Table of Contents
Overview
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- What you need to know
- Scope of the report
Executive Summary
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- The market
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- Figure 1: Volume forecast of total passengers uplifted at UK airports, 2011-21
- Figure 2: Volume forecast of domestic passengers uplifted at UK airports, 2011-21
- Figure 3: Volume forecast of international passengers uplifted at UK airports, 2011-21
- The consumer
- Air travel is growing thanks to strong holiday and business markets
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- Figure 4: Flight types taken, July 2015 to June 2016
- A rise in consumers flying premium economy
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- Figure 5: Classes flown in the last 12 months, July 2015 to June 2016
- A quarter of consumers willing to pay for Wi-Fi on long-haul flights
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- Figure 6: Flight behaviours (I), June 2016
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- Figure 7: Attitudes towards flights II (2), June 2016
- What we think
Issues and Insights
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- Perceptions of budget airlines has improved over the last two years
- The facts
- The implications
- Usage of premium economy on the rise
- The facts
- The implications
- Younger consumers and parents most willing to pay for onboard Wi-Fi
- The facts
- The implications
The Market – What You Need To Know
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- Strong growth in 2015 and H1 2016, but further growth may be curbed by Brexit
- Brexit result; consumer caution and possible regulation changes
- A weak pound is making holidays more expensive
Market Size and Forecast
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- Strong growth in 2016 but challenges remain
- Growth forecast but at a slightly slower rate
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- Figure 8: Passengers uplifted at UK airports, 2011-21
- Figure 9: Volume forecast of total passengers uplifted at UK airports, 2011-21
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- Figure 10: Volume forecast of domestic passengers uplifted at UK airports, 2011-21
- Figure 11: Volume forecast of international passengers uplifted at UK airports, 2011-21
Market Drivers
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- Brexit result; consumer caution and possible regulation changes
- A weak pound is making holidays more expensive
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- Figure 12: Pound versus euro, 10 August 2015 to 10 August 2016
- Figure 13: Pound versus US Dollar, 10 August 2015 to 10 August 2016
- Weak Pound could boost trips to Eastern Europe
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- Figure 14: Post Office City Cost Barometer 2016
- Low oil price leads to low airfares
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- Figure 15: Europe Brent Spot Price Free On Board (FOB), Dollars per Barrel, August 2011 to August 2016
- Rail remains and expensive option for domestic holidaymakers
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- Figure 16: UK rail fares index, 2004-16
- Figure 17: UK rail fares index, 2004-16
- North African and Turkish markets suffering
- Ryanair to pivot growth from the UK could potentially increase fares
- Decision delayed for expanding Heathrow
Segment Performance
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- Air travel increases market share
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- Figure 18: Overseas trips taken by UK resident, by mode of transport, 2014 2015
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- Figure 19: Overseas trips taken by UK resident, by mode of transport, Q1 2014 and Q1 2015
- Independent bookings grow while packages fall
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- Figure 20: Independent versus non-independent air travel bookings, 2014-15
- Scheduled flights increase while charter decrease
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- Figure 21: Passengers uplifted at UK airports, scheduled versus non-scheduled, 2008-16
- Italy overtakes France as thrid top destination
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- Figure 22: Top ten countries by air visits, 2014-15
Key Players – What You Need to Know
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- Virgin Atlantic viewed as a stylish and trendy brand
- British Airways is the UK’s favourite airline brand
- Thomson Airways is the most popular charter airline brand
- Thomas Cook’s association with ATOL protection instils trust
- easyJet is the UK’s most popular budget airline
- Broadly negative views of Ryanair
Market Share
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- Ryanair enjoys double digit growth
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- Figure 23: Top 10 UK-based airlines, by passengers uplifted globally, 2010-15
Brand Research
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- Brands covered
- Virgin Atlantic
- British Airways
- Thomson Airways
- Thomas Cook Airlines
- easyJet
- Ryanair
- Brand map
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- Figure 24: Attitudes towards and usage of selected brands, June 2016
- Key brand metrics
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- Figure 25: Key metrics for selected brands, June 2016
- Brand attitudes: British Airways and Virgin offer consistently high quality
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- Figure 26: Attitudes, by brand, June 2016
- Brand personality: Ryanair viewed as unappealing
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- Figure 27: Brand personality – Macro image, June 2016
- Although perceived as stylish and trendy, Virgin Atlantic considered to be overpriced
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- Figure 28: Brand personality – Micro image, June 2016
- Brand analysis
- Virgin Atlantic most likely to be rated an excellent experience
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- Figure 29: User profile of Virgin Atlantic, June 2016
- British Airways is the UK’s favourite airline brand but also viewed as overpriced
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- Figure 30: User profile of British Airways, June 2016
- Thomson Airways is the most popular charter airline brand
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- Figure 31: User profile of Thomson Airways, June 2016
- Thomas Cook Airlines association with ATOL protection instils trust
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- Figure 32: User profile of Thomas Cook Airlines, June 2016
- easyJet is the UK’s most popular budget airline
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- Figure 33: User profile of easyJet, June 2016
- Broadly negative perception of Ryanair
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- Figure 34: User profile of Ryanair, June 2016
Launch Activity and Innovation
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- Amadeus to tackle customer abandonment in the flight booking process
- Etihad Airways rolls out its new iPhone app
