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electronic commerce strategy technologies and applications

e c o m m e r c e

Chapter 5: Case study


e-Commerce in passenger air transport
Airline

Booking Sys.

Telephone

Travel Agent

Web

Passenger
E-Commerce David Whiteley/McGraw-Hill, 2000

electronic commerce strategy technologies and applications

e c o m m e r c e

Airline booking systems


Developed in the late 1970s by some large airlines. Notable examples are: United Apollo American Airways Sabre Initially a competitive weapon for the owning airline. Latterly developed as unbiased markets to sell seats for any airline.
E-Commerce David Whiteley/McGraw-Hill, 2000

electronic commerce strategy technologies and applications


E-Commerce David Whiteley/McGraw-Hill, 2000

e c o m m e r c e

Airline booking systems


Currently three major e-Market airline booking systems:

Sabre
Galileo Amadeus

electronic commerce strategy technologies Checkout www.sabre.com and applications


E-Commerce David Whiteley/McGraw-Hill, 2000

e c o m m e r c e

Sabre
Sabre (American Airlines): Started in the early 1960s Installed first terminal in a travel agency in 1976 Provides web based access via travelocity.com At the time of writing Sabre: Is processing over 400 million bookings a year for over 440 airlines (about 40% of the world market); Is linked to more than 210,000 terminals; Uses 30 mainframe computers (US based); Has peak processing exceeding 7,450 messages/second.

electronic commerce strategy technologies and applications

e c o m m e r c e

Galileo
Galileo (United + European Partners): Started in 1971

At the time of writing Galileo: Is processing over 250 million bookings a year; For over 530 airlines (about 30% of the world market); Is linked to about 160,500 terminals; Uses 21 mainframe computers (US + UK); Has peak processing of about 5,000 messages/second.
Checkout www.galilieo.com
E-Commerce David Whiteley/McGraw-Hill, 2000

electronic commerce strategy technologies and applications

e c o m m e r c e

Amadeus
Amadeus (Four European Partners): Founded in 1987 Continental joined in 1995 At the time of writing Amadeus: Is processing for over 469 airlines; Is linked to more than 190,000 terminals; Is based in Germany.

Checkout www.amadeus.net

E-Commerce David Whiteley/McGraw-Hill, 2000

electronic commerce strategy technologies and applications

e c o m m e r c e

Competition and customer loyalty


Airline branding/customer loyalty: Advertisement: United the friendly skies BA the worlds favourite airline Hub operations/connections Loyalty/frequent flyer programs Alliances: Star Alliance/Our World Competition: De-regulation Low cost/no frills carriers

E-Commerce David Whiteley/McGraw-Hill, 2000

electronic commerce strategy technologies and applications

e c o m m e r c e

Web booking systems


The web provides: A new sales channel Less opportunity for price comparison Chance to develop brand loyalty Value-added features can include: Customers Frequent Flyers account online Pre-allocation of seats Online selection of meal options Additional travel services Travel and airport information Access to seat sales/auctions Personalisation of the web site
E-Commerce David Whiteley/McGraw-Hill, 2000

electronic commerce strategy technologies and applications

e c o m m e r c e

Web booking systems


Analysis of airline web sites (1999) With web site (%) North America South America Western Europe Eastern Europe Pacific Asia Africa Average 58 33 42 7 44 23 26 33 With online booking (%) 22 8 12 1 9 3 3 10

E-Commerce David Whiteley/McGraw-Hill, 2000

Details at time of purchase: electronic commerce Time-consuming (if done every time) Sales can be mixed mode: strategy Web enquiry / telephone sales technologies and applications Discuss / Check out some Airline sites
E-Commerce David Whiteley/McGraw-Hill, 2000

e c o m m e r c e

Airline Web sites


Customer Information: Alternatives: Requirement for prior registration Take details when purchase is made Prior registration: Can annoy/put-off customers Might tie customer into site

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electronic commerce Check out some Airline sites for cheap deals: London to New York: strategy Several airports for each city technologies Cheaper tickets may be available on alternative dates and applications

e c o m m e r c e

Airline Web sites


Product (flight) Information: Alternatives: Show Timetables Take date, time and airport details Issues: Knowing airport names / codes Several airports for one city Alternative dates and times

and discuss issues.


E-Commerce David Whiteley/McGraw-Hill, 2000

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electronic commerce strategy technologies and applications

e c o m m e r c e

Airline Web sites


Payment and Delivery: Payment by Credit Card: Security Issues Delivery: By post Collect at airport e-Ticket Discuss issues .

E-Commerce David Whiteley/McGraw-Hill, 2000

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electronic commerce Main options: Telephone airline direct strategy Conventional Travel agent technologies and Online Travel Agent applications Airline web site
E-Commerce David Whiteley/McGraw-Hill, 2000

e c o m m e r c e

Options for booking airline seats


Airline

Booking Sys.

Telephone

Travel Agent

Web

Passenger

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electronic commerce strategy technologies and applications

e c o m m e r c e

Chapter 5 Exercise 1
Check out booking of airline seats online the requirement is for the best price for London to San Francisco out 23 Dec and back 02 Jan. The following sequence of steps is recommended: Use the web to find out a list of carriers that fly the required route. Use two or three airlines to find the cheapest available return flight. Find an online travel agent and check for the cheapest price there.

E-Commerce David Whiteley/McGraw-Hill, 2000

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