Table of Contents
Executive Summary
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- The market
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- Figure 1: US airline operating revenue and fan chart forecast, at current prices, 2009-19
- Market drivers
- Leading companies
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- Figure 2: Share of passengers for top 10 US airlines, 2013
- The consumer
- Air travel is second only to automobiles
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- Figure 3: Mode of travel used for domestic trips in previous 12 months, car versus plane, by age, January 2013-March 2014
- Men more likely to fly up front than women
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- Figure 4: Past 12 month airline use – Service class and reasons, by gender, June 2014
- Online booking has become the norm
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- Figure 5: How most recent airline reservations were made, by airline purpose, June 2014
- Price and schedule bear largest influence on booking
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- Figure 6: Top factors impacting airline selection, June 2014
- Men seek VIP status, women seek deals
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- Figure 7: Loyalty rewards of greatest interest, by gender, June 2014
- Fees and time of departure can deter travelers
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- Figure 8: Reasons to avoid an airline when flying for personal reasons, June 2014
- Consumer perception of brands and loyalty programs has suffered
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- Figure 9: Attitudes toward airline differentiation and loyalty programs, June 2014
- Asian (business) travelers present lucrative target
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- Figure 10: Past 12 month airline use, by race/Hispanic origin, June 2014
- What we think
Issues and Insights
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- High-profile transportation mishaps could deter travelers
- The issues
- The implications
- Consolidation muddles brand identities
- The issues
- The implications
- Competition may be arriving from abroad
- The issues
- The implications
Trend Application
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- Trend: Prepare for the Worst
- Trend: Accentuate the Negative
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- Figure 11: Spirit Hate Thousand Miles microsite, 2014
- Trend: Why Buy
Market Size and Forecast
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- Key points
- Revenues, passenger counts are up; trend expected through 2019
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- Figure 12: US airline operating revenue and forecast, at current prices, 2009-19
- Figure 13: US airline operating revenue and forecast, at inflation-adjusted prices, 2009-19
- Fan chart forecast
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- Figure 14: US airline operating revenue and fan chart forecast, at current prices, 2009-19
Market Drivers
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- Key points
- Airlines and the economy: A love story
- Airlines and fuel prices: It’s complicated
- Fuel hedging
- Crack spread
- Passing costs on to customers
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- Figure 15: Crude oil price (USD/Barrel) May 2000-March 2014
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- Figure 16: Average fleet age in 2014 by 2010 ICCT efficiency ranking
- Airlines and traveler sentiment: Riding out the ups and downs
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- Figure 17: Traveler sentiment index, March 2007-April 2014
- Airlines and consolidation: Let’s get together
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- Figure 18: US DOT national level domestic average airfares, 2000-13
Competitive Context
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- Cars still claim the top spot with domestic travelers
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- Figure 19: Mode of travel used for domestic trips in previous 12 months, January 2013-March 2014
- US falls behind in high-speed rail development
- Fractional jet ownership makes private travel more affordable
Segment Performance
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- Key points
- Airfares still account for greatest share, though growth slows
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- Figure 20: Total operating revenue of US airlines, by revenue type, 2012 and 2014
- Figure 21: Total operating revenue of US airlines, by revenue type, 2009-19
- Airfares’ contribution dwindles
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- Figure 22: US airlines’ operating revenue – Airfares, 2009-19
- Figure 23: Annual US domestic average itinerary fare in current and constant dollars, 1995-2013
- Strong growth projected for transport-related revenue
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- Figure 24: US airlines’ operating revenue – Transport-related revenue, 2009-19
- Miscellaneous revenue steady, but contribution is small
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- Figure 25: US airlines’ operating revenue – Miscellaneous, 2009-19
- Baggage fees mostly flat since 2010
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- Figure 26: US airlines’ operating revenue – Baggage fees, 2009-19
