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Consumer willingness to pay for in-flight service and comfort levels: A choice experiment

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  • Balcombe, Kelvin
  • Fraser, Iain
  • Harris, Liam

Abstract

In the competitive aviation market as a result of the emergence of low cost carriers, charter airlines have had to reconsider their approach to service provision. Specifically, the reduction in service and comfort levels offered by the low cost airlines provides charter carriers with an opportunity to differentiate their product based on the quality of the offering. To consider this strategic option we employ an on-line choice experiment to examine consumer choices with respect to the bundle of services on offer when deciding to purchase a flight. With these data we use the Bayesian methods to estimate a mixed logit specification. Our results reveal that in principle passengers are willing to pay a relatively large amount for enhanced service quality.

Suggested Citation

  • Balcombe, Kelvin & Fraser, Iain & Harris, Liam, 2009. "Consumer willingness to pay for in-flight service and comfort levels: A choice experiment," Journal of Air Transport Management, Elsevier, vol. 15(5), pages 221-226.
    • Handle: RePEc:eee:jaitra:v:15:y:2009:i:5:p:221-226
    DOI: 10.1016/j.jairtraman.2008.12.005
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    References listed on IDEAS

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