p align = “center” editor’s note
in order to implement the 2022 civil aviation work policy of “keeping the bottom line, stabilizing expectations, strengthening the foundation, tapping potential, improving quality and efficiency and innovating performance” determined by the Party group of CAAC, provide reference for civil aviation enterprises to adjust and optimize their operation and management strategies under the epidemic, and better promote the industry to tide over difficulties and recover development, the comprehensive Department of CAAC, China Air Transport Association China Civil Airport Association recently jointly sponsored the essay solicitation activity of “civil aviation operation and management under the epidemic”. This newspaper has set up a special column to publish the excellent articles of the activity, so as to contribute wisdom to accelerating the recovery and development of the industry and striving to turn losses into profits. Please pay attention
The outbreak of covid-19 pneumonia in 2020 has profoundly changed the development pattern of China’s civil aviation. Affected by the epidemic, the original passenger sources in the first and second tier markets have been greatly reduced, and civil aviation enterprises are generally faced with the difficulties of insufficient passenger sources and declining economic benefits. However, the sudden epidemic situation is also like a sobering agent, reminding the majority of civil aviation transportation enterprises to focus on the broader third and fourth tier markets. There are still nearly 1 billion people in China who have not flown, most of them in third and fourth tier cities. According to the statistics of the Civil Aviation Administration, China’s new aviation population in 2021 was 3536, of which 53% came from third and fourth tier cities, showing huge growth space. At present, the country is speeding up the construction of a new development pattern of “Taking China’s big cycle as the main body and China’s international double cycles promote each other”. As an important part of China’s big cycle, the third and fourth tier cities will be the focus of civil aviation transportation enterprises in the next step of “opening up territory”.
In order to help airlines speed up the expansion of the third and fourth tier aviation market, Hubei airport group, together with airlines such as Air China, China Southern Airlines and Shandong Airlines, OTA platform and Hubei passenger transport group, accelerated the construction of a sales and publicity network and collection and distribution service system with Wuhan airport as the core in Hubei Province, comprehensively improved the passenger travel experience of third and fourth tier cities in Hubei Province, and made beneficial exploration for promoting the sinking of China’s aviation market. The relevant practice and thinking are summarized as follows:
I. pain points of post epidemic market sinking
(I) pain points from the perspective of passengers
From the perspective of passengers in the third and fourth tier cities, there are the following pain points in air travel at present:
\u3000\u30001. The price is on the high side
Most of the passengers in the third and fourth tier cities in the province are ticket price sensitive passengers. As long as the ticket price is cheap, it will stimulate their consumption desire to travel by air. In particular, many passengers have never been on a plane and are eager to have the opportunity to experience the fun of flying. At present, the marketing focus of many aviation enterprises operating in Wuhan is still mainly in big cities such as Wuhan. They do not pay high attention to the aviation market in the third and fourth tier cities in the province, and do not launch preferential ticket products. At present, the average seating rate of inbound and outbound flights in Wuhan airport is about 80%, and the remaining 20% of seats have not been sold. According to the current daily average of 580 passenger flights and 170 seats per flight in Wuhan airport, 19700 seats are wasted every day. If airlines can create air travel products with preferential prices specifically for the third and fourth tier cities in the province, it will effectively stimulate the potential huge consumer market, greatly improve the flight occupancy rate and increase the flight revenue.
\u3000\u30002. Poor ground transportation. At present, the ground vehicles from the third and fourth tier cities in Hubei Province to Wuhan airport are mainly cars. Although Wuhan airport has set up 12 urban terminals in Hong’an, Guangshui, Xiaogan and other places, these urban terminals mainly serve the local market. The market radiation is narrow, and the number of regular trains is small. Many passengers from third and fourth tier cities still feel inconvenient to fly to Wuhan airport.
\u3000\u30003. The service process is not familiar. At present, many passengers in the third and fourth tier cities are first-time passengers. They are not familiar with the air travel processes such as check-in, security check-in and boarding. They think that the air travel process is cumbersome and not convenient to take the train.
(II) pain points from the perspective of airlines
\u3000\u30001. The market sinks and the channel is narrow. In the subconscious of passengers in the third and fourth tier cities, air travel is still a “luxury”, with high ticket prices and low consumption. In fact, in the post epidemic era, airlines often launch special fares. However, due to the lack of effective sales channels, the information of these special products could not be transmitted to the third and fourth tier aviation markets in the province in time, missing potential sales opportunities.
\u3000\u30002. It is difficult to accurately identify passengers. At present, airline ticket sales are mainly online. If preferential prices are introduced for the third and fourth tier markets, it may have an impact on the original market price system. Therefore, accurately identifying passengers in the third and fourth tier markets has become a difficulty for airlines to promote the sinking of the aviation market.
