Airlines in Brazil open ‘mini stores’ at subway stations to engage emerging middle class

Brazil, the largest South American country, has recently enjoyed a tremendous growth of its middle class, resulting in increased demand for aviation. In fact, the Brazilian middle class grew from 30 percent of the population in the 1960s and ‘70s to 55 to 60 percent in 2011. In 2010, the lower-middle class accounted for 34 percent of domestic tourism, almost double that of 2002. In the last 10 years, the demand for air travel in Brazil has increased by 194 percent. Much of this increased demand comes from the members of the new Brazilian middle class, many of whom are entirely new to air travel. TAM estimated that in 2011 there were going to be 10.7 million first-time flyers.

Brazil’s airlines have been developing innovative strategies as they compete to win over this new market. In the past, airlinetrends.com discussed marketing strategies adopted by TAM to target this first-time flying segment. TAM, and its low-cost competitor GOL, have continued to target the emerging middle class with novel sales channels, including sales kiosks at subway and bus stations.

During 2011, GOL opened kiosks in subway stations where they provide not only information, but also the option to book, change and/or cancel a flight. The first kiosks were opened in Sao Paulo’s Itaquera, Sé and Luz subway stations in March 2011 and GOL subsequently opened additional kiosks in Sao Paulo’s Tatuapé station, Rio de Janeiro’s Central do Brasil station, Porto Alegre’s Estação Mercado do Metrô station, and one in Salvador.

The main goal of this new distribution channel is to engage the new Brazilian middle class in aviation. According to GOL’s Market Vice President, Claudia Pagnano, “The new identity comprises items referring to airports, as well as illustrations showing the main phases of a flight.” In order to provide better service and meet the needs of a ‘typical’ subway user, GOL’s kiosk teams completed 20 days of specialized training courses that focus on the habits of the emerging middle class, selling techniques, and language skills.
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Airlines go wireless with their in-flight entertainment systems

Updated December 2011
In another sign that in-flight entertainment (IFE) is increasingly mimicking the fast developments in digital consumer electronics (witness the flurry of recent announcements by airlines to make the Apple iPad available to passengers and crew). A similar burst of activity is currently taking place in wireless in-flight entertainment (IFE) as airlines are responding to the growing number of travellers bringing their own devices on board.

Essentially an intranet on a plane that replaces the several kilometers of cables needed to connect every single seat, with a wireless network that allows passengers to connect to content on an onboard server with their own laptops, smart phones or tablet PCs, wireless IFE is a relatively cheap and light-weight solution for airlines. The system vastly expands the ‘standard’ IFE features with services such as online shopping and reservations, destination information, real-time travel information and seat-to-seat chat. Following early roll-outs by American Airlines, Delta and Brazilian LCC Gol, half a dozen of other airlines are currently testing (or have announced) a wireless IFE service.

GoGo ‘Vision’
American Airlines (AA) in early August 2011 launched the “initial phase” of Gogo’s new ‘Vision’ inflight streaming video product, which AA calls ‘Entertainment On Demand’. Passengers flying on AA transcontinental fleet of 14 B767-200s on routes between Los Angeles, San Francisco and New York JFK, can wirelessly stream more than 100 movies and TV shows from an in-flight library to “select types” of wi-fi enabled laptops (video here). American is the first airline in the world to offer streaming video to passengers via their own wireless devices from an onboard server.

How it works: Customers click on the Entertainment On Demand banner on AA’s in-flight wi-fi homepage, select a movie or TV show from the titles in the content library, create an account or log in, enter the form of payment (all major credit and debit cards are accepted) and click “rent.” Passengers can sort titles by movie or TV, genre, length of feature and other categories, and trailers are available for complimentary viewing prior to renting content. Movies and TV shows will remain accessible for viewing after the customer has landed – movies for 24 hours and TV shows for 72 hours.  The service charges an “introductory price” of USD 0.99 per TV show and USD 3.99 per movie, and will not require customers to purchase inflight Wi-Fi to utilize the Entertainment On Demand feature. See this video for more.

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