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Flair Airlines Overview1
Company Profile
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Canada’s first independent ultra-low-cost carrier (ULCC),
headquartered in Edmonton, Alberta
Launched in 2017
Destinations across Canada, USA, and Mexico
Focused on providing affordable air travel to Canadians by
unbundling baggage and add-ons from a ticket’s price
Growth oriented; focused on developing the fleet to 50
aircraft over the next 5 years
Chief
Executive
Officer
Stephen Jones
Chief
Financial
Officer
Joseph Lee
Chief
Commercial
Officer
Garth Lund
Destinations
The Fleet
Boeing 737
MAX 8
13 aircraft total
Management
Boeing
737-800
3 aircraft
Chief Pilot
Brian Stokes
3
The Problem at Hand
Initial Objective Statement
Define a price-sensitive target market within age demographics and develop a corresponding
marketing strategy and implementation plan to drive demand and boost sales, for September
2022.
1
Target Ages 18-24
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3
Drive Demand in Off Peak
Periods
Capture and Retain Customers through
Targeted Marketing Initiatives
Revised Objective Statement
Define a price-sensitive target market factoring demographic and psychographic attributes to develop a corresponding
marketing strategy and implementation plan to drive demand by addressing Flair's off-peak load factor, beginning
September 2022.
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Consumer Research23
Phase 1
Phase 2
2017 Travel Expenditure demonstrates sizable
markets in the selected segments
Using consensus data, the price sensitive market was divided into
married travelers, travelers aged 18-24, and senior travelers to screen
for targetability.
Married couples removed from
target demographic
Seniors removed from
target demographic
18 – 24-year-old
demographic
Note: Omitted traveller characteristics because of inability to hyper-target: (1) Educational Attainment; (2)
Profession; (3) Gender Specific; (4) Age-specific where stage of life varies a lot; Income > $50,000
Removed due to
unpredictable
travel patterns
Removed due to
inability to trade
amenities and
comfort 24
Travelers aged 18-24 aligned will with the high price sensitivity since
many have lower income and less disposable income. They also tend
to fly during the off-peak season (returning home for school breaks).
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Target Segment Primary Research
To confirm the segmentation given by the research, interviews were conducted with participants to provide concrete evidence. Once the
demographic was determined to be a lucrative choice, further surveys were distributed to gain more relevant and specific data.
Interviews
Surveys
Process
Process
30
18–24-year-old
individuals
interviews
Interview Findings
Annual average expenditure:
$980
Price was the most important
factor to this group of travellers.
With plans to have a pilot
operation, investigations
were required on the
buying and traveling
habits of Western
students.
Online Survey
Survey Findings
7 additional
factors
84.7%
of students
69.3%
of students
couldn’t just be captured by age
and needed to be further
examined.
would be somewhat
responsive or very
responsive to student
discounts
would be somewhat likely
or very likely to use an
alternative airport if the
cost of the flight included
transportation
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The Ideal Flair Client
Using primary and secondary research, a persona of Flair’s most beneficial consumer was produced.
Age
Income
Occupation
Brand Loyalty
Trip Motivation
18-24 year olds
93% of Gen Z are price conscious and willing to fly when it’s perceived as good deal25
Full-time
student
Income: Negative correlation between income and magnitude of price elasticity26
Occupation: Students’ travel choices are primarily driven by costs paid for
transportation.27 Cost considerations played a major role in influencing decisions.
Lifetime
Students start university with their minds most open to trying new brands as they
experience financial independence = where they make their first and last brand
choices.28
Leisure
Factors Influencing Choice of Air Carrier for Students
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Carrier Attributes
Destination &
Length
Frequency
Short-haul
domestic30
Seasonally
Flight
Preference3
Carrier Pricing
Traveler Attributes
Carrier Choice
Most important factor
Service Quality
Short-haul flights- service quality is similar for
legacy and low-cost carriers
Market Presence
Minimal impact on choice, suggests big names have
little advantage
1
Back to Agenda
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Option 1: The Bus
Convenience
Survey
Results
Interview
Results
Smaller airports may have
less transportation options
and may be further away
from major cities, making
them inconvenient
Over 50% of students
surveyed stated cost of
getting to airport being a
deciding factor in airport
choices
Most interviewees stated
door-to-door costs as being
the most important factor
when making travel plans
Fixed Costs
Secondary airports give
ULCCs an advantage over
legacy carriers as they have
lower fixed costs
Option 1: Offer a shuttle bus that would take students from the university to the airport that is included in the
price of the flight
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Option 2: Buy-One-Get-One Free Student Promo
Option 2: Offer a 2-for-1 promotion exclusive to students: purchase a higher priced ticket during peak season
and receive a free ticket during the off-season
“College kids love free stuff ” 34
New
Customers
Operational
Advantages
Brand
Enthusiasts
35
According to The Pollack
Group, providing students with
discounts can be a great way to
attract new college
customers and maintain
existing ones
94% said an exclusive offer
would get them to shop at a
brand more frequently
Survey
Results
36
Addresses core issue
High fixed costs to fly so adding
a free passenger costs little
Customers will need to pay for
luggage=pure revenue
86% of university students tell
their friends about student
discounts they had received
97% of the students with a
student discount will try out a
specific business
Over 75% of students feel loyal
to specific businesses after
graduating if they were
provided a student discount
84.7% are highly responsive to
student discounts
57% are responsive to 2-for-1/
BOGO promotions
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Marketing Overview I
Western University students
contain a sizeable market48
Market penetration can be
done via two alternatives
BOGO
Bus Promo
I. See: Slide 27 for detailed marketing analysis and sources
Note: Booth and Swag indirectly convert customers and
pads other conversion rates
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Financial Analysis of Marketing Initiatives I
2021-22 Pilot
Conversion
BOGO Promo –
Revenue /Converted
Customer
$382
ROMIII: 1099%
Additional Trips
Marketing
Spend/Customer: $32
On-Peak: 1768
Off-Peak: 1768
Exclusive Options: Marketing will be catered to BOGO or Bus Promo
884
Customers
Bus Promo – Revenue
/Converted Customer
$300
ROMIII: 842%
Additional Trips
Marketing
Spend/Customer: $32
On-Peak: 0
Off-Peak: 1768
Pilot Expansion Offers Lucrative Returns
Canadian University
landscape offers lucrative
expansion opportunities
of pilot initiative
I
23 Universities in
Canada with
10,000+Students
29664
Students/University
(Average)
See: Slide 28 for detailed marketing analysis and sources | II Return substantially high due to Flair's ability to leverage existing load capacity
III
Pilot Expansion Multiple is the number of times Flair can expand this marketing initiative assuming the same mix of geographical origins as Western University
16.3x Pilot
Expansion
MultipleIII