II. Measures to accelerate market sinking
In view of the above market development pain points, Hubei airport group gives full play to the platform advantages of Wuhan airport, actively integrates the four advantageous resources of the airport, Ctrip, provincial passenger transport group and airlines, and cooperates with each other to speed up the establishment of aviation market sales channels and ground transportation service system in all counties and cities of the province in accordance with the idea of “airport platform, Ctrip network channel construction, aviation enterprise design products and provincial passenger transport group service”, As soon as possible, “aviation products sink, aviation services sink and aviation publicity sink”.
(I) launch preferential ticket products
\u3000\u30001. Preferential ticket products. Hubei Airport Group has coordinated with many airlines to design and launch special ticket products for the third and fourth tier markets in the province to meet potential consumer demand. For example, Shanhang Airlines has launched direct discounts for passengers in third and fourth tier cities, and passengers in third and fourth tier cities can directly reduce the applicable ticket price by 20 yuan to 50 yuan when purchasing tickets.
\u3000\u30002. Value-added package products. In order to avoid the impact of ticket products for third and fourth tier cities on the original price system of airlines, Shan Airlines adopts the mode of bundled sales of ticket and ground transportation products for passengers in third and fourth tier cities, so as to accurately lock in the target customer group, and separately launched air to ground intermodal products in the third and fourth tier target markets in the province to attract target customers to buy tickets and take the opportunity.
(II) accelerate the construction of perfect marketing channels
Ctrip gives full play to the channel advantages of 330 stores (including Ctrip, qunar and PepsiCo) in counties and cities of Hubei Province, strengthens the promotion of aviation products in third and fourth tier cities, and guides offline passengers to travel by plane. At the same time, each Ctrip store not only provides ticket booking services, but also provides passengers with flight query, check-in and airport pick-up and other services to improve the service functions. In addition, each store scrolls through the display screen to display the information of special aviation products to guide passengers to choose air travel.
(III) comprehensively promote the construction of provincial collection and distribution system
Based on Ctrip’s network of tourism stores in the province, Hubei passenger transport group has accelerated the construction of a convenient aviation ground service transportation network accessible to the whole province.
It is planned to select a Ctrip store with the largest sales scale in cities across the province as the local flagship store, and the provincial passenger transport group will be responsible for opening the airport line directly to Wuhan airport. At the same time, the flagship store will be used as a regional hub node to cooperate with travel platform companies such as Changjiang Yuntong group to provide passengers with ferry services from home to regional hub nodes, so as to establish an airport collection and distribution service system with trunk and branch connections, Provide “door-to-door” travel services for passengers. When the conditions for the next step are ripe, the provincial passenger transport group can also provide passengers with value-added services such as baggage pre consignment, so as to improve the convenience of passengers’ travel.
(IV) optimizing flight service process
Hubei airport group works closely with airlines to launch convenient check-in services for first-time passengers from third and fourth tier cities, such as special guidance, special check-in counters, fast security channels, etc., so as to comprehensively improve passengers’ check-in experience.
(V) strengthen marketing publicity
Hubei city group tiktok and Ctrip are increasing the marketing capabilities of sunken aviation products through publicity channels such as newspapers, radio, WeChat, jitter and so on, so that more three or four line city passengers can understand the advantages and convenience of taking advantage of the opportunity.
III. analysis of the advantages of the Quartet cooperation model based on Porter’s diamond theory
Porter’s diamond theory is put forward by Michael Porter, a famous strategic management scientist at Harvard Business School in the United States. It is used to analyze why a certain industry in a country or region has strong competitiveness. The theory holds that the competitiveness of a certain industry in a country or region is determined by four factors: production factors, demand conditions, supporting industry and enterprise strategy, structure and competitive advantage, as well as two variables: industry opportunities and government guidance. Using this theory, we now analyze the advantages of the market sinking mode of Quartet cooperation:
(I) factors of production
\u3000\u30001. Industrial foundation. Many aviation enterprises operating in Wuhan have strong strength; Hubei passenger transport group is the largest highway passenger transport enterprise in the province, and the transportation network covers the whole province.
\u3000\u30002. Technical basis. (1) Ctrip is a leading online tourism enterprise in China. Its industrial layout involves online sales of aviation, tourism, hotels and other related service industries. It has established a perfect online marketing network outside China. It has 5000 offline stores in China and 330 in Hubei Province, with the largest market scale in China. (2) Changjiang Yuntong Group Co., Ltd. is jointly established by China Electronic Information Industry Group Co., Ltd. and Wuhan Municipal People’s government. Changjiang Yuntong group integrates eight state-owned information enterprises in Wuhan, including Wuhan city all in one card Co., Ltd. and Wuhan big data industry development Co., Ltd., and is the only digital city construction, operation and investment management platform directly managed by Wuhan SASAC.
