Harmonizing to a study on Asia-Pacific travellers in 2005 by Tax Free World Association ( TFWA ) , 93 % of these consumers purchased a luxury or branded point while going, out of which 10 % of these consumers would hold purchase an point onboard the plane. The inflight catalogue placed behind the rider ‘s place may look insignificant to the general population, but it is in fact a large concern in the universe of travel retail. Inflight travel retail is a superstore onboard the plane, supplying a broad array of points that riders can buy at monolithic price reductions ( up to 40 % off metropolis monetary values ) , travel scoops and all at their convenience while winging to their finish.
Airlines and consumer goods companies are aiming at this market section to increase their gross. Understanding consumer behaviour and rider profile allows these sellers to use their resources efficaciously. This thesis undertakes a selling research attack with the purpose of utilizing the consequences to better the effectivity of selling activities for inflight retail merchants.
In 2012, Singapore Airlines ( SIA ) was awarded the Best Inflight Retailer in the Asia-Pacific Airline Retail Conference ( SIA, 2012 ) , voted by delegates from the air hose retail conference. This is nevertheless non brooding of its gross revenues volume or riders ‘ satisfaction. Despite strong acknowledgment given to SIA for its first-class inflight retail services by professional retail merchants, inflight travel retail has non been the focal point of SIA ‘s operations lest any reference in its one-year study. On the contrary, Cathay Pacific ( CX ) , a 5-star air hose in the Asia-Pacific part based in Hong Kong, has a dedicated squad of specializers that focus on its booming in-flight gross revenues plan ( Salian, 2010 ) . Unlike CX, the inflight retail onboard SIA is externally operated by DFASS under the retail merchant named Kris Shop ( KS ) . DFASS is a transnational concessioner supplying the concern theoretical account, selling schemes, stock list and preparation to selling crew in SIA ( DFASS, 2013 ) .
This research investigates how consumer behaviour affects in-flight travel retail gross revenues. Consequences from this research will supply penetration for consumer goods retail merchants and air hoses to increase in-flight travel retail gross revenues.
What is the rider profile of SIA?
What are the selling schemes that Kris Shop use to increase inflight travel retail gross revenues?
How does consumers ‘ behavior affect inflight travel retail?
How can companies increase their inflight travel retail gross revenues?
This survey aims to
To find rider profiles of SIA
To place the selling schemes applied by Kris Shop
To set up the relationship between consumers ‘ behavior and inflight travel retail
To propose future selling directives for inflight travel retail
The research range specifies outbound riders from Singapore who fly with SIA.
Cardinal to this research theoretical account ( figure 1 ) is consumer behaviour. Consumer behaviour is influenced by endogenous and exogenic factors ( Lane and Piercy, 2004 ) . Endogenous factors are psychological influences such as motive, perceptual experience and attitude. Exogenous factors include socioeconomic, cultural and group influences. Passenger profiling is a aggregation of quantitative information ( Teichert, Shehu and Wartburg, 2008 ) . Data typically include socioeconomic position, attitude and penchants of riders. Review of current selling schemes applied by inflight retail merchants provides a mention to compare consumer ‘s penchants and what is presently being offered. Hence the spread between riders ‘ outlooks and bing selling scheme would supply penetrations for sellers to better selling effectivity therefore increasing inflight travel retail gross revenues.
Inflight Travel Retail Gross saless
Figure 1: Proposed research theoretical account
A focussed reappraisal on inflight travel retail, rider profiling, selling schemes and consumer behaviour was conducted for this thesis proposal.
Inflight travel retail
Many air hoses now derive more income from their on-board commercial activities than from their conventional transit concern. Inflight travel retail has become a cardinal importance to the fight and long-run endurance of the air hose industry ( Kerby, 2010 ) . Experts in this field noted that riders tend to pass more when they are winging, boosted by the vacation temper unlike how price-sensitive riders are when it comes to airfares ( Straits Times, 2010 ) . Airlines are viing through advanced ways to spread out their in-flight gross revenues by prosecuting engineering and retailing to the land ( DFASS, 2013 ) . While most inflight shoppers purchases were pre-planned, in-flight shoppers tend to be more unprompted, more trade name witting, more price-conscious, less hazard perceptive and possess a positive attitude towards publicizing than non-shoppers ( Huang and Kuai, 2006 ) . However, a hunt on databases including JSTOR, ProQuest and ScienceDirect found limited literature on consumer behaviour and selling schemes act uponing inflight travel retail gross revenues, therefore this thesis survey is proposed.
