Cus­tomiz­ing is the buzz­word for air­lines in or­der to avoid ‘tur­bu­lence’

China Daily (Hong Kong) - - HK - PETER LIANG

The busi­ness out­look for most re­gional air­lines is any­thing but bright de­spite pro­jec­tions of steady tourism growth.

The In­ter­na­tional Air Trans­port As­so­ci­a­tion has pre­dicted that to­tal prof­its of air­lines in the Asia-Pa­cific re­gion will dip nearly 14 per­cent in 2017 to $6.3 bil­lion. This has led Nick Evered, se­nior vice-pres­i­dent and gen­eral man­ager at travel and ex­pense man­age­ment firm Con­cur to query in a news­pa­per ar­ti­cle: “Is it just a mat­ter of get­ting through the eco­nomic dol­drums or there’s some­thing more fun­da­men­tal that’s awry?”

That “some­thing” is tech­nol­ogy, which is forc­ing air­lines to fun­da­men­tally al­ter their way of do­ing busi­ness by be­ing more re­spon­sive to the spe­cific needs of in­di­vid­ual cus­tomers. This is the new area that an in­vestor should look for in air­line stocks.

The first thing to look for is whe ther the car­rier has de­vel­oped al­ter­na­tive means of sell­ing tick­ets. The old sys­tem of re­ly­ing on travel agents has bro­ken down be­cause the in­ter­net has made it eas­ier for trav­el­ers to book flights them- selves, and most of them do.

There’s no short­age of web­sites for book­ing flights. The key chal­lenge fac­ing air­lines is to find ways to win back cus­tomers by be­com­ing full-ser­vice re­tail­ers. To do that, they have to be flex­i­ble in cater­ing to the spe­cific needs of in­di­vid­ual clients.

For in­stance, a cus­tomer may want to fly from Hong Kong to Shang­hai on busi­ness class. But, he or she can do with­out the meal and the ex­tra lug­gage. Some car­ri­ers have al­ready be­gun of­fer­ing trav­el­ers mul­ti­ple op­tions to cus­tom­ize their travel needs and costs.

Nearly all air­line com­pa­nies run web­sites for cus­tomers to book their flights and at­tend to a host of other travel-re­lated mat­ters. But, they need to of­fer more op­tions, or cus­tomers would hunt for the cheap­est flights on Ctrip or any other travel-ser­vice provider which em­pha­sizes ef­fi­ciency and bar­gains.

The will­ing­ness and ca­pa­bil­ity of re­gional air­lines to cus­tom­ize is cru­cial to their suc­cess. Be­fore you buy air­line stocks, get into their web­sites and check how many op­tions you have in cus­tomiz­ing your travel ex­pe­ri­ence and bud­get.

Be­fore you buy air­line stocks, get into their web­sites and check how many op­tions you have in cus­tomiz­ing your travel ex­pe­ri­ence and bud­get.”

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