- Real time onboard seat auctions to be made possible
- Ryanair plan to launch new corporate jets
- Ryanair set to roll out new digital services
- Ryanair reveals plans for budget accommodation service
- Thomas Cook Airlines launch new routes for 2017
- Thomas Cook introduces new routes for summer 2017
The Consumer – What You Need to Know
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- The proportion of consumers flying grows over the past year
- Use of budget carriers is more common
- More consumers are purchasing premium economy seats
- Charter flights most likely to be booked in-store
- Most consumers are happy to book on a smartphone
- A quarter of consumers willing to pay for Wi-Fi on long-haul flights
- Budget long haul appeals to younger frequent flyers
Flight Types Taken
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- Air travel is growing as consumer return overseas
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- Figure 35: Flight types taken, July 2015 to June 2016
- Figure 36: Last flight type taken, June 2015
- Easing the stresses of business travellers
- Frequent flyers are more likely to live in London or Scotland
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- Figure 37: Number of flights taken in the last 12 months, June 2016
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- Figure 38: Number of flights taken in the last 12 months, by flight types taken in the last 12 months, June 2016
Airline Types Flown
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- A greater proportion of people are flyer using charter airlines
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- Figure 39: Airline types flown in the last 12 months, June 2016
- 16-24s are big users of full-service airlines
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- Figure 40: Airline types flown in the last 12 months, by age, June 2016
- Perceptions of budget airlines are improving
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- Figure 41: Perceptions of service improvements on budget airlines over the past few years, June 2016
- Parents also feel budget airlines have improved
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- Figure 42: Willingness to pay for a more comfortable flight, June 2016
Classes Flown
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- Premium economy usage increases
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- Figure 43: Classes flown in the last 12 months, July 2015 to June 2016
- Premium economy more popular with younger consumers…
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- Figure 44: Attitudes towards paying for premium economy, short-haul versus long-haul, June 2016
- …while economy is more popular with older consumers
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- Figure 45: Classes flown in the past 12 months, by age, June 2016
- Families are key target groups for premium economy
Flight Booking
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- Around a quarter book flights offline
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- Figure 46: How last flight was booked, June 2016
- Charter flights most likely to be booked in-store
- Budget carriers are far more likely to be booked online than full-service
- Seniors are the mostly likely group to book offline
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- Figure 47: How respondents would describe their financial situation, by age, June 2016
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- Figure 48: Consumer’s financial outlook for the coming year, by age, June 2016
- Figure 49: What extra money is spend upon, by age, June 2016
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- Figure 50: Plans to book a holiday in the next three months, by age, June 2016
Device Used for Online Booking
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- Reaching consumers while out and about
- Most consumers are happy to book on a smartphone
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- Figure 51: Attitudes towards using a smartphone to book a flight, June 2016
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- Figure 52: Attitudes towards using a smartphone to book a flight, by age, June 2016
- Smart TV bookings are one to watch for the future
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- Figure 53: How last flight was booked online, June 2016
Flight Behaviours
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- Half of flyers exhibit savvy shopping behaviours
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- Figure 54: Savvy flyers*, June 2016
- Comparing different flight combinations to get the cheapest deal
- A quarter of consumers willing to pay for Wi-Fi on long-haul flights
- A sizable proportion think that loyalty programmes are confusing
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- Figure 55: Attitudes towards airline loyalty programme, June 2016
- Figure 56: Flight behaviours (I), June 2016
- Finding the cheapest flight
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- Figure 57: Flight behaviours (II), June 2016
Attitudes towards Flights I
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- Opportunity for medium-haul long weekends for the right price
- Multicentre trips popular with young people and Londoners
- The majority of travellers open to stopovers to save money
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- Figure 58: Attitudes towards flights I, June 2016
Attitudes towards Flights II
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- Consumers want the option of booking packages on airline websites
- Business-to-customer interaction through live chat messaging
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- Figure 59: Attitudes towards flights II (1), June 2016
- Courting older demographics
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- Figure 60: Willingness to pay for extra services, by age, June 2016
- Budget long haul appeals to younger frequent flyers
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- Figure 61: Attitudes towards flights II (2), June 2016
Mobile Ownership – Flight Attitudes and Behaviours
CHAID Analysis
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- More parents think premium economy is worth it, while young frequent flyers are open to long-haul flights on budget carriers
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- Figure 62: Target groups based on attitudes toward airlines – CHAID – Tree output, June 2016
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- Figure 63: Target groups based on attitudes toward airlines – CHAID – Table output, June 2016
Appendix – Data Sources, Abbreviations, and Supporting Information
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- Abbreviations
- Definitions
- Forecast methodology
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- Figure 64: Best- and worst-case forecast for total UK passenger uplift, 2016-21
- Figure 65: Best- and worst-case forecast for domestic UK passenger uplift, 2016-21
- Figure 66: Best- and worst-case forecast for international UK passenger uplift, 2016-21
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