...2.2 Business process and operation…………………..………………….9 2.3 Low cost carrier (lcc) business model……………….………………11 2.4.1 Business model……………………………………………...11 2.4 Competitive Advantages …………………………..…………………..12 2.5 Historical Performance………………………………..……………….13 2.0 ANALYTICAL SWOT ANALYSIS……………………………….……………..18 3.0 PRODUCT ANALYSIS…………………………………………….……………21 4.6 The product Life Cycle (PLC)………………………………....………21 4.0 STRATEGIS AND TACTICS………………………………………..………….24 5.0 SEGMENTATION, TARGETING AND POSITIONING ANALYSIS 6.7 Market Segmentation………………………………………..………….26 6.8 Target Market Profile……………………………………………………30 6.9 Positioning………………………………………………………….…….32 6.0 MARKETING STRATEGIES AND EVALUATION OF MARKET PROGRAM ELEMENTS………………………………………………………………………..33 Refferences…………………………………………………………………………………………………………….36 1.0 INTRODUCTION AND HISTORY a. Introduction of the product Name of the company: Air Asia Berhad ABOUT THE PRODUCT Air Asia is a low cost airline based in Kuala Lumpur, Malaysia. It operates scheduled domestic and international flights and is Asia’s largest low fare, no frills airlines. Air Asia pioneered low cost travelling in Asia. It is also the first airline in the region to implement fully ticketless travel and unassigned seats. Its main base is the Low Cost Carrier Terminal (LCCT) at Kuala Lumpur International Airport (KLIA). Its affiliate airlines Thai Air Asia and Indonesia Air Asia fly from Suvarnabhumi Airport...
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...The Low Fares Airline” Ryanair – The Low Fare Airline Being founded in 1985 by an Irish businessman, Tony Ryan, Ryanair today is Europe’s first and largest low fares airline (Thomson and Bade-Fuller, 2010). Since 1991 with Michael O’Leary taking a position of CEO of the company, Ryanair in 2008 had served about 50.9 million passengers in around over 25 European countries with a total number of 163 Boeing 737-800 planes (ibid). The low-cost model airline is pursuing seem to be successful, resulted in continuously increasing margin rate and overwhelming competition with other major airlines, like easyJet and Lufthansa (ibid). The predominance of Ryanair as Europe’s largest low cost carrier is a consequence of the following cost advantage sources. Homogenous fleet, frequent short-haul flights, high seating density and planes filled to capacity due to cheap early bird tickets allow Ryanair to benefit from economies of scale (Thomson and Bade-Fuller, 2010). Standardisation and simplification of jobs results in economies of learning and residual efficiency. Process design, that includes 96% card only online bookings, fast boarding, short haul flights, use of homogenous fleet with simplified aircraft design, low number of staff, use of secondary airports and departures before 9pm leads to efficient service delivery (ibid). Ryanair product design is aimed at delivering customers no-frills service while keeping the company costs at the minimum. Input costs are kept low by using...
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...Business and Law International Business Strategy Analysis Group Assignment (35%) INB70012 Global Business Strategy Semester 1, 2015 Strategy Analysis of AirAsia Convenor : Dr Aron Perenyi & Lecturer Students : Natalia Knets Emma Dalton Gautham Raju Markus Arian Shakoor (1704583) * Executive Summary * Content page Executive Summary II Content III Figures IV 1 Introduction 1 2 Mission, Vision and Core Values 1 3 External Environment Analysis 2 4 Internal Environment Analysis 4 5 Current Strategy Analysis 7 5.1 Corporate and International Strategy 7 5.2 Business Strategy 9 6 Strategy Fit 9 6.1 Financial Performance Analysis 9 6.2 SWOT Analysis 11 7 Strategy Recommendations 14 References 15 * Figures page Figure 1: Structure of AirAsia 8 Introduction AirAsia is a Malaysian low-cost carrier (LCC) and has been established in 1994 by DRB-Hicom. In 2001 Tony Fernandes took over the company and remains the CEO of the AirAsia Group. Fernandes turned the company from a small airline with two aircrafts operating to one destination with 250 staff (AirAsia 2015a) into the number one LCC operating in Asia. Today it operates on 132 routes, connecting 65 destinations in 18 countries with over 8,000 staff (AirAsia 2015b). The group services almost 12 million passengers per year with 171 aircrafts (AirAsia 2015c). This report provides a comprehensive strategy analysis of Air Asia. First the mission, vision and core...
