AIRPORT MARKETING ENVIRONMENT

INTRODUCTION
AIRPORT’S MACROENVIRONMENT
POLITICAL AND LEGAL FACTORS
ECONOMIC FACTORS
SOCIO-CULTURAL FACTORS
TECHNOLOGICAL FACTORS
ENVIRONMENTAL FACTORS
AIRPORT’S MICROENVIRONMENT
THE COMPANY
SUPPLIERS
MARKETING INTERMEDIARIES
CUSTOMERS
STAKEHOLDERS
INTRODUCTION
The marketing environment includes the actors and forces outside marketing that
affect marketing management’s ability to build and maintain successful
relationships with target customers.

Airport marketing activities cannot be considered in isolation. Every airport

operates within a marketing environment that plays a key role in influencing the
airport’s marketing strategy and planning decisions.
Airport marketing environment consists of three main sections which are
microenvironment- macroenvironment and internal environment.
The microenvironment consist of factors and forces close to the organisation that
have a direct effect on its ability to serve its customers and on its marketing strategy.
These consist of the organisation or company itself, suppliers, marketing
intermediaries, customers, competitors and stakeholders.

By contrast, the macroenvironment consist of factors and forces that belong to the
broader society, affecting all organizations operating in a particular market. These
factors influence the microenvironment and hence the marketing activities
undertaken.

There are number of ways of categorising such factors, such as with a PEST
(Political, Economic, Socio-cultural and Technological) analysis, or an extenden
PESTEL (Political, Economic, Socio-cultural, Technological, Environmental and
Legal) analysis or some similar grouping.

For this presentation PESTE approach has been adopted.

AIRPORT’S MACROENVIRONMENT
POLITICAL AND LEGAL FACTORS
These include all government policies and associated regulations, conventions and
laws. Consideration of these involves an assessment of general issues such as
political stability, ideology and motivation, as well as specific policies that directly
affect the organisation.

There are many political and legal factors for the airport industry, but it is difficult
to view these in isolation from other parts of the aviation industry such as airlines
and air traffic control because of the close and strong relationship between these
sectors.
Aviation’s international nature means that most governments do not have total
freedom to initiate policies that are fully independent of those of other countries.

Many decisions related to aviation determined at a global level through

International Civil Aviaion Organisation (ICAO), which is an agency of the United
Nations and has around 190 countries as members.

Many policies have emerged as a consequence of the Chicago Convention of 1944,

which established an international regulatory air transport system to deal with the
many aspects of aviation.

In terms of World’s political environment, there is a ongoing threat of terrorist

attacks, war or internal conflict. This has an impact on both the demand and supply
of airport services and has created a more uncertain operating environment.

This may couse airlines to reduce, suspend or withdraw services as demand falls
because of safety and security concerns.
ECONOMIC FACTORS

Economic factors include both national and global factors that can have a major
impact on the demand for the products of an organisation, as well as the way it
operates and make decisions.
Some of the most important factors include income growth and distribution,
inflation rates, exchange rates etc.
Demand for aviation services has always very closely followed trends in income
growth.

When income or gross domestic product (GDP) rises, passenger and cargo volumes
increase; when GDP falls, the reverse situation generally occurs.
Likewise, business travel and cargo traffic will mirror the peaks and troughs of
business and trade activities, which are also closely linked to the economy.
SOCIO-CULTURAL FACTORS

Social factors related to population and demography ( such as age, household,

education, occupation) and cultural factors (such as attitudes, preferences, values,
beliefs, religion and lifestyle) can have many influences on the market potential and
customer needs of an organisation, end help to explain trends and fashions.
For aviation services these factors, combined wih the also economic factors, will
affect the volume and nature of passenger.
TECHNOLOGICAL FACTORS
The technological environment is the fastest changing feature of the
macroenvironment. New technologies and technological advances can create new
products and new processes that can benefit customers as well as the organisation
providing the product.
Technological developments can reduce costs, improve quality and lead to
innovation.
Technology has always played a major role in the development of the aviation
industry. Advances in aircraft technology and the arrival ot the new aircraft types
have strongly influences the types of service that airlines offer.
ENVIRONMENTAL FACTORS

Environmental factors have always been a key feature of the marketing

macroenvironment but have received a greater profile in recent years as
governments and industry have paid more attention to achieving higher levels of
environmental sustainability.
That include factors such as global warning, pollution control, waste disposal and
conversation of end other natural resoruces.