- Change/cancellations fees steady, but contribution is small
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- Figure 27: US airlines’ operating revenue – Change/Cancellation fees, 2009-19
Leading Companies
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- Key points
- Legacy carriers fly majority of passengers
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- Figure 28: Passenger count for top 10 US airlines, 2012-13
- Delta Air Lines
- Southwest Airlines
- United Airlines
- American Airlines Group
Innovations and Innovators
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- Putting tech in travel
- Air France-KLM launch eTag, eTrack devices
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- Figure 29: Air France-KLM eTag and eTrace video, 2014
- Virgin Atlantic experiments with wearable technology
- Using tech to field feedback
- Delta debuts photon shower at TED
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- Figure 30: Delta’s Photon Shower at TED Conference, 2013
- Not just “from point A to point B” but covering everything “from A to Z”
- Lufthansa pilots new seating class
- Routehappy dishes on the in-flight experience
- Adding a personal aspect to flying
- Going “The Extra Mile”
- Virgin encourages passengers to mingle
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- Figure 31: Sir Richard Branson’s Guide to Getting Lucky, 2013
- Focusing on flying families
- Lufthansa targets families before the gate
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- Figure 32: Lufthansa Family Check-in counter, 2013
- Etihad Airways targets family in the skies
- Other efforts
- Air France up-cycles life jackets and posters
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- Figure 33: Up-cycled products from Air France and Bilum, 2013
- British Airways and Twinings partner on a unique “cuppa”
- AirBaltic rewards flyers for breaking a sweat
- JetKonnect debuts fun food packaging
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- Figure 34: Grandmother’s packaging created for JetKonnect, 2014
Marketing Strategies
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- Overview of the brand landscape
- Theme: Reliability and routes
- The many languages of the “Friendly Skies”
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- Figure 35: United Airlines “Your Gateway to the World,” television ad, 2014
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- Figure 36: United Airlines “right place right time,” print ad, 2013
- Delta shows its strengths at-home and abroad
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- Figure 37: Delta Airlines “There’s no such thing as fashionably late” print ad, 2014
- Figure 38: Delta Air Lines “Shortest Distance” online ad, 2014
- Theme: Highlighting perks in the face of unbundled backlash
- A true “frequent flier” dishes for JetBlue
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- Figure 39: JetBlue “Air on the side of humanity," television ad, 2013
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- Figure 40: JetBlue “Funny or Die” video series, Episode 2, 2014
- Virgin encourages travelers to “Feel the Upgrade”
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- Figure 41: Virgin America “Main Cabin Select” online ad, 2014
- Theme: Pushing e-options
- American Airlines touts in-flight entertainment
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- Figure 42: American Airlines “Time flies,” television ad, 2013
- Delta empowers passengers
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- Figure 43: Delta “Work doesn’t stop,” print ad, 2014
- Theme: Breaking the mold
- Virgin turns safety video into music video
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- Figure 44: Virgin America safety video, 2013
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- Figure 45: Virgin America Safety Dance Battle, 2013
- Delta rolls out Cheer Carts
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- Figure 46: Delta Air Lines “Cheer Cart” video, 2013
- Southwest evolves with its customers
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- Figure 47: Southwest Airlines “Welcome Aboard” Ad, 2013
Social Media
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- Key points
- Market overview
- Key social media metrics
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- Figure 48: Key performance indicators, selected airline brands, July 21, 2013-July 20, 2014
- Brand usage and awareness
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- Figure 49: Brand usage and awareness of selected airline brands, June 2014
- Interaction with brands
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- Figure 50: Interaction with airline brands, May 2014
- Leading online campaigns
- In-flight social network
- Co-creation
- Hashtag campaigns
- Syncing social media campaigns with current events
- What we think
- Online conversations
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- Figure 51: Selected American Airlines Twitter mentions, November 2013
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- Figure 52: Online mentions, selected airline brands, July 21, 2013-July 20, 2014
- Where are people talking about airline brands?
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- Figure 53: Mentions, by page type, selected airline brands, July 21, 2013-July 20, 2014
- What are people talking about online?
