The Airline That Best Knows Greece
Aegean Airlines Excels Despite A Difficult Greek Economy
With the backdrop of Greece and its national and international economic shortcomings, Aegean Airlines has established an exemplary standard of excellence. The airline unquestionably stands as a success amid turmoil in Greek economics, with Aegean emphasizing classic culture and tradition while carving out superior ratings and operating-margin performance.
Standing tall among global businesses, especially highly competitive airline businesses of every imaginable description, is a noteworthy challenge, but it creates a day-to-day climate of technology and rapid-fire change in which Aegean Airlines has learned to thrive.
For a carrier that only came into existence as a charter air service called Aegean Aviation in 1987 (and began scheduled operations in 1999), Aegean Airlines has experienced a lot as an organization, achieved high standards of popularity and performance, and become a fixture of Greek financial and cultural influence, even in the midst of national economic stress and uncertainty.
Moreover, Aegean seems determined to exhibit the best of everything Greece has to offer, from rich philosophic and architectural history to delicious Greek cuisine and cheerful attitude (the airline consciously leverages food to further promote a distinctive Greek feel), as well as the uniquely Greek-inspired and -designed fashion of its flight attendants and pilots.
In short, Aegean is by every indication truly living up to its corporate mantra as “the airline that best knows Greece” each and every day. Furthermore, it is seizing the advantage of being the carrier (especially since the 2013 acquisition by Aegean of its former Greek rival Olympic Air) that in passengers’ minds is most closely associated with Greece.
The very name of the airline, “Aegean,” brings to mind the Aegean Sea of Greek myth and legend, but that physical body of water is a substantially real portion of the greater northern Mediterranean Sea.
Scattered across the Aegean Sea are the ever-enchanting Greek islands, beckoning actual visitors and daydreamers alike to imagine themselves living there, in the quintessential island archipelago (although the meaning of that original Greek term “archipelago” has now been broadened to define any extensive island chain worldwide).
Daydreamers aside, being the airline that people primarily think of when they think of Greece, and the country’s historical sites and ancient artifacts, is a critical component in the greater branding strategy of Aegean Airlines.
A Recognized Brand
Brand awareness has been and will continue to be a marketing staple for Aegean.
Relating further to well-known, recognizable brands, Aegean joined with a number of other high-profile airlines in 2010 when it became part of Star Alliance, which effectively extended the Aegean brand by proxy.
Membership in the alliance has become a significant point of recognition in Aegean’s public posture, as well as serving mightily to help broaden the airline’s scope in a global perspective.
Realities Of Geography
Greece is a relatively small country, and Aegean Airlines’ only realistic route to current and future domestic growth is through flight frequency, but international opportunities are more plentiful.
Low-cost carriers (LCCs) such as Ryanair have entered the Greek market, and Aegean continues to deal with heavy competition not only from LCCs but also from numerous full-service airlines from outside Star Alliance.
Nonetheless, Aegean particularly sees room to grow and attract more customers in a five-hour-and-30-minute flying-time range.
With this approach, Aegean doesn’t need bigger aircraft, so that helps considerably in holding costs down. It doesn’t want to stray from its model, or to get distracted by something it doesn’t really know, which would encompass the longer-haul flights. Rather, Aegean wants to focus on what it knows best (for example, it is not looking to initiate trans-Atlantic service, but it can expand to serve more destinations in Europe, Asia and Africa), and the company sees room to grow in international markets. This year, the company is expected to operate 149 destinations in 45 countries.
In fact, the carrier’s expansion on the international front, into more international markets, has been Aegean’s primary growth factor. And the airline feels it can achieve continued growth because of its consistently demonstrated capabilities in delivering a reliable product at an affordable price.
In recent years, Aegean Airlines has posted favorable financial results, with 2014 revenue at an all-time record of 911.8 million euros (US$1 billion), which ranked Aegean solidly among the world’s top 10 airlines in operating margin as calculated and published in Airline Weekly.
Aegean’s financial results have been good enough that it has been able to establish a strong fundamental structure, even including impressive levels of profitability, despite a very negative Greek economic environment overall.
