In Person
Korean Air’s Showcase
Heather Cho, Senior Vice President Catering & In-flight sales, Cabin Service, Hotel Business for Korean Air talks to OnBoard Hospitality about the airline’s new products, route expansion and future prospects for aviation
OBH: How do you measure your airline’s success over the last few years in the face of rising fuel and competitive pricing? The airline industry has been challenged since the global financial crisis started in 2008. The global financial crisis caused the Korean currency, the Won, to weaken and resulted in a significant drop in demand for foreign travel from Koreans. To make up for the loss of demand in the domestic market, we have concentrated on the demand for inbound travel to Korea, or transfer traffic through to other countries connecting well via our hub city. This strategic move was successful, and we were able to maintain our load factors and overall revenue. The sales ratio of domestic and overseas had
been 60% and 40%, but is now the opposite. Korean Air’s competitive advantage comes
from product and service differentiation, not from pricing competition. Pricing adjustments are, however, necessary at certain times of the year and in specific regions, but basically Korean Air wants to appeal to its customers by providing better products and services. Last year Korean Air introduced its new generation A380 aircraft with a Duty Free Showcase, Celestial bar and other lounges. There are three bars on the aircraft, in addition to the Celestial Bar; there are self-serve bars in First Class and the front of Prestige Class. We also have a continual upgrade programme, which has been ongoing for the past few years and this involves upgrading our seats and in-flight entertainment system. From an operational standpoint, it is extremely important to have a very tight cost control system. Fuel prices have been relatively stable for a while but no one can predict what will happen in the natural resource market. Recently we have launched an ERP (Enterprise Resource Planning) system, which
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www.onboardhospitality.com Korean Air’s Duty Free Showcase
from the Oceania routes, or into Japan or China. Korean Air will also operate a new route to Nairobi, Kenya three times a week from June 21. The African market is a steady growth area and we plan to promote Nairobi as a future hub for the African market. Also, we are paying particular attention to
is a first to be implemented in the global airline industry. This helps us to manage our resources and control potential risks.
You are now flying from London Gatwick in the UK. Do you plan to further increase your route worldwide? Where is your business growing most? To strengthen our global network and to increase our overseas sales share, Korean Air launched its new route to Gatwick on April 28. The schedule works well for business and leisure travellers alike, not only to Seoul but also offering good connections to and
and analysing the Latin American market, such as Mexico and Peru, in order to gain future growth momentum. We are seeing remarkable growth in Chinese destinations, due to our effort to develop this market, alongside the economic growth
“To strengthen our global network and to increase our overseas sales share, Korean Air launched its new route to Gatwick on April 28”
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