Philippines Orient Airways

Topics: Airline, Avianca, Low-cost carrier Pages: 13 (3224 words) Published: August 29, 2010
I.Case Overview
Philippine Orient Airways (POA) is an airline company that focuses on domestic operations. They took part of the market share when the Company was incorporated in January 21, 1997, and formally started operations after receiving the Operator’s Permit from the Government. With granting of the 5-year Certificate of Public Convenience and Necessity (CPCN), it gave POA the approval to provide scheduled services. The contract was extended to the next 25 years upon passing of the Legislative Franchise in June 22, 1998. This was to serve primary routes, to develop secondary routes and international destinations, for the public’s convenience. Following this was the issuance of the Air Carrier Operating Certificate (ACOC) to operate scheduled and non-scheduled flights. In order for POA to deserve these certifications, 13 of their stations utilized the online Gabriel Reservation System to enable fast, accurate and customer-friendly reservation and booking services. Then, followed the cutover of all stations to Departure Control System – an automated check-in system allowing efficient passenger registration and boarding. In 2002, POA already operated 11,310 flights and carried 502,000 revenue passengers. But in 2003, the numbers went down to 8,150 flights and 457,870 revenue passengers. At present, they are maintaining a fleet size of 10 aircrafts, and having 855 employees (52 pilots, 131 flight attendants and stewards, and 672 ground personnel). Vision

To be a chosen global airline that surpasses world-class standards Mission
POA shall:
Deliver the first-rate customer service combining Filipino hospitality and world-class competence • Carry people and cargo at the least cost and earliest timeProvide its employees with an ideal working atmosphereProvide its stockholders profitability and fair gain on their investments Products

1.Festival Adventures - tour packages- roundtrip airfare, hotel accommodation, daily breakfast, and roundtrip transfers. 2.Explorer Advantage - one-time availment of booklet once and be able to fly as many as 11 times before purchasing yet another ticket. Also suitable for customers travelling in big groups. 3.Dealer’s Advantage - additional 15 kg free baggage allowance, priority service and special rates. 4.Athlete’s Advantage - for sports enthusiasts – priority service, special discounts and additional free baggage allowance ranging from 15 kg to 35 kg depending on the type of equipment the member would enroll. 5.Soaring Treasures - for frequent flyers – a tie-up with Rewards Plus. Members are credited with points for the mileage they fly and these points can be exchanged for variety of premium items. Awards/Recognitions

1.Diamond Award for the Transportation and Travel Industry sector in the 2001 Grand Prix Customer Service Awards. 2.3-time awardee of the Consumers Union of the Philippines as the “Most Outstanding Domestic Airline.” Held this distinction for 2 consecutive years running. 3.On-Time Performance (OTP) of 94% in 2002.

4.97% OTP in 2003.

Current Target Market
Primary Target Market
Professionals belonging in the middle class who travel both for leisure and business DemographicsPsychographics
Professionals between 25-45 years old
Middle class
college degree
Urban dwellers
Travels for leisure/business
Internet savvy
Travels by bus/ship on out of town trips
No frills traveler
Values convenience and safety
Loves long weekends

Secondary Target Market
Travel agencies with domestic and international services, looking to grow their partner airlines

Case Facts
Major Carrier# of passengersseat capacitypassenger load factor POA50200096500052%
Table 1: Competitive Performance Summary for 2002

Major Carrier# of passengersseat capacitypassenger load factor POA5516505020009% dec
SAL140715013790002% dec

References: Kotler, P., Keller K.L. (2009). Marketing Management (13th Ed). Singapore: Pearson Education South Asia Pte Ltd.
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