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- Figure 54: Mentions, by topic of conversation, selected airline brands, July 21, 2013-July 20, 2014
Frequency of/Reasons for Air Travel
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- Key points
- Those aged 25-44 in “prime air traveling years”
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- Figure 55: Mode of travel used for domestic trips in previous 12 months, car versus plane, by age, January 2013-March 2014
- Travelers average about two airplane trips per year
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- Figure 56: Frequency of domestic travel by plane in previous 12 months, January 2013-March 2014
- Business travel making a comeback
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- Figure 57: Number of business or personal domestic trips taken by plane in previous 12 months, January 2013-March 2014
Passenger Service Class Traveled
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- Key points
- Economy class most frequently flown
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- Figure 58: Past 12 month airline use, by airline purpose and service class, June 2014
- Across the aircraft, men fly more frequently
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- Figure 59: Past 12 month airline use, by gender, June 2014
- Those aged 25-34 most frequent flyers
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- Figure 60: Past 12 month airline use, by age, June 2014
- Millennial men most likely to fly premium service classes
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- Figure 61: Past 12 month airline use, by gender and age, June 2014
Air Travel Booking
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- Key points
- Three quarters of passengers book themselves
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- Figure 62: Airline reservations, June 2014
- Personal versus business travel booking
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- Figure 63: Airline reservations, June 2014
- Younger consumers more tech-savvy but may not be booking their own travel
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- Figure 64: How reservations for most recent flight were made, by generations, June 2014
- Women book online while men seek a helping human hand
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- Figure 65: How reservations for most recent flight were made for personal reasons, by gender, June 2014
Factors Impacting Airline Selection
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- Key points
- Price and schedule are important, but not the only factors considered
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- Figure 66: Factors impacting airline selection, June 2014
- Millennials poised to influence in-flight offerings
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- Figure 67: Most important factors in airline selection for personal reasons, by age, June 2014
- Business takes priority
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- Figure 68: Most important factors in airline selection for personal reasons, by airline purpose, June 2014
Interest in Loyalty Rewards
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- Key points
- Small perks can go a long way in driving loyalty
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- Figure 69: Loyalty rewards of greatest interest, June 2014
- Men want to feel like VIPs, women want to save money
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- Figure 70: Loyalty rewards of greatest interest, by gender, June 2014
- Personal/business travelers also want to feel like VIPs
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- Figure 71: Loyalty rewards of greatest interest, by airline purpose, June 2014
Reasons to Avoid an Airline
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- Key points
- Is all fair in airfare advertising?
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- Figure 72: Reasons to avoid an airline when flying for personal reasons, June 2014
- Women more selective than men
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- Figure 73: Reasons to avoid an airline when flying for personal reasons, by gender, June 2014
- Millennials surprisingly more forgiving
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- Figure 74: Reasons to avoid an airline when flying for personal reasons, by generations, June 2014
- Personal travelers keep their mind on their money
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- Figure 75: Reasons to avoid an airline when flying for personal reasons, by airline purpose, June 2014
Attitudes Toward Comfort and Safety
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- Key points
- Call me (in flight), maybe?
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- Figure 76: Attitudes toward in-flight phone conversations, June 2014
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- Figure 77: Attitudes toward in-flight phone conversations – Any agree, by age, June 2014
- A matter of trust
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- Figure 78: Attitudes toward trust in US airlines over international airlines, June 2014
- Disasters abroad less impactful than matters close to home
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- Figure 79: Attitudes toward airline safety, June 2014
Attitudes Toward Loyalty Programs/Brand Differentiation
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- Key points
- The price, the whole price, and nothing but the price (+ fees and taxes)
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- Figure 80: Attitudes toward online ticket price display, June 2014
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- Figure 81: Attitudes toward online ticket price display – Any agree, by gender, age, and household income, June 2014
- Loyalty programs favor business travelers
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- Figure 82: Attitudes toward airline loyalty programs and business travelers’ benefits, June 2014
- Non-business travelers feel neglected
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- Figure 83: Attitudes toward airline loyalty programs and effort, June 2014
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- Figure 84: Attitudes toward airline loyalty programs and effort – Any agree, by age, June 2014
- Airlines not leaving an impression on one third of passengers
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- Figure 85: Attitudes toward ability to remember last airline flown, June 2014
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- Figure 86: Attitudes toward ability to remember last airline flown – Any agree, by age, June 2014
Attitudes Toward Technology/In-flight Entertainment
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- Key points
- Majority of passengers seek in-flight connectivity
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- Figure 87: Attitudes toward internet connectivity in-flight, June 2014
- BYOE – Bring Your Own Entertainment
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- Figure 88: Attitudes toward in-flight entertainment on own devices, June 2014
- Nearly four in 10 want to chat in-flight
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- Figure 89: Attitudes toward talking on phones in-flight, June 2014
