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October 27, 2013

Cooperation Between Competitors

I was reviewing the Seminar 2 topic: why do business competitors cooperate with each other, and I thought of an example that may best explain this phenomenon. I am a member of ‘sky blue’ club. So whenever I fly I collect points/miles from my travelling and I can use it for my next travel. There are many airlines in this club, including Chinese Southern Airline, KLM and other companies. As I used to study in Edinburgh, I always flew with KLM. And for the miles I collected, I can use it when booking a KLM flight or any other company’s flight, such as China Southern Airline flight. It gives me great deals on travelling. So for one KLM flight from HK to Edinburgh, I can exchange one domestic flight ticket with China Southern Airline. Travellers choose sky blue, knowing that they get benefits from all these airlines. Yet these benefit as well as customer loyalty would help travellers to stick with the airline companies within this ‘Sky blue’ club, which is then becoming a benefit for all these member airlines as well. This creates a win win situation. And travellers may choose whichever companies according to their own demands and situation. As if one is flying within China, he knows that he can choose Southern airline, while if he is travelling abroad, there are other airlines he can go with.

These airlines are competitors, yet in this case, under 'Sky blue', they are cooperating with each other.

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