An Impact of Advertising and Pricing on Consumers Online Ticket



Abstract—This study examines the impact of advertising and

the relationship between the advertising and pricing. It also

determines the level of consumers online purchasing of AirAsia

e-ticketing among students of Asia Pacific University (APU) in

Malaysia. The factors which are mainly investigated are the

advertisements, pricing strategies and e-purchase of AirAsia

tickets. Many of us believe that advertisements are deceptive

whether it is in online or offline form. However, in fact, it still

influences the consumers to purchase. This research provides

the in-depth understanding of how AirAsia applies factors

such as “Advertising and elements in advertising like splendid

pricing strategies” to impact the purchase decisions. A

quantitative approach of using questionnaire was chosen for

data collection.

Index Terms—Advertising, pricing, AirAsia, animated ads

and poster.

I. INTRODUCTION

Online consumers’ behavior is often assumed to have its

own properties and to be fundamentally different from a

behavior observed in the physical world. Gradually online

purchasing trend started to emerge and consumers find it

very convenient and easy to shop online.

In 1994 Air-Asia was established and began its

operations on 18-Nov-1996. Company experienced (MYR

40 Million) worth of debts in 2001 but now it’s recent

survey shows that the Airlines generates (1.65 billion) of

profit in 2012, Air-Asia offers low price ticket deals online

which attract thousands of travelers in minutes as well as it

is the world most low cost fares Airlines carrier. This is due

to innovative pricing strategy and continuous online adverts.

Mainly, several factors such as “Advertising”,

“Consumer Attitude” and “Pricing” influences consumer’s

purchasing. Each factor played different role to persuade

consumers purchasing Intention. Customer’s trust on online

shopping system was hard to attain but Advertisements on

various mediums not only attains consumers trust but also

aware public about the core benefits associated to online

purchasing besides, influence them to go for online

purchasing. To place an effect on consumers purchasing

intention toward online buying, advertisers depict the

benefits associated with online purchasing like Low Pricing,

Ease of Use and wide range of Brands availability. However,

this project seeks to explore the factors such as Advertising,

and pricing which contributes in influencing consumer’s



Manuscript received July 1, 2014; revised September 25, 2104.

Ahmed Shehroze Yasin and Leo Gertrude David are with Asia Pacific

University College of Technology & Innovation, Malaysia (e-mail:

[email protected], sherrythelo[email protected]).

online purchasing specifically online ticket purchasing of

Air-Asia Airlines.

II. PROJECT AIMS AND OBJECTIVES

A. Aim

The aim of the project is to create print and animated

advertisement for Air Asia Airlines.

B. Objectives

 To examine the impact of advertising

 To examine the relationship between the advertising

and pricing

 To determine the level of Consumers Online

Purchasing of Air Asia e-ticketing among students of

APU in Malaysia.

III. REVIEW OF LITERATURE

Purpose of this chapter is to review the relevant literature

in order to identify gaps, therefore enabling the researcher to

build a conceptual model for testing and identifying the

factors influencing consumer online ticket purchasing of

AirAsia Airlines.

A. Advertising

According to Stanton, "Advertising consists of all the

activities involved in presenting to an audience a non-

personal, sponsor-identified, paid-for message about a

product or organization [1]." Additionally, of all marketing

weapons, advertising has leading impact on viewers mind,

as its exposure is much more. Advertising is one of the key

elements in building a brand, creating awareness, providing

info, increase sales, to inform the intermediaries and expand

the markets.

B. Advertising and AirAsia

Air-Asia has multi announcement or advertisement

platforms with high visibility. It is ranging from online, on-

ground, as well as on-board to inflight magazine

advertisements. Air-Asia usually come up with a unique and

effective ways to reach a broad spectrum of consumers.

Online Advertising is one of the major approach that Air-

Asia agree to. According to Air Asia of 2013, Mostly, Air

Asia ads is to create an image of safe and cheap airlines. Air

Asia has to emphasize on cheap price and safety in its

advertising because these days what public find is mostly

cheap but unsafe flight. Air-Asia went into intensive general

advertisements and other high profile activities, which

contributed, to the high offering of their firm's image. They

An Impact of Advertising and Pricing on Consumers

Online Ticket Purchasing

Ahmed Shehroze Yasin and Leo Gertrude David

International

Journal of Innovation, Management and Technology, Vol. 5, No. 5, October 2014

383

DOI:

10.7763/IJIMT.2014.V5.545

came with a brand “ Now Every One can fly” These points

of contact with their target customer help them to mold their

image, which in turn created loyalty from their customers

[2].

