ABSTRACT
Product planning is about deciding what product and service features an airline should offer in each of its markets. For each airline, product planning is crucial in two respects. First, it is the key tool in the process of matching potential demand for air services with the actual supply of services it offers in the markets it serves. Second product planning has a direct impact on operating costs. The ultimate aim of product planning is to attract and hold customers from the market segments that an airline is targeting and to do this in such a way as to generate adequate profits. In planning new product or service improvements airlines have to balance three factors – the cost of the innovation, its marketing benefits in terms of revenue generation and the speed with which it can be copied.
