In many organisations, air travel is an essential part of conducting business in order to meet company objectives and goals. The selection of a preferred airline is a complex undertaking. Corporations may obtain discounts based on expenditure commitments; the airline may have a frequent flyer programme; or a low cost carrier may offer a better alternative to full service carriers. The literature on corporate travel is fairly limited with determinants determining the selection of airlines having been studied from other perspectives such as the business traveller, thus, this study should make a significant contribution to this field by generating new information on corporate travel and in particular corporate air travel decisions. The literature review provides a demarcation of the broad concepts of the buying approach towards corporate air travel. Also discussed is the relationship between the key role players in airline selection: the corporate traveller; the travel management company; and the airline. Various determinants of airline selection by corporations are identified and the role of frequent flyer programmes is analysed. Furthermore, the move towards low-cost airlines as a preferred choice for corporate travel is investigated. The empirical phase of the research study focussed on identifying the determinants of airline selection by large-sized corporations in South Africa; the relative importance of frequent flyer programmes; and the move towards low-cost airlines as a preferred choice for corporate travel. The target population was sampled using a non-probability convenience sampling approach with a newly designed quantitative, ex post facto web-based questionnaire, distributed via e-mail to the target population. Exploratory factor analysis was done to identify whether an underlying structure of airline selection determinants exists from which the relative importance of frequent flyer programmes could be assessed. From the results, a model of corporate airline selection determinants was derived. Then, the model was compared to the conceptual model formulated from the literature survey. A number of important selection determinants were identified, and it became evident that frequent flyer programmes are, generally, not considered a decisive determinant in the selection of a preferred airline by corporations. However, the influence of low-cost airlines was shown to be considerable, in line with the endeavour to save on air travel expenses within a corporate air travel management programme. The findings should assist both corporations and airlines with the design of their air travel buying approaches and marketing strategies respectively. / Dissertation (MCom)--University of Pretoria, 2010. / Tourism Management / Unrestricted

Thesis (MBA (Business Management))--University of Stellenbosch, 2009. / ENGLISH ABSTRACT: The purpose of this report is to provide detailed insights into the marketing of services, specifically in the airline and travel agency industries. Therefore, the report firstly presents the existing literature, narrowing down the view from the traditional marketing approach with the 4P to the 7P approach for service marketing. As a final step, the few sources on airline and travel agency marketing are evaluated to identify gaps in the current research. Following this overview, the report explains the current situation within the airline and travel agency industries. The players in these markets currently face significant challenges, namely the competitive structure, changing booking behaviours, increasing competition of low-cost airlines, the rise of oil prices, increasing activities for environmental protection, structural problems of the major aircraft manufacturers, the open skies agreement between Europe and the US, and the current economic crisis. In order to successfully compete in this challenging environment, airlines as well as travel agencies need to understand the needs and preferences of their potential customers very clearly. Consequently, the researcher conducted a survey amongst passengers from Germany to South Africa in order to gain information on these preferences. This questionnaire aims to clearly identify the major decision-making factors of the passengers when choosing an airline or booking channel. Knowledge regarding these decision-making factors enables companies to design their offering in a way that the needs and preferences of passengers are optimally met, while the airline or travel agency can still operate profitably. The survey was posted online and 185 respondents across all age groups participated. The main insights of the results are that the price clearly is the dominant decision-making