Airtran 2007 Annual Report Download - page 12

Download and view the complete annual report

Please find page 12 of the 2007 Airtran annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 92

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92

6
Distribution, Marketing and e-Commerce
Our marketing efforts are focused on price-sensitive business travelers and leisure travelers, who are vital to our success, as we seek to
position our product and stimulate new customer demand. These are the market segments in which consumers seek value and which
we believe offer the greatest opportunity for growing our revenue base.
The primary objective of our marketing activities is to develop an innovative brand identity that is visibly unique and easily contrasted
with our competitors. We communicate regularly and frequently with existing and potential customers through the use of
advertisements in newspapers, radio, television, billboards, direct mail, e-mail, movie theatres and the Internet, as well as public
relations efforts. These communications typically feature our destinations, quality of product, such as Business Class, XM radio, our
young all Boeing aircraft fleet and assigned seating, everyday affordable fares and special sales promotions. We promote the use of
our www.airtran.com website.
Customers may book flights with us through our website, other Internet websites, travel agencies booking via global distribution
systems (GDS), our mobile web program, and our own reservation call centers. The Internet is our primary distribution channel, and
during 2007, it represented more than 58 percent of our total bookings. Our Internet sales reflect both bookings made directly through
www.airtran.com, as well as sales transacted through third-party websites such as Travelocity.com and Orbitz.com. Traditional travel
agencies represented approximately 28 percent of our bookings while our reservation call centers generated the remainder.
Our award-winning website is a recognized leader in the field of airline e-commerce. Passengers can select their seats, check-in and
print their own boarding passes, purchase trip insurance, and book hotel accommodations and car rentals with Hertz.com. Our Bye-
Pass self service kiosks facilitate check-ins at the airport and provide our customers with an additional opportunity to purchase
Business Class upgrades. Over half of our customers now check-in using airtran.com or Bye-Pass self-service kiosks.
During the fourth quarter of 2006, we implemented a convenience fee for bookings made using our internal call centers. We believe
this fee is consistent with other booking channels that provide interactive travel assistance, namely travel agents. The implementation
of such fee has had no discernible impact on overall demand at our call centers. During 2007 we introduced the Bill Me Later,
Checkfree, and PayPal payment options for call center and online bookings at airtran.com. These options provide even greater
convenience to our customers and may help reduce our distribution costs going forward.
We offer our customers an affordable Business Class product. An AirTran Business Class cabin is configured with two by two
oversized seats with more leg and seat room than the typical coach cabin. Our Business Class is currently available for $40-$80 over
the full coach fare on a confirmed basis and for certain other fares on a walk-up, standby basis. Members of our A2B Corporate
program and Elite members in our A+ Rewards program receive complimentary Business Class upgrades when purchasing certain
fares.
In contrast to other low cost airlines, we offer our customers the ability to select seats in advance. Full fare passengers, A+ Reward
Elite members and members of our A2B Corporate travel program, many of whom tend to purchase tickets at the last minute, are
allowed to reserve seats at the time of purchase. All other customers may reserve seats at the time they check-in, either at the airport or
online at www.airtran.com. In May 2007, AirTran initiated a program whereby a passenger purchasing a coach ticket could also
reserve a coach cabin seat with prices currently $5 to $20 per seat reservation.
We also offer our automated frequent flier program known as “A+ Rewards.” Our customers may earn either free roundtrip travel or
Business Class upgrades on AirTran Airways, or under certain circumstances, free travel on other airlines. A+ Rewards credits can
also be earned for purchases made with an AirTran Airways A+ Visa card, when renting from Hertz, purchases from other A+
Rewards partners and in conjunction with marketing promotions that we may run from time to time.
We perform all of our marketing, promotional and media relations in-house and utilize an outside firm for advertising and public
relations.