Air New Zealand has cachet with Chinese flyers

Chinese celebrity Nicky Wu makes friends with Pete the kiwi.

Scott Carr took up the role of Air New Zealand's regional general manager Asia in April 2016.

Shanghai-based Carr has global experience including Japan, New Zealand, Australia, United States, the United Kingdom and Europe. But he says China is the most competitive market he has ever worked in.

"The aviation market in China has seen enormous growth in recent years, particularly in the past 18-24 months. We're seeing quite a number of new carriers entering second-tier cities, second-tier carriers, that kind of thing," he says.

"Not everyone is focused on short- to medium-term EBIT. Some are in it with a long-term strategy, and others are just opportunistic cash-flow searching. It's a really interesting, challenging environment."

Carr says the size of the market in China can seduce companies into losing sight of brand value and quality.

But he adds that New Zealand carries a cachet with Chinese consumers, which has helped Air New Zealand position itself into a higher yielding market segment.

"From an Air New Zealand perspective, and indeed from a New Zealand country perspective, I think we've always got to maintain our focus on the value for money proposition rather than the pricing proposition," he says.

"Air New Zealand is the only airline that can say: your holiday starts the moment you get on board."

Handing out lollies is popular everywhere.

Marketing and social media

To create a strong brand impression in the minds of Chinese consumers and drive awareness and preference for the airline, Air New Zealand uses highly effective brand and social media marketing campaigns.

The airline now has nearly 260,000 followers on its various social media channels in China including WeChat and Weibo.

In November Air New Zealand launched its "A Better Way to Fly" global brand campaign in China. The video, featuring Pete the Kiwi, has achieved more than 14 million views in China and has helped highlight some of the unique product and personality differences Air New Zealand offers its customers.

Last month, Air New Zealand released it's "World's Coolest Safety Video" set in Antarctica, which has already achieved nearly 8 million views.

"The digital online environment and the way that people consume media in China has helped us have a huge uptake in terms of video views and in terms of generating a positive brand impression," says Cara.

Cargo

Air New Zealand has seen double digit growth in cargo from the New Zealand and China ends of the market.

Cargo into China from New Zealand is typically fresh seafood, dairy, produce and meat.

Fresh seafood and stonefruit have grown strongly in the past year, and some fresh fish shipments have increased 87 per cent on Air New Zealand's services.

"Chinese consumers put a premium on freshness and safety.

"New Zealand's reputation and quality of products means that to the Chinese consumer our export products are in high demand and maintain a premium price in the market," says Carr.

"As new products are signed off and listed in the FTA we see strong growth for that product. Demand for fresh milk is continually growing."

Out of China, cargo tends to be high-end electronics, with significant bumps in demand during new phone or electronics launches.

"Cargo tends to be a bit of a lead indicator for us at times, so we look at the growth in that side of our business as being a good indicator for our future in the market," says Cara.

Chinese tourism - visitor arrivals

● Year end February 2018 at 436,000 and growth of 8 per cent for the year
● February month numbers more than doubled last year, as a result of Chinese New Year timing, to nearly 69,000, the largest month on record.
● Total for January-February period (i.e. covering the Chinese New Year period for both years) was up more than 18,000 visitors (21 per cent)
● Provisional numbers for March suggest continuing growth in the high single figures.

Air New Zealand

● First carrier to fly non-stop between mainland China and New Zealand with launch of Shanghai services in 2006 (12 years of operation)
● Daily 302-seater 787-900 operates all year on the Shanghai-Auckland route
● Additional three-weekly 787-900 service (10 times a week in total) over the key 7-8 week Chinese New Year period.
● 120 staff based in Shanghai including about 80 cabin crew