Disrupting Demand Migration: Finnair Response in the European Market
Ngadi, Haslilah (2024)
Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-2024052314908
https://urn.fi/URN:NBN:fi:amk-2024052314908
Tiivistelmä
The European aviation industry has experienced significant changes due to market liberalisation and the rise of low-cost carriers (LCCs), leading to demand migration from legacy carriers to low-cost carriers. This thesis explores the factors driving this demand migration and evaluates Finnair's strategic responses to these competitive pressures. The study provides insights into the airline's adaptation strategies through case studies of Finnair's operations on the Helsinki Stockholm and Helsinki-Malaga routes.
The research identifies key factors influencing demand migration, including pricing strategies, service offerings, route network structure, and changes in customer preferences. The findings highlight that low-cost carriers attract price-sensitive travellers by offering lower base fares and utilising secondary airports, which reduces operational costs and increases flight frequencies. In contrast, Finnair's strategies focus on premium services, network optimisation, and sustainability initiatives.
To mitigate demand migration, Finnair must enhance its competitive edge by adopting flexible pricing models, increasing flight frequencies, and improving digital customer engagement. The study concludes with strategic recommendations for Finnair to sustain its market position and ensure long-term growth in a rapidly evolving aviation market.
The research identifies key factors influencing demand migration, including pricing strategies, service offerings, route network structure, and changes in customer preferences. The findings highlight that low-cost carriers attract price-sensitive travellers by offering lower base fares and utilising secondary airports, which reduces operational costs and increases flight frequencies. In contrast, Finnair's strategies focus on premium services, network optimisation, and sustainability initiatives.
To mitigate demand migration, Finnair must enhance its competitive edge by adopting flexible pricing models, increasing flight frequencies, and improving digital customer engagement. The study concludes with strategic recommendations for Finnair to sustain its market position and ensure long-term growth in a rapidly evolving aviation market.