Ecommerce n passenger transport
CASE STUDY: E-COMMERCE IN PASSENGER TRANSPORT
Summary
Passenger air transport was one of the early users of e-commerce, in this case electronic markets. Early innovations of airline booking systems, such as United and American Airlines, gained competitive advantage from the deployment of their systems and even after the elimination of various anti-competitive features, continued to gain significant business value .The use of airline booking systems by travel agents gave access to wealth of information and was an important element in creating what is a now fiercely competitive market in air travel.
With the advent of Internet e-commerce, the air transport industry is again at the forefront of e-commerce developments with each of the larger airlines providing for on-line bookings and, in many cases, linking this into their frequent flyer programs and electronic check-in facilities at the airport.
The Internet e-commerce developments have the potential to once again restructure the market. A move away from the direct use of airline booking systems could de-emphasize price competion. A shift to direct online booking also threatens the role of the travel agent as an intermediary but possibly opens the market fro a new breed of online intermediaries.
Choices
For anyone wanting to travel across the Atlantic: London to New York, Washington o Paris or Toronto to Frankfurt; what us the choice. At one level there is a lot of choice. That is the choice between British Airways (BA), United, Air France, American Airways (AA), Lufthansa etc. and each of these airlines would like you to see them as a superior product, your preferred option. However, whatever the airlines name the offering is much the same –a cramped seat, plastic food and a cut-down movie in a standard metal tube with wings on it(or if one pays four times as much for first class cut- a big seat, plastic food served on china and a choice of cut-down movies). For many customers, the real choice between
Summary
Passenger air transport was one of the early users of e-commerce, in this case electronic markets. Early innovations of airline booking systems, such as United and American Airlines, gained competitive advantage from the deployment of their systems and even after the elimination of various anti-competitive features, continued to gain significant business value .The use of airline booking systems by travel agents gave access to wealth of information and was an important element in creating what is a now fiercely competitive market in air travel.
With the advent of Internet e-commerce, the air transport industry is again at the forefront of e-commerce developments with each of the larger airlines providing for on-line bookings and, in many cases, linking this into their frequent flyer programs and electronic check-in facilities at the airport.
The Internet e-commerce developments have the potential to once again restructure the market. A move away from the direct use of airline booking systems could de-emphasize price competion. A shift to direct online booking also threatens the role of the travel agent as an intermediary but possibly opens the market fro a new breed of online intermediaries.
Choices
For anyone wanting to travel across the Atlantic: London to New York, Washington o Paris or Toronto to Frankfurt; what us the choice. At one level there is a lot of choice. That is the choice between British Airways (BA), United, Air France, American Airways (AA), Lufthansa etc. and each of these airlines would like you to see them as a superior product, your preferred option. However, whatever the airlines name the offering is much the same –a cramped seat, plastic food and a cut-down movie in a standard metal tube with wings on it(or if one pays four times as much for first class cut- a big seat, plastic food served on china and a choice of cut-down movies). For many customers, the real choice between