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The Rise of the Mileage Programs: The Case of Korean Air Alliances - Dissertation Example

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The Rise of the Mileage Programs: The Case of Korean Air Alliances Introduction The beginning of 2012 marked the modification of airlines…
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Download file to see previous pages Airline alliances or partnerships refer to concurrence between airlines to work together at a considerable level. Such alliances provide international passengers with a set of connections and conveniences. These airline alliances are also noted to aid in marketing and brand improvement through the connections to other countries (Petersen & Winship, 2005, p. 156). Sky Team is an alliance that consists of Korean Airline, Aeromexico, Aeroflot, Air Europa, Middle East Airlines and Kenya Airways. Sky Team has adopted the use of mileage program. The passengers have greatly benefited from Sky Team airline alliance mileage program (DIANE Publishing Company, 1996, p. 212). Largely because of the growth of international tourism and the globalization of economic activities, the demand for air travel among countries across the world has rapidly grown. Vedder (2008, p. 67) notes that there has been a notable increase in passenger traffic over the past few years to and from Korea. Airlines have cooperated and collaborated with their rivals to remain aggressive and mutually grow into international market. It may seem difficult and downright challenging for an organization to make it in a very competitive business industry. In reference to Gossling et al. (2009, p. 56), the process of collaboration is a significant approach to not only reducing risks but also maintaining customer care, brand loyalty and creating brand awareness. The aviation industry has experienced downright alliances frenzy for the past few years. Sky Team alliance was founded in 2000 by Korean Air, Air France, Delta Airlines and Aeromexico before growing to its current membership. Sky Team has increased the number of carrier members and destinations, thus offering customers a greater connectivity to the rest of the world. In addition, Sky Team has continuously offered mileage programs to its passengers. Korean Air, a founding member of the Sky Team, has 145 aircrafts which operate in more than 121 destinations in more than 41 countries in the world. Korea Air is among the twenty best airlines in the world. Korea Airline has expanded its operations’ quality and quantity over the past few years (Tretheway, 1989, p. 445). The improved management system and the adoption of the flight flier program have assisted the company in attaining significant results. It is the largest flight operator in Asia, serving more cities and regions than any other airline. Since 2004, Korea Air has been one of the most successful and largest business airline freight operators (Haddad, 2000, p. 129). The growth of Korean Air has contributed to the growth of the economy and other sectors of the economy. Aim This paper aims at identifying some of the benefits that accrue to the passengers from the use of the mileage program in Sky Team, particularly Korean Airline, and ways on how this can be improved to increase brand loyalty. The passengers have reaped many advantages and benefits for using Korean Airline, but still this can be improved to increase loyalty and satisfaction. The mileage program adopted by Korean Air has benefited passengers by providing them with the opportunity to earn sky pass miles and attain bonuses from many airline and hotel collaborations. Passengers have continuously enjoyed expressly cut rates from organizations such as Hyatt Hotels, American Express, and Hertz rental cars (Storm, 1999, p. 25). The more a passenger accumulates miles, the more they benefit from the program. The alliances and the use of the mileage program has necessitated a global network without incurring ...Download file to see next pages Read More
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