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...Fernandes, as the Chief Executive Officer of AirAsia, decided to pursue his dream to start an airline with the following vision: “To be an airline that flies long-hauls with low fares with a corporate culture that is flexible and functional”. AirAsia has achieved its title as “The World Lowest Cost Airline,” and was also one of the world’s most profitable airlines. This report provides an analysis and evaluation of internal and external of the company. Methods of analysis includes of internal and external assessment and financial analysis. SWOT analysis provided in this report will shows the strengths, weaknesses, opportunities and threats of AirAsia. At last of this report, we have provided the recommendations for AirAsia to increase their performance. 1.0 INTRODUCTION 2.1 Company Background Asia’s leading airline was established with the dream of making flying possible for everyone. Since 2001, Air Asia has swiftly broken travel norms around the globe and has risen to become the world’s best. Air Asia was named the World’s Best Low Cost Airlines in the annual World Airline Survey by Skytrax for five year consecutive years in 2009, 2010, 2011, 2012 and 2013 and has been ranked Top 5 among the most recognized and admired airlines in the Asia Pacific Top 1000 Brands 2008. With a route network that spans through to over 20 countries, Air Asia continues to pave the way for low-cost aviation through our innovative solutions, efficient processes and a passionate approach...
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...The Low-Fare Revolution in the Sky Introduction Southwest Airlines: Southwest Airlines was originally incorporated to serve three cities in Texas as Air Southwest on March 15, 1967, by Rollin King and Herb Kelleher. It is an American low-cost airline based in Dallas, Texas, with its largest focus city at Las Vegas' McCarran International Airport. It is the largest airline in the United States by number of passengers carried domestically per year and (as of December 31, 2007) also the largest airline in the world by number of passengers carried. As of July 12, 2008, Southwest operates approximately 3,500 flights daily. Indian Aviation: Air Deccan, the first low cost airline of India was founded by Captain G. R. Gopinath and its first flight was launched on 23 August 2003 from Bangalore to Hubli. Air Deccan is a business unit of Deccan Aviation, India’s largest private helicopter charter company, which pioneered helicopter tourism in India. Air Deccan is India’s first low cost, no frill airline, which was launched on strength of simple dream that every Indian to fly atleast once in his/her lifetime. In October 2007, Air Deccan as a planned makeover after the acquisition was renamed as Deccan with is tagline "The Choice is Simple" based on its previous famous tag line 'Simplifly'. The old logo of hands has been replaced by the Kingfisher logo and the font of Kingfisher is also being used. Strategy for Success Southwest Airline: ...
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...Air Asia Berhad (Air Asia) is one of the leading low cost airlines in South East Asia which has expanded rapidly since 2001. AirAsia aims to establish itself as a leading low cost carrier in market by valuing its customers through cost advantages created by operational effectiveness and efficiency. The key of profitability for airlines is unit cost competitiveness because airlines know that it is difficult to increase their revenues in the current situation. The cost gap is the source of sustainable competitive advantage for Air Asia (low cost carriers). There are seven factors that determine firms unit costs compared to its competitors. They are also knows as cost drivers (Grant, 2014): Economics of scale: AirAsia does not use various types of aircraft, they use only limited types of aircraft in its fleet. They offer a single class which allows more seats per plane. As mentioned in the case, the Boeing 737 can be equipped 12 more seats per plane in the single class model compared to a traditional two class model. Although the company has replaced Boeing 737 with airbus 320, the new aircraft can also offers more seats with single class model. It creates the liquidity by moving pilots and cabin crews around to other same type’s aircraft and reducing training costs. Therefore, it generates economics of scale indirectly. Lean product: AirAsia’s products are basic, they do not provide hot meals, frequent flyer programmers, decent legroom, and a full complement of air-hostesses...
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...business philosophy is also help to avoid the any commercial mean that is harm to the organization and not so easy to let others company outside follow the pace of progress of AirAsia. AirAsia, as a company that no need any other introduction in ASEAN, where connecting people and places across 132 routes, 40 of which are offered by no other airline. AirAsia is one of the award winning and largest low fare airlines in the Asia expanding rapidly since 2001. AirAsia believes in the no-frills, hassle-free, low fare business concept and feels that keeping costs low requires high efficiency in every part of the business. Through the corporate philosophy of “Now Everyone Can Fly”, AirAsia has sparked a revolution in air travel with more and more people around the region choosing AirAsia as their preferred choice of transport. From an airline with two aircraft plying six routes in Malaysia in January 2002, AirAsia has soared in the last nine years to cover 65 destinations in 18 countries. Today, employing more than 8,000 staff and with a market capitalisation of just over RM7.06 billion (as at 31 December 2010), it is the only Truly ASEAN airline, serving the region’s 600 million population from 10 hubs in three countries - Kuala Lumpur, Kuching, Penang and Kota Kinabalu in Malaysia; Bangkok and...