factor for both the choice of the airline and the choice of the booking channel. Furthermore, several hypotheses, which could be extracted from the literature, are tested. It is found that for travel agencies, the consulting services do not have any significant impact on the decision of the passengers. Their perceived competency, however, does play a reasonably important role and is consequently a factor that needs to be considered by travel agencies when designing the offer. For airlines, the flight schedule clearly constitutes the second most important factor. While the brand is at least considered fairly important, frequent flyer programmes, as well as the membership in an alliance, are not considered to be important at all for the decision of the airline. The report nevertheless explains why the membership in an alliance does, in reality, have significant positive effects on the performance of an airline, specifically through the positive impact on operating cost and improvements in the flight schedule. As a final step, the results are compared to a similar survey conducted by Wise Research Ltd. (2008: 3) and Lufthansa (Euler, 2005: 8). It is found that there are only slight variances between the results. A possible explanation for the variances could be that the economic environment has changed. Also cultural differences and differences between short- and long-haul flights are considered. / AFRIKAANSE OPSOMMING: Hierdie verslag het die verskaffing van gedetailleerde insig in die bemarking van dienste ten doel, spesifiek in die lugredery- en reisagentskapbedrywe. Daarom bied die verslag eerstens die bestaande literatuur aan, terwyl die beskouing van die tradisionele bemarkingsbenadering met die 4P- tot die 7P-benadering vir diensbemarking vernou word. Laastens word die enkele bronne wat lugredery- en reisagentskapbemarking behandel, geëvalueer om leemtes in die bestaande literatuur te identifiseer. Na hierdie oorsig, verduidelik die verslag die huidige situasie in die lugredery- en reisagentskapbedrywe. Die rolspelers in hierdie markte kom voor beduidende uitdagings te staan, naamlik veranderende besprekingsgedrag, toenemende mededinging van laekoste-lugrederye, stygende oliepryse, toenemende optrede vir omgewingsbeskerming, strukturele probleme van die vername vliegtuigvervaardigers, die Oop Lugruimooreenkoms (Engels: Open Skies agreement) tussen Europa en die VSA, en die huidige ekonomiese krisis. Om suksesvol in hierdie uitdagende milieu mee te ding, moet lugrederye en reisagentskappe die behoeftes en voorkeure van hul moontlike kliënte baie duidelik begryp. Gevolglik het die navorser ʼn opname gemaak onder passasiers onderweg van Duitsland na Suid-Afrika om inligting omtrent hierdie voorkeure in te samel. Hierdie vraelys het beoog om die vername besluitnemingsfaktore van passasiers te identifiseer wanneer hulle ʼn lugredery of besprekingskanaal kies. Kennis omtrent hierdie besluitnemingsfaktore stel maatskappye in staat om hul aanbieding so te ontwerp dat die behoeftes en voorkeure van passasiers optimaal nagekom word, terwyl die lugredery of reisagentskap steeds winsgewend bedryf kan word. Die opname is aanlyn geplaas en 185 mense vanuit alle ouderdomsgroepe het deelgeneem. Die hoofinsigte van die resultate is dat prys duidelik die oorheersende besluitnemingsfaktor in beide die keuse van lugredery én die keuse van besprekingskanaal is. Verder is verskeie hipoteses wat vanuit die literatuur onttrek kon word, getoets. Vir reisagentskappe word daar bevind dat die konsultasiedienste geen beduidende invloed op die besluitneming van passasiers het nie. Daarteenoor speel hul vermeende bekwaamheid ʼn redelik belangrike rol en is gevolglik ʼn faktor wat deur reisagentskappe oorweeg moet word wanneer die aanbieding ontwerp word. Vir lugrederye is die vlugskedule duidelik die tweede belangrikste faktor. Terwyl die handelsmerk as minstens redelik belangrik beskou word, word gereëlde vlieërprogramme, asook die lidmaatskap van ʼn assosiasie, glad nie as belangrik beskou vir die keuse van lugredery nie. Die verslag verduidelik hoekom die lidmaatskap van ʼn assosiasie nieteenstaande in werklikheid beduidende voordelige invloede op die prestasie van ʼn lugredery het, spesifiek deur die voordelige invloed op bedryfskostes en verbeterings aan die vlugskedule. In ʼn finale stap word die resultate vergelyk met dié van ʼn soortgelyke opnames gemaak deur Wise Research Ltd. (2008: 3) en Lufthansa (Euler, 2005: 8). Daar word bevind dat daar slegs klein verskille in die bevindinge voorkom. ʼn Moontlike verduideliking van die verskille is dat die ekonomiese milieu verander het. Kulturele verskille tussen kort en lang afstand vlugte word ook oorweeg.