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Author Topic: Is marketing and CI worth the money?  (Read 474 times)

Offline Cornishman

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Is marketing and CI worth the money?
« on: March 04, 2019, 11:55:53 AM »
I'm seriously questioning the value in spending huge amounts of money on Marketing and CI in this game.  We are always told and led to believe that if you want to be a big player and operate from one of the major global airports then a relatively high CI is almost essential and will deliver better results.

But I have been doing a bit of analysis on a number of my routes where I have competition and a strange statistic crops up which seems to be apparent in sufficient places to suggest that a high versus low CI makes no difference at all on long haul international routes.

Don't get me wrong, I'm not moaning about a competitor (actually, bloody good luck to them for not spending much money on CI and still getting great results), It's the statistic and the calculations behind it all that I question. So not using actual airline names - here's a classic example of what I'm seeing:

Company A has a CI of 95%
Company B has a CI of 30%

A given route of 4630nm across the Atlantic has a pax. demand of 190 / day and only companies A and B are on the route. Both companies offer a non-stop flight and both companies flights depart and land all legs within the local hours of 07h00 and 22h00

Company A with a 95% CI uses a L.1011-500 and Company B with a CI of 30% uses an A310-300. 
We only know that Company A sets prices at about standard base level prices. We don't know Company B price policy.
Both A and B have flown the route for long enough now that both would have a 100% RI.

So how on earth is there a steady majority in the favour of Company B - currently B receives 60.24% of the pax demand, and company A (with only a slightly larger plane but has slightly faster flight times) only gets 39.76%.

If this was a lone statistic I wouldn't bother asking about this, but I see it has a pattern - and not only with comparisons between Company A and B, but other routes where Company C who also uses A310-300 and has an even lower CI of only 29%... very similar results on some of their routes !

So my question is, what is happening with CI ratings to permit these sorts of results?

Offline Zobelle

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Re: Is marketing and CI worth the money?
« Reply #1 on: March 04, 2019, 12:21:19 PM »
Age of plane and as you mentioned you don’t know their prices.

Offline Cornishman

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Re: Is marketing and CI worth the money?
« Reply #2 on: March 04, 2019, 12:49:49 PM »
OK, airline A uses 7 individual L.1011s on this route. The oldest of them is 2.07 years old. Airline B has an average age of their A310 fleet of over 7 yrs, so no way that stat can have anything other than offering maybe a better result for A over B, but this is not the case.
« Last Edit: March 04, 2019, 12:56:03 PM by Cornishman »

Offline schro

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Re: Is marketing and CI worth the money?
« Reply #3 on: March 04, 2019, 06:24:36 PM »
The market share percentages are heavily influenced by maintenance and cancelled flights.... thus, can be difficult to tell from a single snapshot as to what is going on there....

Offline Cornishman

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Re: Is marketing and CI worth the money?
« Reply #4 on: March 04, 2019, 09:56:40 PM »
Ok, so I need to monitor this ... I do indeed have one plane out on a C check. I'm quite surprised that alone has such a harsh result but when it's back on duty I'll watch where this goes.  Thanks Schro.

 

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