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...Air Asia’s vision is to be the largest low cost airline in Asia and to serve the 3 billion people who are currently being underserved due to poor connectivity and high fares. Air Asia mission is to attain the lowest cost so that everyone can fly with Air Asia and to maintain the highest quality product, embracing technology to reduce cost and enhance service levels. Air Asia has a well-developed strategy that encompasses several core ideas that make their company both unique and profitable. Safety first – AirAsia partners with renowned maintenance crews and complies with world airline regulations. The company does not own a maintenance shop. Everything with maintenance and repair is outsourced to keep costs down. High aircraft utilization – having the fastest turnaround time in the region, they assure lower costs and higher productivity. AirAsia has the newest and most efficient fleet flying in the Asia region. The planes have a single seating class and hold more passengers than competitors. This allows for more revenue per flight. Low fare, no frills – keeps ticket prices cheap. Customers have the ability to customize for an extra fee. AirAsia focuses on price sensitive customers. Keeping lower prices is better for both the passenger and the airline. Streamline operations – simple is good. Using all the same planes saves on training pilots, contracting mechanics, and replacing parts. Lean distribution system – book flights online or on the phone. No travel agents. Passengers...
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...become the largest low-cost carrier in Asia. Today the airlines are operating in Malaysia, Thailand and Indonesia. With more than 6,000 talented, hardworking and committed employees and a market capitalization in excess of RM2billion, Air Asia has earned a reputation as a consistent performer no matter what the external environment. They have seen a future in which their success is not constrained by resources or opportunity. ORGANIZATIONAL ANALYSIS Company Background AirAsia is Malaysia’s second national airline was incorporated in 1993 as a full-service regional airline under DRB-Hicom. They started their operations on 1996. After starting their operations for few years, AirAsia failed to attract enough passengers to establish its own niche market. AirAsia was also facing problems such as the demise of Tan Sri Yahaya Ahmad and 1997-1998 Asian financial crisis. Due to 1997-1998 Asian financial crisis, AirAsia was heavily indebted. On 8 December 2001, music mogul Dato’ Seri Tony Fernandes decided to retire from music industry and purchased 99.25 per cent equity (51.68 million shares) in shares from DRB-Hicom via his company Tune Air Sdn. Bhd. with a token sum of one ringgit. Without looking back, Tony Fernandes transformed AirAsia as a low fare airline together with Conor McCarthy, the former Ryanair director of group operation. Known of its corporate tagline “Now everybody can fly”, AirAsia became the first successful low cost and ticket-less airline in the Southeast...
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...their position in the global market. AirAsia’s strategy is to become the largest low cost airline in Asia; however, their coverage stays within south east Asia, which with our consultation and data presented in this paper we can analyze and seek a path towards a much larger coverage and becoming the leading largest low cost airline in the world. For the sake of this paper, we will be focusing on AiAsia’s partnership with Emirates in the middle east region. Keywords—AirAsia; Strategy; Sustainable Growth; Low-cost Airline; Alliance; Global Market Analysis; Introduction AirAsia, a successful global company based in Malaysia has been transporting people in Asian for over 15 years. The company is however thinking about expanding their coverage through out all Asia; currently they are covering and more focusing in East and Southeast Asia. Analyzing AirAsia’s strategy will help us understand any trends that is either helping them or decreasing their growth, hence, with proper recommendations we would be able to help AirAsia achieve its goal: Becoming the largest low-cost carrier in Asia. Having that said, by looking the global market and the growth rate of AirAsia; the company will be able to become the world’s largest low-cost carrier instead of only Asia. This requires the company to make a few smart modifications in their strategy as well as partnering with some of other existing airlines to gather the market share they require in order to become the leading largest...
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...The Development and History of AIRASIA AIRASIA is one among the top International brand in the low cost Airline Industry. Airasia brand came into existence in 1993, it was a joint public-private sector enterprise, however in 2001 current CEO Mr. Tony Fernandes purchased it and It was under him the Airasia brand got global recognition and unimaginable growth which started right from 2002 and continues till date, AirAsia started moving up the ladder under Tony's leadership from 2002 onwards by launching new routes from its main hub the capital of Malaysia till then the national carrier of Malaysia ruled the sky in and around Malaysia. In 2007, Airasia announced the birth of Airasia X the long haul budget flights, the first AirAsia X flight was from Kuala lumpur International airport to Gold coast in Australia thus began the journey from south east Asia to capturing routes in major cities around the world. In 2007, Virgin Airline chief had 20% stake in AirAsia X and had announced code sharing between Virgin Blue and AirAsia in and around Australian subcontinent. Profile of AirAsia: AIRASIA, is Asia's largest and one among the top 10 international brand in the low cost segment having physical base in three countries; Malaysia, Thailand and Indonesia. AirAsia has four subsidiaries: AirAsia, Indonesia AirAsia, ThaiAirAsia and VeitJet Airasia. The company has a strength of around 3000 staffs and It flies to around 65 destinations worldwide using the 97 aircrafts and another...
