Available online at www.iseec2018.kbu.ac.th Proceeding Social Science Area: Aviation Industry, May 2018, page 202-210 www.iseec2018.kbu.ac.th The 9th IInternatiionall Sciience,, Sociial Sciience,, Engiineeriing and Energy Conference''s e-Proceediing The Influence of Marketing Innovation Strategies and Marketing Environments towards Marketing Performance for Airline Business in Thailand for ASEAN Economic Community (AEC) Wethaka Washrakunathorn1, Narongdech Pasputhijiam2, Supachoke Suthichoti3 and Prachon Thanasumitr4 1,3,4 Instructor of Airline Business at Aviation Personnel Development Institute, [email protected], [email protected], [email protected] 2Assistant Director of Airline Business at Aviation Personnel Development Institute, [email protected] Airline Business at Aviation Personnel Development Institute, Kasem Bundit University, 60 Romklao Road, Minburi, Bangkok 10510 ABSTRACT The objectives of this study were; (1) to examine implementation levels of marketing innovation strategy and marketing environments influencing on marketing performance of airline business in Thailand (2) to examine marketing performance levels from implementing with marketing innovation strategies and marketing environment (3) to examine the influence of marketing innovation strategies towards marketing performance (4) to examine the influence of marketing environment towards marketing performance. This was a qualitative research. The samples were 4 officers 2 from sales department and 2 from marketing department of 9 Thai scheduled airlines holding certified AOC Since late 2017 using purposive sampling. The results of these analyses showed that (1) implementation level of marketing environment was higher than marketing innovation strategies; (2) competitive environment was the highest influential in profitability in marketing performance; (3) marketing innovation strategies were not directly influential in marketing performance; and (4) external marketing environment was directly influential in marketing performance. This research will bring advantages to airline business in Thailand in order to create marketing strategies and policies for ASEAN Free Trade Area (AFTA) agreement in ASEAN Economic Community (AEC). Keywords: Marketing Innovation Strategy, Marketing Environment, Marketing Performance 203 Wethaka Washrakunathorn et al. / Proceeding – Social Science (2018), page 202-210 1. Introduction Aviation is a service business that is very important to tourism development, which affects the economy of the country. It is evident from the National Economic and Social Development Plan No. 10 that the service sector will be transformed into a major source of income for the country and that the competitiveness of the service sector will be improved. Expansion of the service market to cover the region. With the development of Thainess to connect with more countries to support the entry into ASEAN (The Office of National Economic and Social Development Board (NESDB) 2010–2011 cited in Kittinant Phitsuwan, 2017) and the income from tourism received by foreign tourists visiting Thailand in 2015 deducted by the expenditure of Thai tourists to travel abroad. As a result, Thailand's tourism service surplus in the third quarter surged to 284,225 million baht, while the surplus in the second and the first quarter was 244,684 and 309,726 million baht, respectively. Compared to the total service balance of the country, according to the Bank of Thailand's report for fiscal year 2015, there were 59,318, 30,531.09 and 127,703 million baht, respectively. The tourism service balance was higher than the overall service balance of 4.79, 8.01 and 2.43 times in Q3, Q2 and Q1 respectively. Reflecting that throughout the three quarters the tourism service balance is very important to the country's balance of payments surplus. The foreign tourists all over the world come to Thailand. Nowadays, it is important to use air transportation services. However, after the Thai airline business failed to pass the Universal Safety Oversight Audit Program (USOAP). Impact on the operation of the Thai airline business to be disrupted and slow down. At the same time, other foreign airlines have experienced rapid business expansion especially low-cost airlines in Southeast Asia. The competition in the aviation business increased. As a result of existing competitors in the market and the new entry competitors directly affect the marketing performance of the airline business in Thailand inevitably. The main research questions of this study are how the three dimensions of marketing environment which are technological environment, competitive environment and market environment competes through marketing performance in order to increase the marketing performance of Thai registered airlines and operate in Thailand. 204 Wethaka Washrakunathorn et al. / Proceeding – Social Science (2018), page 202-210 2. Literature Review and Hypothesis The research model of this study is illustrated in Figure 1, showing the relationships among marketing innovation strategy (Product innovation, process innovation and Business innovation), marketing environment (technological environment, competitive environment and market environment) and marketing performance (market share, profitability, sales growth, customer number, customer satisfaction and customer loyalty). Marketing Innovation Strategy Marketing Performance 1. Product innovation 1. Market share 2. Process innovation 2. Profitability 3. Business innovation 3. Sales growth 4. Customer number Marketing Environment 5. Customer satisfaction 1. Technological environment 6. Customer loyalty 2. Competitive environment 3. Market environment Figure 1: Conceptual Framework 2.1 Marketing Innovation Strategy Marketing innovation strategy is defined that significant changes in innovation/knowledge is a stem from the revelation of something new. Incremental innovations, on the other hand, are major advances to an established technology/knowledge (Garcia&Calantone, 2002). The logic of marketing innovation emphasizes sales growth by shifting consumer demand from elastic to more inelastic market segments through the delivery of better value (actual or perceived) to the consumers (Bennett&Cooper,1979,1981; Hurley&Hult,1998), Thus, such as marketing innovation strategy is learning orientation that refers to learning something new and has changed over time, both within and outside the organization by systematic pattern, such as knowledge sharing between departments and the application of modern technology, under providing the supporting with the implementation of airlines business. It led to established knowledge newness. While, Moreira and Silva, 2012 defined marketing innovation is as an advancement is as a capacity of airlines to inventive for creating new product and administrations picking up to the business sector, for example, 205 Wethaka Washrakunathorn et al. / Proceeding – Social Science (2018), page 202-210 upgrade bundling, new media for product advancement, new strategies for deals channels, and new routines for valuing pricing goods or services, which are important for many organizations leading to marketing sustainability. And Naidoo, 2010 revealed that marketing innovation is defined as the upgrades in product design, estimating, situation, advancement, and the chance of survival. With an essential target of advancement being the improvement of new or adjusted products/processes aimed at improving organizational performance and with superior performance inherently dependent on understanding and satisfying customer needs better than one's competitors, market orientation and innovation are intrinsically linked constructs (Augusto & Coelho, 2009; Hauser, Tellis, & Griffin, 2006). There are three dimensions of marketing innovation strategy in airline business: Product innovation are products that have been commercially manufactured have been improved or are new to the market such as fleets of aircraft (A380, A350, A320-Neo, B787), In-flight services menu. Process innovation is a change in the way or production of goods or services in a different way from the original such as Self Automate Check in system, Reservation & Ticketing by social network. Business innovation are new ideas that can be sold or making new ideas commercially valuable in order that the business will be successful and sustainable such as Thai Air Asia’s Self Automate Check in system, New Gen Airways’ the Spilt Scimitar Winglets (SSW). Hypothesis 1: Marketing innovation strategies influence marketing performance. 2.2 Marketing Environment The Marketing Environment includes the internal factors (employees, customers, shareholders, retailers & distributors, etc.) and the external factors (political, legal, social, technological, economic) that surround the current airline business and influence its marketing operations. Some of these factors are controllable while some are uncontrollable and require business operations to change accordingly. Airlines must be well aware of its marketing environment in which it is operating to overcome the negative impact the environment factors are imposing on airlines’ marketing activities. This research was put emphasis on how does the changing marketing environment (technology, competition, market) impact on the airline's marketing performance? 206 Wethaka Washrakunathorn et al. / Proceeding – Social Science (2018), page 202-210 Technological environment: the Smartphone has better technology and cheaper. As a result, those who book seats