(II) demand conditions
According to the data of the seventh national census, the permanent resident population of Hubei reached 57.753 million, including 13.515 million in Wuhan and 44.238 million in other cities in the province. In 2019, China’s per capita passengers will be 0.47. According to the calculation, the annual number of passengers in the third and fourth tier cities in the province will reach 20.792 million. However, in 2019, with the exception of Wuhan airport, the air passenger volume of other airports in the province was 8.159 million, and the market space of nearly 13 million people needs to be developed.
(III) supporting industries
\u3000\u30001. Ground transportation enterprises. As a large-scale passenger transport group under the provincial administration, Hubei passenger transport group has a transportation network covering 72 counties and cities in the province, operates nearly 600 lines and has 3780 daily flights. The provincial passenger transport group cooperates with Ctrip to identify the city where the ticket buyers are located through big data analysis and accurately push the bus travel product information of the terminals in surrounding cities. The provincial passenger transport group can also provide baggage pre check-in services for passengers in third and fourth tier cities, cooperate with the travel platform to provide passengers with short-distance ferry services from home to the nearest urban terminal, and truly realize the “door-to-door” convenient service.
\u3000\u30002. Marketing channels. Ctrip has established perfect online and offline marketing channels in Hubei Province, especially the 330 stores arranged in the province will become the offline marketing network of Hubei airport group in the whole province, and fully integrate the service functions such as flight query, ticket reservation, check-in, airport ground transportation and baggage check-in with the existing tourism sales functions, so as to provide full chain and diversified air travel services for passengers in third and fourth tier cities, Fully tap the potential market demand. Airlines can use this marketing channel to realize the rapid sinking and launch of aviation products. At the same time, with the advantage of Ctrip’s big data platform, it can also deeply analyze the travel needs of passengers in third and fourth tier cities, so as to realize the accurate delivery of aviation products.
\u3000\u30003. Travel service platform. Changjiang Yuntong Group Co., Ltd. has established an integrated travel service platform in the whole province. The platform integrates large passenger transport enterprises and taxi companies in various cities in the province, and can provide diversified and personalized travel services such as long-distance passenger transport, carpooling and special bus for passengers in third and fourth tier cities.
(IV) enterprise strategy, structure and competition
\u3000\u30001. Enterprise strategy. From the perspective of development strategy, the epidemic has led to a sharp decline in the source of tourists of transportation enterprises such as airlines, airports, provincial passenger transport groups and online tourism enterprises such as Ctrip, and a sharp decline in income. Everyone has the power to “hold together for warmth” and cooperate to develop the third and fourth tier markets.
\u3000\u30002. Competitive environment. Recently, with the opening of yellow yellow high-speed railway and Zheng Wan high-speed railway, many air transport enterprises will face more fierce market competition. Therefore, the development of third and fourth tier markets will be the market development work urgently needed to be promoted by airlines in the next step.
(V) opportunities
Covid-19 pneumonia has led to a significant reduction in passenger sources in the first and second tier markets, forcing airlines to focus on China’s third and fourth tier cities. The curtain of the large-scale development of the third and fourth tier aviation market has been opened.
(VI) government guidance and promotion
At present, with the in-depth promotion of the national dual cycle strategy, the formation of a unified and standardized Chinese market is accelerating, and the potential demand for air travel in third and fourth tier cities will accelerate. At the same time, the civil aviation administration put forward the working idea of “keeping the bottom line, stabilizing expectations, strengthening the foundation, tapping potential, improving quality and efficiency and innovating performance” at the national civil aviation work conference in 2022, calling on the majority of aviation enterprises to deeply tap the market potential and broaden marketing channels, which will provide a strong driving force for promoting the sinking of the third and fourth tier markets.
To sum up, the market sinking mode of Quartet cooperation has obvious advantages and has great prospects in the future.
IV. current progress
Hubei Airport Group has coordinated with many aviation enterprises to design and launch more than 10 special price air travel products for passengers in the third and fourth tier cities in Hubei Province; Connect with the provincial passenger transport group and Ctrip, and launch “air bus pass” products in Xianning, Suizhou and other places in the province; It will cooperate with travel service platforms such as Changjiang Yuntong group to integrate the transportation resources of high-quality passenger transport enterprises in the province and provide more abundant ground travel service products for passengers; It will connect with OTA enterprises to determine the marketing and publicity strategies and advertising contents of each store.
China’s third and fourth tier cities have broad market space. Hubei Airport Group will strengthen cooperation with airlines, OTA enterprises and passenger transport enterprises to provide more passengers in third and fourth tier cities with comfortable, convenient and safe air travel services, and make a positive contribution to accelerating the cultivation of “popular air travel market”. (author: Liu Rui unit: Hubei airport group company)
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