Airline segmentation - or how to be 'half pregnant'?

Legacy airlines worldwide have adopted varying ways of responding to LCC competition. Now the economic downturn has sapped their most lucrative business customers, the challenge becomes even greater. But, hampered by long-standing union agreements and huge fixed investments in infrastructure, a growing number of carriers are trialling new products within their existing operating structure, in an attempt to segment the market and fend off competitive incursions. [2234 words]

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This report contains the following subheadings:

• The airline segmentation headache
• El Al launches “no frills” product
• Stripping out the basics and charging for them
• An inspired move, or desperation for a loss maker?
• Philippine Airlines - EconoLight Class “low fares”
• CSA Czech Airlines - Click4sky “virtual low cost”
• India’s Jet Airways – “Jet Konnect” brand under the umbrella
• Conclusion: Segmentation-fuelled brand confusion

This report contains the following charts and tables:

• El Al, Philippine Airlines, Jet Airways and Czech Airlines profits for FY2008/09
• LCC entrants to Tel Aviv
• The EconoLight product on PAL’s website
• The Click4Sky product on CSA’s website
• The Jet Airways Konnect product on Jet Airways’ website