December 1, 2006 | E-mail
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The battle between low cost and traditional carriers continues
By EyeforTravel.com Correspondent
If there is one component of travel in Asia which has grabbed attention
relentlessly throughout 2006, it has to be the low-cost carrier segment.
If on one hand, the penetrative levels of LCC’s have forced the traditional
airlines to restructure their operations and address cost issues, on the other LCC’s have also contributed
immensely towards the revival of the region’s tourism figures.
Even as LCC’s gain praise from several
quarters, it was EyeforTravel’s Travel Distribution Summit Asia in Singapore
this year which set the ball rolling with some engaging comments and insights
from senior distribution executives from British Airways and Jetstar Asia.
Speaking during this summit Mark Pavlides, GM Distribution Asia Pacific,
British Airways stated: “There is a situation where both successful
traditional and successful low cost carriers are able to co-exist. This is what
has happened in Europe - growth of LCC’s have encouraged traditional airlines to
look at their costs and also their customer offering. LCC’s have so far been
unable to compete for all the customers the traditional carriers offer and
likewise the traditional carriers cannot compete for all the LCC’s customers.”
On his part, Paul Daff, Head of Commercial, Jetstar Asia Airways and Valuair,
during the same conference said the entry of LCC’s into the Asian region has
seen a dramatic increase in passenger numbers through the stimulation of pricing
initiatives, and the opening up of new routes.
“This has had
benefit for not only the traveling public but also to national economies.
The Traditional carriers have been forced to adapt to a changing environment,
but it can benefit everyone,” Daff said. As an exciting year comes to an end,
EyeforTravel is already set to conduct the next edition of TDS Asia in Singapore
on 13 and 14 March 2007.
Session two on the opening day of the
conference, will be about the impact of LCC’s on online travel and distribution.
Akin to nature of the Asian market, low cost carriers too, have
diversified models within the region and even within the same country.
Speaking of India, GoAir’s Chief Commercial Officer Raj Halve, a
confirmed speaker for the LCC session during TDS Asia 2007 says, “In addition to
traditional channels like travel agents and airport counters / ticketing
offices, GoAir also have adopted innovative distribution channels like the
internet / cybercafés, call centres, PCO’s and m-Commerce (mobile commerce).”
Just like the vast number of channels, the pricing strategy across them
is equally as intriguing.
For example, Sanjay Kumar, Vice President –
Planning and Marketing, SpiceJet Limited, another confirmed speaker, on the
issue of rate parity across the various distribution channels says, “We clearly
look at the cost involved in each channel and work out our pricing accordingly.
So far, we have maintained the same fare in the call centre as will be on the
site. But very soon, we will create a pricing difference to this channel so that
we can reduce the cost accordingly.”
Considering the intricacies
associated with one market like India, an opportunity to meet and network with
the cream of distribution executives across the region would be hard to miss!
For the early-bird discount book before 15th December 2007. For
information on reserving your place visit: http://www.eyefortravel.com/tdsasia2007
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