Passengers’ perceptions of low cost airlines and full service carriers: A case study of fly540 and Kenya Airways

Abstract

The low cost experience is a relatively new phenomenon in the African region with much of the necessary management experience brought it from outside the region. African low cost carriers are in the initial growth phase of their development, while many of their American and European counterparts are approaching or have reached maturity. Due to this, little data is available about low cost operations in Africa and specifically in Kenya. The study was therefore designed to determine passenger perception of low cost and full service carriers and also to establish the factors that influence passenger perception of airlines in Kenya. A cross-sectional survey design was employed. The population of interest was the passengers flying Kenya Airways (network carrier) and Fly540 (a low-cost carrier). All the passengers travelling from Nairobi (JKIA) to their various destinations flying the two carriers on a particular day formed the population of study. Both groups were travelling to the same city destination, but not necessarily to the same airport. A sample of 120 passengers was selected for the survey using simple random sampling technique. Sixty passengers were selected from each of the airlines’ passengers on the particular day of data collection. Data was collected using primary sources. The data collection tool was questionnaires. Data was analysed using descriptive and inferential statistics. Passengers perceive low cost carriers to offer very low fares in the market. This is exhibited by the fact that most of those travelling in Fly540 did so solely because of the fares charged and they also thought that the flight charges less fares as compared to Kenya airways. It is for this reason that most of them would be switching to full carriers if KQ reduced its fares. Even those that were travelling with KQ asserted that the fares were high but chose to travel with the flight because of other reasons like comfort and quality rather than due to its fares. The study established that age had the largest influence on passenger perception of airlines with a correlation value of 0.919. This is followed by reason for travel with a correlation coefficient of 0.681 then gender with correlation coefficient of 0.648. The study recommends that instead of airlines using one business model, a combination can be done so as to capture a larger share of the market as concerns those sensitive to prices and those who need quality services rather than consider fares when booking flights. The study also viii recommends that airlines consider marketing to individuals different from group bookings. It seems that most of those travelling as groups used the low cost carrier. Thus, the full service carriers can devise strategies to attract group bookings in order not to lose business to low cost carriers.