Furthermore, Advertising plays a significant role in

building a brand and when Air Asia came up with a brand

“Now Every One Can Fly” then innovative advertising

boosted Air Asia Airlines and created its strong image of the

World’s Best Low Cost Carrier.“ Building strong brands is

one of the most essential goals of product and brand

management as strong brands will result in the realization of

higher long-term and short-term returns for organizations

[3]. According to Branding is now a crucial component in

the airline industry, just like any product [4].

Air-Asia is one of the largest low cost airlines in the

Asian region. There is Variety of media options that

AIRASIA use as their advertising options such as inflight

magazine, regional websites, Meal tray backs and Overhead

lockers, overall all Air Asia adverts try to turn their

consumers mind towards E-ticket purchasing of Air Asia.

According to probably the most important effects of

advertising to the airlines are its long-run influence on inter-

industry market shares. Continued advertising has a

cumulative response. It produces an increased awareness of

air transportation through constant exposure, and may create

an identification of a particular carrier or carriers with a

route, market, or region [5]. LIM and MOHAMED in his

previous studies found that Advertising in the print media

and Internet is also widely used by Air Asia especially

during its sales campaigns on free or low cost seats and

internet is an excellent medium for inducing consumer to

purchase [6]. Furthermore, Air Asia’s advertisements and

promotional activities that Air Asia is working to position

itself as the leader of low budget airlines by lowest price of

tickets and even giving free tickets to customer [7]. The

airline is succeeding because of its aggressive marketing,

creative branding, and aggressive advertising (Wanvari,

2013) CEO of Air Asia in South India.

Hypothesis: Advertising had an impact on AirAsia

Airlines customers mind.

C. Advertising and Pricing

Karray and Herran in his study stated that we study the

relationship between pricing and advertising decisions in a

distribution channel where national brands are competing

with a private label. We solve a three-stage game-theoretic

model where the national brands compete on advertising

and prices, and the retailer is investing in umbrella

advertising for the store and is selling a private label.

Additionally, the obtained equilibrium strategies highlight

the significance of determining the complementary or

competitive roles of advertising to better understand the

relationship between advertising and prices, and to better

adjust strategies to varying rivalry levels in the marketplace.

Specifically, we find that advertising that develops the

national brands' sales gives pricing power to manufacturers.

However, persuasive advertising can create different effects

on prices depending on the strength of the advertising effect

and on the price competition level between the national and

the store brands [8]. Furthermore, According to the report of

we find that advertising stores substantially cut only prices

of the products or services that they advertise. Prices of

other products and services, at both advertising and non-

advertising stores, do not change. Besides, we find no

reductions in price dispersion across stores [9].

Furthermore, Taylor in his previous studies found that

Advertisement is indispensable for both the sellers and the

buyers. However, it is more important for the sellers. In the

modern age of large scale production, producers cannot

think of pushing sale of their products without advertising

them. In addition, advertisements are among the most

visible of the marketing strategy and have been the subject

of a great deal of attention in the last ten to fifteen years

[10]. Advertisement cannot only change emotions but give

subliminal message [11]. On the other hand, stated that the

relationship between advertising and price is important

because the welfare effect of advertising depends upon the

price effect of advertising [12].

Hypothesis: Advertising and pricing both are different in

terms of effects, consequences and influence, depending on

different situations. However, the relationship between

advertising and pricing is significant because advertising

supports pricing awareness in market and strategic price

placement makes ads more appealing to consumers.

D. Pricing

The term “price” in general its meaning is “value”. In

modern economies we often catch the term known as

currency. Previous studies such like stated that adjusting the

prices is called pricing strategy. A pricing strategy has a

goal to establish an optimum price with current profit

maximization, maximization of the number of units sold, etc.

Additionally Price is a major parameter that affects industry

revenue significantly [13].

E. Pricing and AirAsia

Nowadays, when everyone wants to take plane to travel

to other place, their first choice is almost will be Air Asia.

The Motto of Air Asia, “Now Everyone Can Fly” is

remembered by everyone and it gives everyone a mindset

that Air Asia Airlines is a very low cost airline and it

becomes a good choice for everyone. Air Asia flies to over

61 domestic and international destinations with 108 routes

as well as it operates over 400 flights every day from hubs

situated in Thailand, Indonesia and Malaysia with a fleet of

72 aircrafts.

Previous studies such as like stated that Malaysian was

been first introduced to E-ticketing by Malaysia budget

airline Air Asia which fully implement E-ticketing travel

system for 10 domestic flights. Since year 2007 Air-Asia

has been actively expand their route portfolio to

international flight. The use of E-ticketing has bring benefits

to many areas, firstly environmental friendly by reducing

the use of paper, secondly the cost saving from printing

paper ticket can in turn to reducing the air travelling cost,

and thirdly the airlines company can wisely use the records

of E-tickets in enhancing the customer loyalty program [14].

