The Business Travel Market

Topic: TravelTransport
Sample donated:
Last updated: June 18, 2019

The traditional stereotype of business traveler of being male and middle-aged (41 year- old is the average).

•Women are becoming much important in business travel; by 2010 25-30% of all business travel will be under taken by women. •Wealthy Individuals/ highly income •Experts, familiar with the standards offered by different airlines, and able – and willing – to make comparisons between them. Psychographics •Having strong opinions, and preparing to communicate these opinions. Their attitudes vary through time, with a pronounced life cycle effect often discernible The Leisure Segment of Demand Demographic •Males and females, with leisure travel by older people (aged over 65) •Families (encompasses all ages) •Average personal income (middle to upper class) •Required for cheap air fare Economic Growth and Trade Cycle The demand for air travel is characterized by very high income elasticity. Therefore, as the world economy grows especially international trades, the demand for air travel can be expected to increase too.This continuing growth gives both enormous opportunities and great challenges to the airline industry. The challenges are to accommodate the growth through suitable infrastructure development and without unacceptable environment consequences, and exploit the demand whilst achieving the stable profits which industry has often found elusive.

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Moreover, air transport industry growth rates are tied closely to those in the world economy. If growth in the economy is rapid in a particular year, so is the increase in air travel demand. Unfortunately, the industry’s past record is not encouraging.

Too often, many airlines over-invest in additional capacity. They have also commonly given too much emphasis to the First and Business Class market, a market which trends to be very strong when times are good, but which suffers particularly severely during a downturn. A final problem often is that in upswing periods, insufficient attention may be given to the control of costs especially labor coats. Eventually, the organization will be forced down because of an overcapacity situation, to levels which do not allow costs to be covered.

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