Air NZ Increases Dominance of Online Aviation

Air NZ Increases Dominance of Online Aviation Space As Virgin Blue Prepares to Enter New Zealand Domestic Market

Auckland 30 August, 2007 - Hitwise, the leading online competitive intelligence service today reveals that Air New Zealand has increased its market share within the online travel industry following its “Grab a Seat” campaign. Visits to the Air New Zealand website increased by 25% in the All Categories industry, comparing weeks ending 14 July and 18 August. This coincided with a spike in consumer searches for ‘grab a seat’, week ending 21 July 2007.

Competition in the online travel industry looks set to intensify with the announcement of Virgin Blue’s intention to enter the New Zealand domestic aviation industry. Given that Air New Zealand now commands 62.14% of all Aviation - Commercial Airlines website visits, week ending 18 August 2007, up from 58.94% 3 months ago, week ending 19 May 2007, Virgin Blue will have its work cut out in capturing market share. Qantas was the nearest competitor to Air New Zealand, accounting for 8.63% share.

In the Australian market, the online Commercial Airlines industry is highly competitive with a more even spread in market share amongst the leading players. Qantas and Virgin Blue lead the industry, accounting for 28.64% and 26.81% share respectively for the week ending 18 August 2007. Jetstar and Tiger Airways also held significant portions accounting for 17.82% and 3.99% share respectively.

Hitwise search data indicates that trans-Tasman destinations dominate searches by New Zealand Internet users. The top search variations on ‘flights to’ included, ‘cheap flights to australia’ and ‘cheap flights to sydney’, out of a total of 8,041 terms for the 24 weeks ending 18 August 2007. Popular domestic searches included, ‘flights to wellington’, ‘flights to queenstown’ and ‘flights to christchurch’.

The online Airline industry is highly dependent on website traffic from Search Engines, which accounted for 28.05% of upstream traffic for the week ending 18 August 2007. Traffic between airline websites is common, with cross-industry downstream referrals accounting for 22%. The propensity for consumers to shop across airline websites will be in Virgin Blue’s favour as it enters the New Zealand domestic market.

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