Additionally, Grant R. stated that Air Asia engages in direct

sales through its web site and call center. As a result, it

avoids paying commissions to travel agents [15]. According

to research 83.5% of the respondents have used the e-

ticketing to buy airline tickets and 60% of this group visited

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Journal of Innovation, Management and Technology, Vol. 5, No. 5, October 2014

384

Air Asia website. The Malaysia Airlines Bhd. has followed

Air Asia by 22.6%. Probably the difference in these two

amounts has been resulted from the low cost benefits of the

Air Asia [16]. Moreover, According to Air Asia penetrated

the airlines industry by gaining the competitors’ customers,

improving the product quality and its level of service,

attracting non-users of the products or convincing current

customers to use more of the company's products through its

RM0.99 promotions [17].

Hypothesis: Various types of consistent promotional

advertisements, pricing and online easy accessible is the

major factor for purchasing of Online Air Tickets of

AirAsia.

IV. METHODOLOGY

This is a Quantitative study, In terms of Objectives. This

is an explanatory study. Looking into the sampling

methodology, the population in this study is Malaysian

studying youngsters. The sample in this study refers to those

studying youngsters in Kuala Lumpur district studying in

APU University Malaysia. In terms of sampling

methodology, this study had used convenient sampling

methodology.

Since, the total older APU students was approximately

8000 APU based on student service 2010 .which considered

as a large sample group. The results form Raosoft Sample

Size Calculator suggested that (68) is the minimum sample

size of the survey (marginal error =10 %; confident

level=90 %)

A convenience sampling method was conducted among

49 APU students outside the university main library. This

sampling method was chosen due to the unavailability of the

list students visiting the library and thus, it is impossible to

get the absolute number of the patrons. Besides, researchers

can meet different students from different faculty at the

library. This is to avoid bias for surveying all the

respondents from particular faculty.

V. FINDINGS

A. Analysis for (Part A)

 From total respondent 17 associate Red Color with

Coca-Cola and 16 named AirAsia. It means AirAsia

is on 2

position compare to other famous brands

such as Emirates Airlines. AirAsia is well-known

and easily recognized among people due to its color.

 From Total respondents 33% responded the

“Website/Internet” and 23% responded from

“Friends”. It means the Website/Internet and Friends

or word of much are the main source of information

about Air Asia.

 Adverts on Internet and TV mainly assist Air Asia to

reach their target group.

 Air Asia Slogan “Now Everyone can fly” has a

strong impact in Air Asia ads.



The most appealing AirAsia advertisement is the one

which gives an emphasis on price point (Rational

ads).



Results divulge that AirAsia advertisement influence

43% of the respondents only up to the “Desire to

purchase” and 31% influenced to “Explore”.

Moreover, 20% of advertisements “just leave

positive impression” on respondents. So, overall

AirAsia advertising can be considered effective.



AirAsia “Internet/Social Media” advertising is more

effective approach which they can undertake to

create an impact on their target audience.



39% of the respondents remember AirAsia

advertisement only “Few Hours”, 29% remember

“One Week” and only 22% remember AirAsia

advertisement up to “One Day”. So, AirAsia

advertisement must be improved which can remain

for a long period in their travelers mind, this can

result in sales of AirAsia tickets.



Most of respondents 47% responded “YES” that

they think or planned to travel via AirAsia in result

of their ads, and other 33% responded Maybe and

only 20% responded NO. Overall, it shows that

AirAsia ads are good and have strong impact on

consumers of AirAsia.

Analysis for (Part B)



Majority of the respondents 61% are only “Agree” to

the statement that advertising is persuasive and 27%

are “Strongly

Agree” to the same statement. This

depict that if AirAsia

emphasis on low price,

promotions etc. in their adverts then in result it can

easily persuade their target market via advertising.



If AirAsia give more emphasis on online adverts, it

may result in their best interest.



AirAsia adverts can influence their consumers to

purchase online.



AirAsia pricing strategy works well in Airline

Industry and its price discount strategy really attracts

AirAsia travelers.



Majority of the AirAsia respondents are satisfied and

they feel they are getting a good buy.



AirAsia consumers can go for another brand or

Airlines if it will offer them more price discount.



From the total respondents 31% are “Neither Agree

or Disagree” that they will buy the same brand even

they have a price discount on the other brand.

Moreover, 47% are “Agree” with the above

statement. This shows that 47% respondents would

stick to the same brand even if they get price

discount on the other brand and on the other hand 31%

are confused in making decision whether to change

the brand or no because of price discount.



Price discount has a powerful tool that AirAsia is

using to attract travelers. Consumers prefer price

discounts more than their favorite brands.



Price discount has a powerful impact on consumers

and it can positively change the consumer intention.

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So, AirAsia should give more importance to their

pricing policies to attract more travelers.

 If AirAsia maintain its low fare or price discount

strategy then there’s a possibility that AirAsia sales

will increase.

