Contemporary issue in marketing - Airline industry on service quality Essay

Contemporary issue in marketing - Airline industry on service quality and relationship marketing - Essay Example Airline industry is a key economic strength of any country because airline industry has big impact on other industries such as manufacturing, finance and tourism. Presently, the worldwide airline industry comprises more than 23,000 aircrafts, offers service to more than 3700 airfields all over the world. In the year 2006, it had been calculated that approximately 28 million flights transported more than 2 billion passengers worldwide. For the last 20 years, the air travel had increased considerably by 5%. In the US, the aircraft industry contributes 8% of GDP (MIT, n.d.). According to IATA (International Air Transport Association) the forecasted global air journey increased almost 5% annually from the year 2000–2010. The most dynamic growth of aviation industry had been seen in Asia/Pacific region compared to Europe and North America. In Asia/Pacific region the aviation industry is increasing by almost 9% annually. In the 1990s, the aviation industry had suffered heavily due t o economic recession and Gulf war. The member airline of IATA had experienced losses of almost 20.4 billion USD from the year 1990 to 1994. Subsequently, Aviation industry had realised the importance of service and customer relation and thus certain airlines had invested a lot to improve the quality of service offered to customer. Many new attractive strategies had been introduced to draw and retain customers (Standford University, 1999). Importance of Service Quality in Airline Industry In aviation industry the competition is strong and it is growing rapidly. The airline companies had realised the need for providing more attention towards customer in order to face the competition because customers are the primary element of every business. Good customer satisfaction can bring profitability to an airline company and it can be achieved by good service. An efficient service quality is characterised by good customer segmentation, tailored service, measuring the feedback of customer and measurement of company performance (Bozorgi, 2007). Customer satisfaction is the feeling or attitude towards a service. If a customer is satisfied about the service, in future the customer will engage in purchasing the service again. Thus, customer satisfaction and service quality is interrelated with each other. The reason for dissatisfaction in aviation industry can be caused by late departure of flight, reservation of ticket, poor catering service and bad attitude of air crew members towards customers (Bozorgi, 2007). In the year 1987 and 1988, the bad customer service had been recorded in the US aviation industry regarding flight problem, reservation problem, and refund of money, customer service, smoking activities, tourism issues and others. These factors have led to dissatisfaction of customers, and for that reason the customer complaints had grew over 500% in the year 1987 (Bozorgi, 2007). Perceptions of customers and service quality are useful in forecasting the effectiven ess of a company. Many companies intend to employ customer service based