Teichert, Shehu and Wartburg ( 2008 ) found that air hose riders can be classified as four classs as illustrated in figure 3. They besides proposed that marketing schemes for the customized merchandise bundles should be aligned to the attitudes and socio-demographic profiles taking to a specific set of penchants in the several client sections. Balan ( 2007 ) besides suggest that organisation ‘s client profiling should be done by analyzing purchasing behaviour, life style and client value.
Figure 3: Categorization of air hose riders
The selling procedure includes understanding the market place and consumers, planing a customer-driven selling scheme and incorporate selling mix ( Kotler et. al. , 2009 ) . Swarbroke and Horner ( 2007 ) suggest that marketing activity should concentrate on accommodating merchandise offering to peculiar fortunes of mark section demands and wants. Wunker ( 2011 ) further recommends cardinal levers to marketing schemes including unsymmetrically assailing rivals, procuring distributers, stress new fiscal expressions and develop staff competences suited for the environment. Hence selling schemes should be closely associated with consumer behaviour and staying competitory in the concern environment.
Understanding consumer behaviour allows manufacturers and sellers to bring forth the right merchandise and sell them with selling schemes that would appeal to consumers. Foxall and Goldsmith ( 1994 ) suggested a sequence of problem-solving phases in consumer behaviour as illustrated in figure 2.
Figure 2: Consumer behaviour in problem-solving phases ( Foxall and Goldsmith, 1994 )
Researchers divide grounds for purchase into hedonistic and useful motives. Hedonic ingestion involves a multisensory, phantasy and affectional responses with one ‘s purchase, whereas useful ingestion is motivated by a undertaking with merchandise acquisition as a end ( Huddleston and Minahan, 2011 ) . Swarbroke and Horner ( 2007 ) argued that consumer perceptual experience is all that affairs as it determines their existent behaviour, hence, organisations need to understand consumer ‘s perceptual experience about single merchandises. Percepts are nevertheless beyond the control of retail merchants and manufacturers and can sometime be based on a anterior experience ( Huddleston and Minahan, 2011 ) . Hensher, Louviere and Swait ( 1999 ) proposed that consumer ‘s declared penchants enable probe of new merchandise characteristics or combinations of characteristics which do non yet exist in the market. Geuensa, Vantommeb and Brengmanc ( 2004 ) besides found that travelers can be incited to devour by environmental factors. Hence sellers can work on environmental factors to act upon consumer behavior. Across civilizations, consumers who are more collectivized are likely to be more satisfied with an impulse purchase when another individual is present at clip of purchase compared to more individualistic consumers ( Kacen and Lee, 2002 ) . Keeping other factors changeless, Asia-Pacific travelers who come from more collectivized society are likely to be more satisfied than travelers from other parts. Travelers besides valued the public-service corporation and souvenir features of merchandises, ranking brand-name, public-service corporation, and low-priced merchandises as factors lending to consumer satisfaction ( Perng, Chow, and Liao, 2010 ) .
Research methodological analysis and scheme
There are two attacks to research, inductive and deductive. An inductive research is by pulling a decision from an empirical survey by detecting and generalising from a set of informations while a deductive attack refers to a procedure of pulling decisions from other propositions or from informations on the footing of logical logical thinking ( Boyce, 2002 ) . Four research schemes are illustrated in figure 3.
Conducted for a job that has non been clearly defined
Describes features of the phenomenon
Establish causal relationship between variables
Triangulation of consequences by utilizing different methods at different junction of the research procedure
Figure 3: Features of the four research schemes
Research methodological analysiss can be classified into two classs, quantitative and qualitative. Qualitative attack involves garnering a big sum of informations about a little figure of topics, it assumes that world is socially and subjectively concept and the research worker has to bring out significances instead than proving hypothesis ( Veal, 2005 ) . Qualitative research can be used to explicate personal experiences of persons, focal point on topics ‘ ain apprehension and readings, and are presented in a narrative signifier which makes it more interesting for non-experts. The methods used to garner qualitative information include observation, informal, unstructured and in-depth interviewing, and participant observation ( Veal, 2005 ) .
Quantitative research involves the assemblage and analysis of statistical informations where research workers use numerical grounds to pull decisions or trial hypotheses ( Veal, 2005 ) . Relatively big figure of topics is necessary to guarantee dependability of the consequence and analysis of the informations is normally done by computing machine package. Hence the sample survey represents a larger population and consequences are generalizable. Data beginnings include questionnaires-based, studies, from observation or from secondary beginnings, such as gross revenues informations ( Veal, 2005 ) .
