MARKETING AND DISTRIBUTION STRATEGY

CSA Network and Cooperation with Other Airlines

One of the main objectives of the marketing and distribution strategy for 1997, was to optimise the CSA timetable, taking into consideration the needs of the targeted market segment, while maximising the effective use of the fleet disposable to CSA.

When compiling the 1997 timetable, the construction of several connecting waves at Prague-Ruzyni Airport was successfully used. This approach enables strengthening of the role of Prague Airport as a transfer hub for transport among third countries. This role may now fully develop after the opening of a new airport terminal in June 1997.

Cooperation with other airline companies was essential in order for CSA to offer the following: a more advantageous timetable, more frequent flights and improved seating capacity. This in turn increased the financial results on specific flights, ultimately meaning that inter-airline cooperation was the fundamental marketing tool at play when optimising CSA's timetable and network.

The partnership with Continental Airlines, the USA airline, is the foundation stone of CSA's flights to the United States of America and is one of the most important cooperative agreements CSA has entered into with another airline.

In 1997, CSA passengers benefited from the extension of the Continental Airlines code-share operation to a further seven points within the USA: Buffalo, Columbus, Kansas City, New Orleans, Phoenix, Rochester and Seattle. Thus, the total number of destinations to the North American sub-continent has climbed to twenty-six, including that is, the inaugural route, Prague to New York. This "alliance" with Continental Airlines, furthermore, enables CSA passengers to arrive at all twenty-six North American cities within a single day, thanks to an advantageous timetable and through check-in.

In 1997, a record growth in the number of passengers travelling between Prague and the USA was achieved. Furthermore, a continuous increase in the number of passengers travelling in business class was also attributed to this "alliance" cooperation. A jointly formulated marketing plan continues to be carried out, whereby the coordination of sales policy, timetables and the improvement of check-in procedures, especially for transfer passengers, are prevalent.

The capacity on CSA between Prague and important European cities has also been increased, due foremost to the various cooperation agreements initiated by CSA and various strategic European carriers.

Since the summer of 1997, closer cooperation with the Italian airline company Alitalia has been in operation. Based on the new agreement, a cross exchange of seats on CSA and Alitalia flights between Prague to Rome and Milan is in place. Simultaneously, and in accordance with the new agreement, the timetables of both companies were aligned to meet passenger demand and to optimise on revenues. This form of cooperation dramatically contributed to the increase in the number of passengers between the Czech Republic and Italy and thus led to the improvement of financial results of all CSA routes to Italy.

CSA also adopted a new form of cooperation with Air France. Beginning in May 1997, both companies could purchase fixed blocks of seats on their partner's flights operating between Prague and Paris. The CSA timetable was also aligned on the Prague - Paris route, offering CSA passengers 27 flights weekly in each direction.

A similar form of cooperation was also agreed with the Polish carrier LOT and the Hungarian carrier MalÚv. Cooperation agreements were re-negotiated with KLM, Swissair and Austrian Airlines . These initiatives enabled CSA to offer an increased capacity to key European destinations, whilst protecting market share. For example, CSA could offer 27 flights a week to Zurich and 21 flights a week to Amsterdam and 39 flights a week to Vienna.

In April, CSA also introduced a regular operation from Prague to Munich in cooperation with Lufthansa. The CSA timetable was organised for six flights a week in each direction and this route immediately recorded very good results.

Additionally, in 1997 Czech Airlines concluded cooperation agreements with Air Ostrava and Tatra Air, regional and domestic carriers, which operate schedule flights on short routes between Prague to Germany and Slovakia.