 Statistics divulge that 37% respondents are “Agree”,

22% are “Strongly Agree” and 27% are “Neither

Agree or Disagree” to the above statement. However,

it shows that people particular brand purchasing

attitude can be changed by offering price discount.

 Many people will buy the product that gives standard

quality with high price.

C. Analysis for (Part C)

 If AirAsia advertise more on Internet or social media

it will be beneficial for the company.

 People would recommend AirAsia Airlines to their

friends and relatives because of its low/cheap tickets

and promotional activities.

 55% of the total respondent replied “Agree” to the

statement that they feel positive towards the AirAsia

advertisement and 12% are “Strongly Agree”.

Moreover, 29% respondents are “Neither Agree or

Disagree” to the above statement. This means that

mainstream of respondents feel positive.

 Promotions has an impact on Air Asia’s consumers

purchase decision and their satisfaction.

 Sales promotion is an effective way for AirAsia to

sale tickets and it appeals to travelers to buy AirAsia

tickets.

 Mainstream of respondents believe that Online

Service Quality impacts their purchase decision in

booking a ticket.

 Low fare can easily influence AirAsia consumers

travel frequency.

 Results exposes that most of the people enjoy with

the procedures and they don’t find it complicated

when they book Air Asia ticket online. This proves

online booking and other services that AirAsia

provides online are convenient for their target

audience.

 Most of the respondents or AirAsia consumers would

prefer to repurchase products and services from

AirAsia.

 In fact, AirAsia e-ticketing tool is greatly succeeded.

 AirAsia consumers online ticket purchasing not only

satisfies them but also meets their expectation and

above that online ticket purchasing of AirAsia

Airlines is convenient way for their consumers.

 Overall impact of three elements (advertising,

pricing and online accessible) can be considered very

well and in the best interest of Air Asia Airlines.

VI. SUMMARY OF THE CHAPTER

This study was design to investigate the relationship

between the factors such as Advertising, Pricing and online

accessible that attract the consumers to buy the online

tickets of AirAsia Airlines. In this chapter objectives are

measured by using instruments (Questionnaire) which

consist of three parts (A, B, C). Questionnaire using five

point Likert Strongly Agree/Strongly Disagree scale

respectively. Moreover, in this chapter data collected from

total 49 APU students and analyzed using histogram and bar

charts, this chapter described the sample that was studied.

VII. CONCLUSION

This research provides the thorough understanding of

how AirAsia applies factors such as “Advertising and

elements in advertising like splendid Pricing strategies” to

impact our purchase decisions. AirAsia Airlines typically

choose internet as medium to advertise their services and

latest offers/promotions, therefore, in chapter 5 and 6

different type of posters and animated ads were created to

examine the effects of advertising on consumer purchasing

behavior. Besides, in chapter 5, “10” posters were created

and in chapter 6,”10” animated ads were produced to

achieve the deliverables of the final year project.

In general, the findings showed that 61% of the

respondents are believe that advertising on social media is

persuasive and influence them to buy AirAsia tickets.

Similarly, 57% respondents responded to pricing actually

persuade them to made final purchase decision. At the end,

results reveal that in total 55% consider that overall impact

of advertising, pricing and online accessible that attracts the

consumer to buy the ticket of Air Asia is quite strong and

thriving.

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Ahmed Shehroze Yasin

was majored in

physics,

chemistry, biology, mathematics

from Punjab Board

of Secondary Education, Bahawalpur, Pakistan,

August 2008

His diploma was in business with information

technology, majored in

managing business, business

environment, multimedia, business economics

from

Asia Pacific University, Kuala Lumpur, Malaysia, in Nov.

2012.

His BSc. (Hons) was in media informatics, majored in

advance

multimedia, multimedia films and game effects, advertising, public

relations, strategic planning

from Asia Pacific University of Technology

and Innovation, Kuala Lumpur, Malaysia, in August 2014.

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Journal of Innovation, Management and Technology, Vol. 5, No. 5, October 2014

387

[14] W. Kheong, “Factors influencing the intention to use the 3-ticketing

system for international flights among malaysian air travelers’ Wong

Chee,” Business Administration, pp. 2-24, 2008.

[15] R. M. Grant, “Airasia: The worlds lowest cost airline,” in R. M.

Grant, ed., Contemporary Strategy Analysis, 7th ed., Chichester, UK:

John Wiley & Sons Ltd, 2010, pp. 625-635.

[16] K. B. Meranun and A. Omar, The Marketing Strategy of Air Asia

Tourism, 3

ed., UK Essays, 2013, ch. 5, pp. 17-69.

[17] Y. Yashodha, “AirAsia berhad: Strategic analysis of a leading low

cost carrier in the Asian region,” Management Arts, vol. 51 pp. 1-8,

2012.