Proposed research method
Based on the research methods identified above, a deductive attack, explanatory scheme and quantitative method shall be selected and used for the thesis.
Secondary informations is defined as bing fact and figures that are available for people to entree and usage ( Boyce, 2002 ) . Such informations are indispensable in any research procedure, specific in the research design, enables researcher to guarantee the cogency and dependability of their survey. It is cheap and easy accessed compared to primary informations.
Most market research embarks on obtaining primary informations through studies, focal point groups and in-depth interviews. Surveies can be used to measure sentiments, perceptual experiences and attitudes ( Glatthorn and Joyner, 2005 ) . A study questionnaire collects quantified informations for determination devising, provides transparence, presents information compactly, possess comparison and gaining controls complexness ( Veal, 2005 ) . Administration of standardised study questionnaires is besides an economical manner to roll up big sum of informations. In focal point groups and in-depth interviews, little Numberss of carefully selected people give their sentiments in item in an informal and unstructured scene ( Boyce 2002 ) . Collection of primary informations is normally more dearly-won and time-consuming than secondary informations.
Proposed informations aggregation
This thesis would necessitate both primary and secondary beginnings of informations. A questionnaire shall be used as it is good for explanatory research ( Veal, 2005 ) . The questionnaire would dwell of inquiries that include personal profile, self-reported purchasing behaviour and disbursement capacity. The questionnaire will take the signifier of a self-administered online study and confined group studies from SIA riders through travel bureaus and on board the flights. Respondent-completion questionnaires are cheaper, faster and comparatively anon. ; nevertheless it risks frivolous response ( Boyce, 2002 ) . Secondary informations would include observations of the selling schemes applied by DFASS, gross revenues studies and literature on consumer behaviour and travel retail.
Sampling helps to find the corresponding value of the population and is indispensable in marketing research ( Bryman and Bell, 2007 ) . SIA flies about 17million riders each twelvemonth ( SIA, 2012 ) . Although a larger sample would be more accurate and generalizable in its findings, it is impossible to study all 17million riders winging by SIA. Thus the sample population is framed as SIA riders who travel outbound from Singapore during the period of study with sample size of minimal 200 respondents. This figure is derived by using the conventional attack, which is the mean size of marketing research surveies. Due to clip and fiscal restraints of the thesis, a convenience trying method is therefore selected.
Datas can be loosely classified as categorical and quantifiable ( Bryman, and Bell, 2007 ) . A likert graduated table will be used to roll up categorical informations such as penchant of retail merchandises and selling schemes. The collected information from the study questionnaires would so be statistically analyzed to prove the hypotheses utilizing SPSS ( Statistical Package for Social Science ) .
The findings will be presented utilizing saloon charts to show the riders ‘ profile, consumer penchants and pie chart to demo the dislocation of gross revenues points in DFASS and other informations figures to back up the thesis.
Validity and dependability
Dependability is defined as the grade of stableness exhibited when a measuring is repeated under indistinguishable conditions ( Veal, 2005 ) . Cogency refers to the extent to which the measuring process really measure the construct that is intended to mensurate ( Veal, 2005 ) . The purpose of the survey is to set up the relationship between consumer behaviour and inflight travel retail gross revenues. Hence cross-index of primary and secondary informations such as past experiments can assist to find the dependability of findings. The study questionnaire will dwell of graduated tables for respondents to take their best response that would be valid for sellers to utilize these consequences in implementing successful selling schemes.
Entree to riders requires coaction with external organisations, viz. SIA, DFASS and travel bureaus. The research worker will hold to budget for sufficient clip to pull up a proposal structured such that the survey can assist to understand its riders ‘ purchasing behaviour and hike SIA ‘s inflight travel retail gross revenues. Survey questionnaires can be distributed by travel bureaus and collected by station, emailed to SIA riders who purchase tickets online and administrating the questionnaire in a confined group of riders on board the plane who fly outbound Singapore via SIA.
A self-administered study questionnaire will guarantee namelessness and reassurance shall be rendered for on-line answers. In add-on, respondents ‘ information will be kept confidential as per university guidelines.
Proposed thesis agenda
Devise research attack
Draft research scheme and method
Pilot trial and revision questionnaire
Write in to companies
Update literature read
Complete staying chapters
Submit to supervisor for feedback
Revision and finalise thesis