Online Perceived Value in the Low Cost Airline Business

Abstract

The global airline industry has been hit hard by the global financial crisis (Goetz and Vowels, 2009). While full service airlines have struggled to be financially viable in this lean global environment, low cost carriers (LCCs) such as Air Asia and Firefly have changed the value proposition experienced by consumers when considering airline travel by lowering their costs and ticket prices to remain competitive. By choosing to fly with LCCs, consumers forego some of the value-added services provided by full service carriers such as complementary onboard meals, in-flight entertainment, and airline lounge services (Mathews, 2004). The emergence of low cost carriers (LCCs) has also changed the way in which consumers engage with airlines, particularly with regards to air ticket purchasing behaviour (Park et al., 2004). Due to time constraints and advancements in information technology, there is an increasing consumer preference in using the internet compare prices and purchase flight tickets (Goh, 2005).