Operating a total of 61 aircraft this summer, up from 58 in the summer of 2015, after Aegean’s recent investment in new additional Airbus A320ceo aircraft, with an average age of about six years, the company has a relatively young and efficient fleet. The airline carried 11.6 million passengers in 2015. In a repetitive mode of success, Aegean Airlines has been named best regional airline in Europe six times by Skytrax during the last seven years.
In fact, Aegean is the largest Greek airline by total number of passengers carried, number of destinations served and fleet size, and it operates in a low-cost-carrier-competitive market, also traditionally having state-owned airlines as primary competition. So battling low-cost carriers and full-service airlines at the same time is part of Aegean’s DNA.
As such, the airline provides a premium product and high-quality service at a reasonable price to remain competitive.
Nevertheless, as the Greek economic crisis has grown, Aegean has restructured essentially through investment in people, technology and training. Aegean believes in a lean but competent operation, with about 90 percent of its employees on the frontline and only 10 percent considered “non-customer-facing.” These ratios may or may not differ appreciably from the rest of the industry, but Aegean sees them as an effective way of getting the best production from a lean, strong workforce.
In recent years, Aegean Airlines has been recognized for its level of service, business savvy and overall success. For example, in the last seven years, the airline has been named Best Regional Airline In Europe six times by Skytrax World Airline Awards. And in 2014, Airline Weekly ranked it among the world’s top 10 airlines in operating margin.
Innovators At Heart
Aegean’s leadership is proud of its people, selected based on their skills as well as their mindset and willingness to develop themselves within the Aegean company culture. The airline wants all employees to feel good when they come to work, to really love working there and to take the greatest pride in being Aegean employees.
The “people” aspect never wavers, and Aegean management feels that’s what keeps customer-service levels high and customers coming back.
Overall, Aegean’s employees consider themselves to be technology-savvy, and perhaps even among the most knowledgeable about and capable of taking advantage of technological advances in the global airline industry. Being an “innovation-driven” company, Aegean’s personnel want to try new things, and they’re very skilled and experienced in implementing innovative technology.
The carrier prides itself on a philosophy of innovation. In fact, one of its often-repeated self-descriptive phrases refers to Aegean’s “quality and efficiency to grow with people who are fluent in technology,” a nice summation, but especially relevant if Aegean’s workforce takes it to heart and demonstrates its technology prowess in everyday operations and customer relations.
Aegean believes in continuous investment in training, skills development, technology and a corporate vision of belief in the airline’s capabilities to serve its customers with competence and enthusiasm. The company views its investments in technology and people as vital to performance. Among corporate objectives is elimination of “junk work,” so jobs become easier and productivity increases.
For Aegean, innovation is a major differentiator, and the organization’s goal is to always act with agility, quick decision-making and the most effective technology. Therefore, the airline’s IT partners play an important role in supporting innovation with flexible and open technology.
New, game-changing revenue-management functionality, for example, would enable Aegean to take a proactive approach against its competition (low-cost as well as full-service carriers). As such, the airline has been instrumental in assisting in the design of Sabre AirVision Revenue Optimizer, Sabre’s next-generation revenue-management solution. Because it thrives on innovation, the airline doesn’t want to sit back and wait for the next wave of technology to arrive. Rather, it wants to be part of the industry’s ground-breaking revelations.
On another technology front, facing a stiff field of competitors, Aegean has honed its competitive edge by investing substantially on the customer frontend (website and mobile) to do everything it can to provide the best experience for its guests.
“We are pleased to have substantially shortened the processes our passengers experience on our booking tools, website and mobile, and will keep investing to further develop our applications” said Aegean Airlines Chief Executive Officer Dimitris Gerogiannis. “Easy-to-manage processes with fully integrated ancillary booking and service flows is what we will invest in.”
Going forward, Aegean Airlines’ biggest challenge by far revolves around the future of Greece and the euro currency.
Today, with the ongoing Greek economic crisis, Aegean is sticking with its lean workforce parameters, and actually experiencing growth at some domestic airports based on incoming leisure travelers who want to personally experience life on the Aegean Sea.
Despite the country’s economic doldrums, Aegean Airlines continues to be a positive entity for Greece. The carrier is a leader in culture and finance, and is one of the high points to which Greek economic analysts can point with pride.
And as a top innovator, Aegean sets the pace for much of the rest of the industry. The airline aims to continue to achieve high standards, both in technology and the people who understand how to apply it for significant growth.