Airline brand choice in a duopolistic market: The case of New Zealand

• Published in: Transportation research. Part A, Policy and practice Policy and practice, 2019-03, Vol.121, p.147-163
• Main Authors: Henderson, Isaac Levi, Tsui, Kan Wai Hong, Ngo, Thanh, Gilbey, Andrew, Avis, Mark
• Format: Article
• Language: English
• Subjects: Airline marketing; Behavioural loyalty; Brand choice; Double jeopardy; Duopolistic markets; Self-generated validity
• ISSN: 0965-8564; 1879-2375
• DOI: 10.1016/j.tra.2019.01.016

•Examines airline brand choice in a duopolistic airline market.•An alternative methodology is proposed to avoid issues of self-generated validity.•‘Double jeopardy’ is used to explain surprising and anomalous findings.•Price, time and reliability predict real airline brand choices. This study examines how consumers choose between airlines for domestic flights within New Zealand, where there are only two major airlines, a full-service carrier (FSC) and a low-cost carrier (LCC). Using semi-structured qualitative interviews, information about 209 participants’ most recent domestic flights is elicited. The authors identify the reason(s) behind why passengers chose their airline (i.e., post-consumption) as well as the important factor(s) in determining which airline they will fly on in the future (i.e., pre-consumption). There are 11 major reasons (post-consumption), and 10 major important factors (pre-consumption). These are associated with gender, age, occupation, citizenship, travel characteristics (frequency, recency and purpose) and whether the flight was for/from international transit. Probit regressions are used to predict airline choice based upon the pre-consumption and post-consumption themes, respectively. The findings suggest that airline managers should focus on market penetration through fundamental airline attributes (price, time and reliability) to grow market share.