem regarding the customer satisfaction in
domestic airlines was traced out.
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FRAMEWORK
Independent Variable
Dependent Variable
Customer
Price
Satisfaction
Service
Quality
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PROBLEM DEFINITION
Page 17
OBJECTIVES
HYPOTHESIS
H1. Service Quality has a positive influence over the customers decision regarding choosing
the airlines to travel.
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H2. Price has a positive influence over the customers decision regarding choosing the
airlines to travel.
RESEARCH METHODOLOGY
Research Design: In order to achieve the above study objectives, we have
used the Simple Random Sampling technique, randomly intercepted and
administered fully structured questionnaires to target respondents.
Sample: We have targeted the age group of above 20 and who often use
flight services.
Area of Survey: Gandhinagar
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Sample Size: 30
Data Collection Method: We have collected data through survey
method.
Survey is done through questionnaire filling.
Strongly Agree
6
Agree
Disagree
4
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Strongly Disagree
0
Agree; 67%
Interpretation: It is found from the study that 20% of the respondents strongly prefer the
service quality and 67% of respondents also prefer service quality while flying. So the
Airlines Company should give importance to improve the quality of the services to attract
more and existing customers.
Agree
4
Strongly
Neither Agree nor Disagree Disagree Disagree
23
3
0
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10%
13%
77%
Interpretation: It is found from the research that 13% of the respondents strongly think that
service quality differs from Airlines Company to Company. And 77% of the respondents
perception is that different Airlines Company provides different types of services. So the
Airlines Company should focus on Customer services.
Strongly Agree
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Strongly
Disagree Disagree
5
0
Agree; 43%
Interpretation: It is seen from the study that about 85% of respondents want that the quality
of the service that Airlines Companies are providing should be improved. So quality is the
issue that customers provide importance in terms of satisfaction. To satisfy the customers
companies should improve the quality of the service.
Strongly Agree
Agree
7
Disagree
6
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Strongly
Disagree
0
Disagree; 7%
Strongly Agree; 23%
Neither Agree nor Disagree; 20%
Agree; 50%
Interpretation: The services which the Airlines service providers are giving in the flight it
has an important impact in terms of customer satisfaction. Nearly 75% of respondents think
that their satisfaction depends on In-flight service quality.
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Strongly
Disagree
1
Strongly Disagree; 3%
Disagree; 3%
Strongly Agree; 20%
Neither Agree nor Disagree; 23%
Agree; 50%
Interpretation: From our study we have found that 70% of the respondents prefer online
ticket booking while purchasing ticket.
Statement 6: I choose the Airlines service according to the price of the ticket.
Strongly Agree
Agree
5
Disagree
15
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Strongly
Disagree
0
Disagree; 10%
Agree; 50%
Interpretation: It is shown from the research that 67% of the respondents low fair ticket
while flying.
Strongly Agree
17
Agree
10
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Disagree; 7%
Neither Agree nor Disagree; 3%
Agree; 33%
Interpretation: It shows that most of the people and 80% of the respondents prefer to buy
tickets at the time of offers and discounts.
Strongly Agree
Agree
Disagree
Strongly
Disagree
12
3%
7%
30%
20%
40%
Interpretation: 70% of the respondents wants that their queries should be solved as soon as
possible. It has an impact on customer satisfaction.
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Strongly Agree
Agree
15
Disagree
6
Strongly
Disagree
Strongly Disagree; 3%
Neither Agree nor Disagree; 20%
Strongly Agree; 50%
Agree; 27%
Interpretation: 77% of the respondents prefer the flights which maintain the proper time
table.
Statement 10: Reduction in the price of ticket will increase my no. of flying.
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Strongly Agree
Agree
16
Disagree
Strongly Disagree
Agree; 43%
Interpretation: Most of the people i.e. maximum no of respondents wants that the price of
the ticket should b decreased and according to them it will increase the no of flying.
CONCLUSION
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Satisfying customer is the main motto of any marketer. Price and service quality affects the
customer satisfaction. Specifically consumers tend to consider the relative relationship
between price and their expectations about the performance of the product. Price plays a
major role in consumer satisfaction in aviation sector. From this study we can see that price
sensitive consumer focuses on price and compares it with the utility and benefits of the
services. If an Airline company is providing a compatible price and increase in price are fare
then customer takes it positively which creates a sense of satisfaction among the consumers.
In case of Airline services most of the customer focuses on the price of the ticket to travel. It
is found that wherever and whenever they will get a ticket for a lesser price, the customers
have a tendency to buy the ticket. Sometimes they wait for offer prices and if they also pay
high prices for the service, they will expect a good service. Conversely, younger passengers
or passengers with lower incomes are more price-sensitive, and usually purchase tickets
based on the lowest price available, and also may have different levels of expectations. This
may lead to a different service experience each flight, and make younger passengers or lower
incomes passengers less likely to be satisfied with the level of service provided. If the price
matches with their expectations they become satisfied.
Without any doubt, service quality is very important component in any business related
activity. This is especially so, to marketer a customers evaluation of service quality and the
resulting level of satisfaction are perceived to affect bottom line measures of business
success. Service quality can be defined as a consumers overall impression of the relative
efficiency of the organization and its services. Understanding exactly what customers expect
is the most crucial step in defining and delivering high-quality service. Service quality is one
of the best models for evaluating customers expectations and perceptions. If the passenger is
not satisfied, due to the negative experience, the client will reconsider the buying decision for
further flights and will probably switch to another airline. So Airline managers should better
serve their customers, monitor and develop service quality to achieve the highest level of
their passengers satisfaction.
From this research we have identified that price and service quality are two important factors
which have huge impact on customer satisfaction in Airlines Industry. So the marketers
should focus on these two factors and should take proper steps in terms of customer
preferences in this changing competitive era. Delivering high-quality service to passengers is
essential for airline survival, so airlines need to understand what passengers expect from their
services.
IMPLEMENTATION
Page 31
We have used questionnaire method where different question were asked to different
respondents. Basically all the questions were based on service and price factors. After going
through all the replies, we came to know that service quality and price does have a direct
impact on customer satisfaction in aviation industry. Customers tries to select those flights
where service quality is high with minimum ticket fare. So companies need to look deeply
into the price and service quality department so as to increase the customer satisfaction which
in turn leads to more profit. Inflight services should also be taken into consideration. We can
assume that if the service quality is more in compare to the price of it the rush of customers
will be more and vice versa. So our suggestion will be to select the best combination of
service quality and price where the ratio is equal or more than 2:1.
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REFRENCES
1) http://www.ibef.org/industry/aviation.aspx,
2) http://business.mapsofindia.com/aviation
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