- One third prefer mobile apps to full websites for airline information
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- Figure 90: Attitudes toward using mobile apps over full websites for airline information, June 2014
- Electronic methods preferred over interactions with airline personnel
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- Figure 91: Attitudes toward airline personnel and technology, June 2014
Impact of Race and Hispanic Origin
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- Key points
- Asians are the most likely flyers
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- Figure 92: Past 12 month airline use, by race/Hispanic origin, June 2014
- Whites book online, Black travelers seek human help
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- Figure 93: How reservations for most recent flight were made for personal reasons, by race/Hispanic origin, June 2014
- Black travelers are price-sensitive
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- Figure 94: Most important factors in airline selection for personal reasons, by race/Hispanic origin, June 2014
- Black travelers may be swayed by shopping perks
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- Figure 95: Loyalty rewards of greatest interest, by race/Hispanic origin, June 2014
- Black respondents more forgiving of fees and schedules
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- Figure 96: Reasons to avoid an airline when flying for personal reasons, by race/Hispanic origin, June 2014
- Non-White consumers have safety concerns
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- Figure 97: Attitudes toward airlines and airline travel – Any agree, by race/Hispanic origin, June 2014
Cluster Analysis
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- Figure 98: Airline clusters, June 2014
- Cluster 1: Up-and-Comers
- Demographics
- Characteristics
- Opportunity
- Cluster 2: Average Travelers
- Demographics
- Characteristics
- Opportunity
- Cluster 3: Infrequent Leisure Travelers
- Demographics
- Characteristics
- Opportunity
- Cluster 4: Frequent Travelers
- Demographics
- Characteristics
- Opportunity
- Cluster characteristics
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- Figure 99: Past 12 month airline use, by airline clusters, June 2014
- Figure 100: Past 12 month airline use – Personals, by airline clusters, June 2014
- Figure 101: Past 12 month airline use – Business, by airline clusters, June 2014
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- Figure 102: How reservations for most recent flight were made for personal reasons, by airline clusters, June 2014
- Figure 103: Most important factors in airline selection for personal reasons, by airline clusters, June 2014
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- Figure 104: Loyalty rewards of greatest interest, by airline clusters, June 2014
- Figure 105: Reasons to avoid an airline when flying for personal reasons, by airline clusters, June 2014
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- Figure 106: Attitudes toward airlines and airline travel – Any agree, by airline clusters, June 2014
- Cluster demographics
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- Figure 107: Airline clusters, by demographics, June 2014
- Cluster methodology
- Comfort/safety
- Loyalty/differentiation
- Technology/mobile
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Appendix – Social Media
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- Brand analysis
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- Figure 108: Key social media indicators of selected airline brands, July 2014
- Online conversations
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- Figure 109: Online mentions, selected airline brands, July 21, 2013-July 20, 2014
- Brand usage or awareness
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- Figure 110: Brand usage or awareness, June 2014
- Figure 111: American Airlines usage or awareness, by demographics, June 2014
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- Figure 112: Delta Air Lines usage or awareness, by demographics, June 2014
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- Figure 113: United Airlines usage or awareness, by demographics, June 2014
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- Figure 114: Southwest Airlines usage or awareness, by demographics, June 2014
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- Figure 115: JetBlue usage or awareness, by demographics, June 2014
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- Figure 116: Virgin America usage or awareness, by demographics, June 2014
- Activities done
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- Figure 117: Activities done, June 2014
- Figure 118: American Airlines – Activities done – I have looked up/talked about this brand online on social media, by demographics, June 2014
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- Figure 119: American Airlines – Activities done – I have contacted/interacted with the brand online on social media to, by demographics, June 2014
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- Figure 120: American Airlines – Activities done – I follow/like the brand on social media because, by demographics, June 2014
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- Figure 121: American Airlines – Activities done – I have researched the brand on social media to, by demographics, June 2014
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- Figure 122: Delta Air Lines – Activities done – I have looked up/talked about this brand online on social media, by demographics, June 2014
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- Figure 123: Delta Air Lines – Activities done – I have contacted/interacted with the brand online on social media to, by demographics, June 2014
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- Figure 124: Delta Air Lines – Activities done – I follow/like the brand on social media because, by demographics, June 2014
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- Figure 125: Delta Air Lines – Activities done – I have researched the brand on social media to, by demographics, June 2014
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- Figure 126: United Airlines – Activities done – I have looked up/talked about this brand online on social media, by demographics, June 2014
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- Figure 127: United Airlines – Activities done – I have contacted/interacted with the brand online on social media to, by demographics, June 2014
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- Figure 128: United Airlines – Activities done – I follow/like the brand on social media because, by demographics, June 2014
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- Figure 129: United Airlines – Activities done – I have researched the brand on social media to, by demographics, June 2014
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- Figure 130: Southwest Airlines – Activities done – I have looked up/talked about this brand online on social media, by demographics, June 2014
