Sequential Analysis of Airline Industry in Nigeria

Many wonder about the influence of product /service contents or features on business function. Why do people prefer certain airlines and not others? Some insist on KLM, while others prefer emirates  . Some choose virgin atlantic airways, while some others go for british airways. Yet many people contend that there are no significant differences among well – known airlines. The passengers’ choice may be influenced by the quality of services offered or the attractive price package, or value for money programme. Frequency, the ticket price, in-flight services, punctuality, time schedule, seat comfort and other characteristics combine to project an image to the prospective passenger. Consequently, these features are input element in a marketing programme. The aim of this study is to investigate the factors influencing choice and the extent to which customers are likely to exhibit loyalty in the face of severe price competition. This study explores the change in airline passengers’ preferences in situations where service quality improves. This study is informed by the influx of foreign airlines into Nigeria and the attendant issue of how a prospective buyer takes a decision on which airline to fly. This investigation is conceived with the objective of measuring the effect on airlines the decision variable per passenger’s preferences. The aim is to ascertain how the effect of factors influencing the choice of airline significantly improves the marketing strategies employed by these airlines. This research problem is undertaken by utilizing an approach which involves a literature review to identify key construct and a survey. The information gathered are then used in the development of a questionnaire. The key issues influencing the choice of airline are identified. In other to test the hypothesis, that ‘value for money’ acts a s key decision variable, a survey of customers is conducted using a convenient sample of respondents who have been responsible for purchasing airline tickets for themselves to undertake international travel in the prior twelve months. Respondents rate the importance of a variety of issues relating to airlines choice. A factor analysis of these items is then carried out using a varimax rotation. Under the advance exploratory analysis, a multivariate analysis of variance is therefore undertaken to analyze the impact of some of these determining factors on likelihood to fly on an airline. The analysis shows that the two top factors affecting passengers’ choice of airline are â€Å"schedule of the time† and â€Å"safety†. The actor of seat comfort is ranked fourth by the total number of passengers. The analysis of pasenger’s satisfaction tells us the quality of airline services that passengers actually received. The result shows that â€Å"seat comfort† is ranked far behind the other eight factors, indicating that the service quality that passengers received is below average. Under the choice model, the sign of price is negative implying that the passengers prefer the airline with lower ticket to that with the higher ticket fare which is identical with normal expectation. The sign of seat type is positive which indicate passengers’ actually view seat comfort as an important factor in their choice decision. The above findings show that this market segment currently lacks loyalty and is driven solely by price related features. It may therefore be necessary for airlines to undertake further investigation that allows them to develop strategies and packages that particularly target the need of this group.