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...AirAsia BERHAD MARKETING PLAN No. | CONTENTS | PAGE | 1.0 | Executive Summary | 1-2 | 2.0 | Introduction | 3 | | 2.1 Background and History of AirAsia | 3-4 | | 2.2 Vision Statement | 5 | | 2.3 Mission Statement | 5 | | 2.4 Objectives | 5 | 3.0 | Environmental Analysis | 6 | | 3.1 PESTEL Analysis | 6 | | 3.1.1 Political Factors | 7-8 | | 3.1.2 Economic Factors | 8-9 | | 3.1.3 Social Factors | 9-11 | | 3.1.4 Technological Factors | 11 | | 3.1.5 Environmental Factors | 11-12 | | 3.2 PORTER's 5 Forces Model Analysis | 12 | | 3.2.1 Threats of New Entrants | 12-13 | | 3.2.2 Threats of Substitute | 13-14 | | 3.2.3 Bargaining Power of Buyers | 14-15 | | 3.2.4 Bargaining Power of Supplier | 15 | | 3.2.5 Competitive Rivalry | 16 | 4.0 | SWOT Analysis | 17-18 | | 4.1 Strengths | 19-27 | | 4.2 Weaknesses | 28-31 | | 4.3 Opportunities | 31-34 | | 4.4 Threats | 34-36 | 5.0 | Marketing Objectives | 37-46 | 6.0 | Marketing Strategy | 47 | | 6.1 Target Market | 48 | | 6.1.1 Behavioral Factors | 48 | | 6.1.2 Demographic Factors | 49-50 | | 6.1.3 Psychographic Factors | 50-51 | | 6.2 Marketing Mix | 52 | | 6.2.1 Product | 52-54 | | 6.2.2 Price | 54-55 | | 6.2.3 Place | 55-57 | | 6.2.4 Promotion | 57 | | 6.2.5 People | 58 | | 6.2.6 Performance | 58 | ...
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...Pricing strategies of low cost airlines Keith J Mason Air Transport Group Cranfield University K.Mason@Cranfield.ac.uk 1. Introduction Low cost airlines such as EasyJet, and Ryanair have developed quickly in the European market in the last five years. The UK market has seen the most dramatic development where by the summer of 2001, these carriers accounted for over 22% of the short haul capacity from London and were present in 58% of the 128 short haul routes operated from this city (source: OAG, 2001). During a five-year period from 1997, the seat capacity offered from London has risen by 17%, and virtually all of this rise (95.4%) was attributable to the low cost carriers. The low cost carriers have both penetrated and grown these markets, principally by garnering a consumer perception that the fares offered are very low. This perception has been developed in no small part by extensive advertising and effective use of public relations. For example, Ryanair has offered fares as low as one penny (plus taxes), and therefore it is not surprising that there is great media coverage of these carriers, which in turn generates more interest in the services. Both Ryanair and EasyJet have been very effective in using media coverage of their legal wrangles with traditional carriers such as British Airways and Lufthansa to promote their services and low fares. While the media has helped these airlines communicate their message of low fares to the public...
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...Factors influencing customer preferences while choosing between budget airlines Applied Research Project Report On Factors Influencing Consumer Preferences while choosing between Budget Airlines Submitted in partial fulfilment of the requirement of Global Masters in Business Administration(GMBA) Information Technology Specialization Submitted by Zarine Susan George GNOV10IT066 Under the guidance of: Mr. Thanneermalai Lakshmanan 1 Factors influencing customer preferences while choosing between budget airlines DECLARATION I hereby declare that the contents of this report titled “ Factors Influencing customer preferences while choosing between budget airlines” is the result of the study carried out by me. I declare that this is my original work and has not been published anywhere before. This Project Work has been carried out for the sole purpose of submission in partial fulfilment of Global Masters in Business Administration (GMBA) in Information Technology Management at S P Jain Center of Management, Dubai-Singapore. The above is true to the best of my knowledge and information. Name : Zarine Susan George(GNOV10IT066) Signature: GMBA Batch 10, Hyderabad road Singapore 2 Factors influencing customer preferences while choosing between budget airlines Acknowledgement I would like to express my sincere thanks and gratitude to all those who helped make this project a reality. This project has been an extremely enriching experience both in terms...
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...G902- Professional Profiling [pic] Travelling Cheap, With JetStar Asia Competitive Analysis Of JetStar Asia In The Low-Cost Carrier Industry |Content Pages | |1. INTRODUCTION | |1.1 What is JetStar Asia? | |1.2 Low-Cost Carrier? | |1.3 JetStar’s Mission | |1.4 JetStar’s Objective | | | |2. SWOT Analysis | |2.1 Strength | |2.1.1 Demographic | |2.1.2 Finance ...
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