Dublin City University

Project Description

For which services are customers willing to pay a premium when flying with a low-fare airline?

Project Abstract

There has been a boom of low-fare airlines in Europe during the last ten years. Following the business model of the famous pioneer Ryanair many low-fare airlines have been set up and established in the European market. Enormous two-digit growth rates of passenger numbers enabled the airlines to earn money and expand. Today there is a tough competition in the market and only the two big players Ryanair and Easyjet enjoy noteworthy profit margins. As a result of that the low-fare airlines strive to differentiate themselves from their competitors through their customer service. There are four major areas in that the airlines differ from another: Baggage, Check-In and Cancellation/Change of booked flights. This project will not discuss the additional services like car rental, hotel booking etc. In order to estimate the preferences of the customer a conjoint analysis will be conducted providing empirical background for the discussion.

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