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- Figure 131: Southwest Airlines – Activities done – I have contacted/interacted with the brand online on social media to, by demographics, June 2014
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- Figure 132: Southwest Airlines – Activities done – I follow/like the brand on social media because, by demographics, June 2014
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- Figure 133: Southwest Airlines – Activities done – I have researched the brand on social media to, by demographics, June 2014
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- Figure 134: JetBlue – Activities done – I have looked up/talked about this brand online on social media, by demographics, June 2014
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- Figure 135: JetBlue – Activities done – I have contacted/interacted with the brand online on social media to, by demographics, June 2014
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- Figure 136: JetBlue – Activities done – I follow/like the brand on social media because, by demographics, June 2014
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- Figure 137: JetBlue – Activities done – I have researched the brand on social media to, by demographics, June 2014
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- Figure 138: Virgin America – Activities done – I have looked up/talked about this brand online on social media, by demographics, June 2014
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- Figure 139: Virgin America – Activities done – I have contacted/interacted with the brand online on social media to, by demographics, June 2014
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- Figure 140: Virgin America – Activities done – I have researched the brand on social media to, by demographics, June 2014
Appendix – Other Useful Consumer Tables
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- Passenger service class traveled
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- Figure 141: Past 12 month airline use, by service class, June 2014
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- Figure 142: Past 12 month airline use, average number of flights, June 2014
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- Figure 143: Past 12 month airline use, by age, June 2014
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- Figure 144: Past 12 month airline use, by household income, June 2014
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- Figure 145: Past 12 month airline use, by generations, June 2014
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- Figure 146: Past 12 month airline use, by airline frequency, June 2014
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- Figure 147: Past 12 month airline use – Frequency – Light, medium, high, ultra, by gender, June 2014
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- Figure 148: Past 12 month airline use – Frequency – Light, medium, high, ultra, by age, June 2014
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- Figure 149: Past 12 month airline use – Frequency – Light, medium, high, ultra, by household income, June 2014
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- Figure 150: Past 12 month airline use – Frequency – Light, medium, high, ultra, by race/Hispanic origin, June 2014
- Air travel booking
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- Figure 151: How reservations for most recent flight were made, by gender, June 2014
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- Figure 152: How reservations for most recent flight were made, by age, June 2014
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- Figure 153: How reservations for most recent flight were made for personal reasons, by age, June 2014
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- Figure 154: How reservations for most recent flight were made for personal reasons, by household income, June 2014
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- Figure 155: How reservations for most recent flight were made for personal reasons, by airline frequency, June 2014
- Factors impacting airline selection
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- Figure 156: Most important factors in airline selection for personal reasons, by gender, June 2014
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- Figure 157: Most important factors in airline selection for personal reasons, by household income, June 2014
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- Figure 158: Most important factors in airline selection for personal reasons, by airline frequency, June 2014
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- Figure 159: Most important factors in airline selection for personal reasons, by airline service class, June 2014
- Interest in loyalty rewards
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- Figure 160: Loyalty rewards of greatest interest, by age, June 2014
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- Figure 161: Loyalty rewards of greatest interest, by household income, June 2014
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- Figure 162: Loyalty rewards of greatest interest, by generations, June 2014
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- Figure 163: Loyalty rewards of greatest interest, by airline frequency, June 2014
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- Figure 164: Loyalty rewards of greatest interest, by airline service class, June 2014
- Reasons to avoid an airline
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- Figure 165: Reasons to avoid an airline when flying for personal reasons, by age, June 2014
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- Figure 166: Reasons to avoid an airline when flying for personal reasons, by household income, June 2014
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- Figure 167: Reasons to avoid an airline when flying for personal reasons, by airline frequency, June 2014
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- Figure 168: Reasons to avoid an airline when flying for personal reasons, by airline service class, June 2014
- Attitudes toward airlines and airline travel
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- Figure 169: Attitudes toward airlines and airline travel – Any agree, June 2014
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- Figure 170: Attitudes toward airlines and airline travel – Any agree, by gender, June 2014
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- Figure 171: Attitudes toward airlines and airline travel – Any agree, by age, June 2014
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- Figure 172: Attitudes toward airlines and airline travel – Any agree, by household income, June 2014
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- Figure 173: Attitudes toward airlines and airline travel – Any agree, by airline service class, June 2014
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- Figure 174: Attitudes toward airlines and airline travel – Any agree, by airline purpose, June 2014
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- Figure 175: Attitudes toward airlines and airline travel – Any agree, by airline frequency, June 2014
Appendix – Trade Associations
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