Abstract
Current research on airline consumer willingness to pay and preferences focus on existing categories of products and services that are fundamental to a full-service airline. For instance, there is much research on how seat pitch, or the distance between seats, in airline economy and premium economy seats impacts a plethora of consumer behaviors. Other research also focuses on fundamental factors such as seat width, seat recline, and service quality, as well as ancillary additions (i.e., baggage, meals, etc.), all of which have grown to become expected insertions or add-ons to a full-service airline ticket. Innovative products, on the other hand, are different, as they are features that are not expected by consumers and ones that are not critical to an airline seat’s function. Recently, airlines have begun implementations of innovative features across all classes of service. Examples of such innovations include Emirates’s first-class showers aboard Airbus A380 aircraft, Virgin Atlantic’s inclusion of business-class on-board bars, no forward seat recline from Lufthansa’s Allegris premium economy, the skycouch aboard Air New Zealand economy, and well-being zones for all cabins on Qantas project sunrise flights. From this short list of examples it becomes apparent that methods by which to differentiate do not pertain solely to a single flying class, and with this increasing behavior from airlines it is crucial to obtain an understanding regarding how these innovations impact consumer willingness to pay.
Innovative features are especially interesting within economy class. In an environment where many airlines are restricting space and removing enhancements to economy class, a few other airlines are doing just the opposite. The aforementioned examples of Air New Zealand and Qantas are a few of such, but it is especially important to understand how economy class innovative features are perceived by passengers, as these are the ones that will be experienced by the largest number of people. Therefore, this study, seeks to understand this exact gap in current knowledge. To do so, I will use a conjoint analysis to study willingness to pay for both fundamental and innovative features – using fundamental features and their existing knowledge as a baseline. From the conjoint results, I will be able to infer, conditional to fundamental features, how much customers are willing to pay for a set of new innovative features.
In this pre-analysis plan, I outline the methodology, hypothesis, variables, sampling, and data collection procedures.