In spite of the fact that aircraft models have become significantly quiter and cleaner
over the years, the growth in air travel demand, coupled with greater public voice
about environmental issues, has meant that it is important now, more than before,
for an airport operator to deal effectively with these concerns to ensure the
continued well-being of the airport.
Many airports differentiate their charges by noise levels, and an increasing number
do this for emissions as well. (London Heathrow, Frankfurt, Zurich, Stockholm)
The result is that the airports may become expensive for airlines that have older
fleets.

AIRPORT’S MICROENVIRONMENT
Microenvironment consists of the actors close to the company that affect its ability
to serve its customers.

THE COMPANY
The company aspects of the microenvironment refers to all the internal functions of
the organisations. Each of these will influence marketing decisions.
Marketers must work closely with top management associated with all these
activities and ensure that their maketing plans are consistent with overall corporate
intentions and with the strategy of all the other departments.

There is considerable variation in the organisational structures of airports and in

the location of marketing activities within these structures.
Organisation Structure Chart of Copenhagen airport;

SUPPLIERS
Suppliers provide the organisation with the goods and services it needs to create its
products. In the manufacturing industry, this is relatively straightforward as it will
relate to materials that are needed in the manufacturing process.
Poorer quality or more expensive materials will have a direct impact on the final
product and its price.
It is very significant for organisations to develop strong and effective relationships
with their suppliers.
Air Traffic Control, security, ground handling and retail are some of the examples for
aviation sector.

MARKETING INTERMEDIARIES
Marketing intermediaries are firms that help organisations promote, sell and
distribute their products to customers.

4 types pf marketing intermediaries,

Resellers,
Pyhsical Distribution Firms,
Marketing Services Agencies,
Financial Intermediaries

CUSTOMERS

Customers are individuals or firms that buy the goods and services an organization
produces: satisfying their needs and and requirements is vital for the success of any
organisation.
In general terms there are usually 5 different customer markets.
The airport industry is rather unusual when this concept is applied to sector.
The main two customers are often defined as airlines (which pay airports directly
for rights to use their products and services) and passengers (who use airport
products and services but do not pay airports directly).
Most airports tend to define both airlines and passengers as key customers,
whereas some airlines consider passengers are solely their customers and
themselves as the main customers of airport.

In addition the passengers, there will be other individuals that can be considered
airports customers. These include who see off or meet passenger. Staff employed
in any of the organisations at the airport may also use the airport facilities that’s
why they are also can called customers.

COMPETITORS
Competitors can be simply defined as other organisations that create and market
products that are similar to, or can be substituted for, the products on offer from
organisation whose marketing environment in under consideration.
All potential competitors must be continually monitored to assess their relative
strengths and weaknesses, and to determine how to gain a competitive edge over
them.
Airport competition is a complex area, and for each airport the number and nature
of the key competitors will depend numerous factors. (Location, Range and Quality
of Facilities, Services on Offer, Price )

STAKEHOLDERS
Stakeholders or publics are groups with an interest in (actual of potential), or an
effect on, an organisation’s ability to successfully implement their marketing
strategy.
In general, these groups can be classified as
Financial (e.g. Banks, investors)
Govermental (e.g. Government departments, agencies)
Media Related (e.g. Newspapers, television)
Citizen-Action Focused (e.g. Consumer organisaitons, pressure groups)
Local (e.g. Resident and community groups)
Internal (e.g. Employees, managers)