Korean Air posted its largest operating profit in five years in 2016, amounting to 1.12 trillion won on sales revenue of 11.731 trillion won, the air carrier said on Feb. 9. Sales revenue increased 1.6 percent over the preceding year, while operating profit jumped 26.9 percent YoY.
Low fuel prices helped the favorable performance record. Also, the Korean currency’s high exchange rate against the U.S. dollar cut foreign debts expressed in U.S. dollars. The largest airline in Korea recorded a loss in net profit amounting to 556.8 billion won last year for the 4th year in a row since 2013. The loss grew because it included financial support provided to Hanjin Shipping, one its affiliates, that went bankrupt, amounting to 825.1 billion won. The airline’s annual net loss without the 4th quarter came to 641.9 billion won with the debt ratio rising rapidly.
The air carrier has been after ways to offset changes in the aviation environment that could hamper its operation.
Korean Air was looking to increase its campaign reach in the region in conjunction with newly launched local language websites for Indonesia, Thailand and Vietnam. Simultaneously, Korean Air was seeking to achieve performance benchmarks.
Several strategies were identified and implemented to achieve the KPI, including household extension, “look alike modeling,” and retargeting. Additionally, dynamic creatives and local language creatives in Bahasa Indonesia, Thai and Vietnamese were created to promote newly launched local language sites.
By leveraging Knorex XPO, a proprietary full-stack advertising platform with several key advertising technology components, Knorex worked closely with Korean Air to execute the campaign into global ad exchanges to programmatically target the appropriate channels and audience segments.
Using household extension, Knorex not just targets individuals looking to buy air tickets for leisure, but also the influencers within the household. This carefully crafted strategy ensured that relevant and highly engaging ads were shown to the stakeholders in making decision.
With a proprietary optimization algorithm, exploiting the amalgamation of multi-party data to identify key segments, and integrated advertising on display, Facebook, Instagram and LinkedIn, Knorex delivered better than expected results.
Target KPIs were surpassed by a respectable margin.
The total number of impressions delivered exceeds 10 million with click-through rate (CTR) reaching 0.2 percent, while for the ultimate metric, i.e. the return on investment exceeding 90x for certain countries.
Korean Air is the largest airline–and flag carrier–of South Korea based on fleet size, international destinations and international flights. Korean Air’s international passenger division and related subsidiary cargo division together serve 127 cities in 44 countries, while its domestic division serves 12 destinations. It is among the top 20 airlines in the world in terms of passengers carried and is also the top-ranked international cargo airline.
Korean Air is the parent company of Jin Air and is a founding member of the SkyTeam airline alliance. The alliance has since become the second largest in the world, behind Star Alliance.
It was voted Asia’s best airline by Business Traveler readers in 2012.