...Full Length Research Paper Branding satisfaction in the airline industry: A comparative study of Malaysia Airlines and Air Asia Kee Mun, Wong* and Ghazali, Musa Faculty of Business and Accountancy, University of Malaya, 50603 Kuala Lumpur, Malaysia. Accepted 23 March, 2011 Brand is crucial in differentiating the superiority of products or services over others. This is an exploratory study examining the differences in brand satisfaction between Malaysian Airlines (full service airlines) and Air Asia (low cost airlines) in Malaysia. 350 usable questionnaires were obtained from respondents in the two main airlines terminals in Kuala Lumpur. Exploratory factor analysis revealed seven brand satisfaction dimensions which are tangibles, price, core service, reputation, publicity, word-of-mouth, and employee. Generally, respondents were not satisfied with all brand dimensions of both airlines. The level of brand dissatisfaction is also higher for Malaysian Airlines compared with Air Asia. Air Asia was perceived better than Malaysian Airlines in price, publicity, and word-of-mouth. On the other hand, Malaysian Airlines was perceived better in tangibles, core service, reputation, and employee. The paper highlights some of its theoretical, managerial and marketing implications to the development of airline industry. Key words: Airlines, branding, satisfaction, Malaysia Airlines, Air Asia. INTRODUCTION The world airline industry has gone through a rollercoaster ride for the past few...
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...brand is Air Asia……………………………………………………….3 3.1 Favorite brand and the reasons brand makes great………………………4 3.0 Bad brand is Rayani Air…………………………………………………………6 4.2 The reason why the brand are bad……………………………………….7 4.0 The major competitor of the favorite brand…………………………………..8 4.1 Malaysia Airlines (MAS) the major competitor of Air Asia………….....9 4.2 Competing brands in term of strategy marketing……………………….10 4.3 Difference between Air Asia and Malaysia Airlines (MAS)……………11 5.0 Conclusion………………………………………………………………………13 6.0 Reference………………………………………………………………………..14 1.0 Introduction The aim of this individual assignment of subjects BPMM3113 Brand Management is to make a bit of criticism in connection with the preferred brand and the brand also not favored. This task is also to evaluate the performance of a popular brand of airline Air Asia and also the favored brand of Air Rayani. For the main competition for Air Asia is Malaysia Airlines (MAS). The airline industry is a big industry, a large and rapidly growing nowadays. In those years ago, air travel has increased by 6% a year and scheduled airlines carry more than 1 billion passengers in 2008. In addition, in this study, both the company and the challenges will be discussed in more detail in this report. It will be discussed further in this study are the weaknesses, advantages and competitive strategy used in the aviation industry. MAS Airlines and Air Asia on profitability...
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...Abstrak. Introduction – Air Asia Berhad Pengenalan - Air Asia Berhad Air Asia is a Malaysia Low Cost Carrier Airline Company which was founded in 2001 by Tony Fernandes. Air Asia adalah Kos Carrier Rendah Malaysia Airline Syarikat yang diasaskan pada tahun 2001 oleh Tony Fernandes. It was the first successful and is one of the largest low cost airlines in Southeast Asia. Ia adalah yang pertama berjaya dan merupakan salah satu daripada kos terbesar syarikat penerbangan rendah di Asia Tenggara. Also, it has become Malaysia first international low cost carrier. Selain itu, ia telah menjadi Malaysia antarabangsa pertama penerbangan tambang rendah. Air Asia Company's simple philosophy 'Now Everyone Can Fly' has successfully positioned itself in customers' mind where majority of the customer would choose Air Asia as their choice of transport. Semua falsafah mudah Air Asia Syarikat 'Sekarang Boleh Terbang' telah berjaya meletakkan dirinya dalam minda pelanggan di mana majoriti pelanggan akan memilih Air Asia sebagai pilihan mereka pengangkutan. In add, Air Asia succeed through the company's effective and efficient operational. Di tambah, Air Asia berjaya melalui operasi yang berkesan dan cekap syarikat. The company provides a totally different type of service in line with the nation's goal which is to benefit all people and worldwide travellers. Syarikat menyediakan jenis yang sama sekali berbeza perkhidmatan selaras dengan matlamat negara yang memberi manfaat kepada semua rakyat...
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...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, Thailand and Soekarno-Hatta International Airport, Indonesia, respectively. The airlines established in 1993 and started operations on 18 November 1996. It was originally founded by a government-owned conglomerate DRB –...
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...Airlines: A Business Turnover Name: Course: Instructor: Date: Malaysian Airlines: A Business Turnover Summary Malaysia Airlines ranks among the top government-run agencies in Malaysia. The organization is the national carrier for the country flying to over 100 destinations in six continents across the world. It is based at the Kuala Lampur International Airport where its core operations are run, and recent statistics indicate that it has the strongest influence in East and south Asia regions. However, it is also important to note that its influence is also growing in Europe and Australia, which technocrats believe to be the growing influence in the kangaroo routes leading to Australia and the pacific (Alamdari & Fagan, 2005). The organization has undergone tremendous changes to position itself strategically in the rapidly changing world of air transport. With the increased competition ranging from the swiftly growing carriers including the Emirates, Qatar airways and Etihad airways, and the low cost competitors such as Air Asia and Jetstar to the well-established carriers such as Cathy Pacific and Singapore airlines, the organizations have enacted strategic changes to position itself on the global air transport market. The wakeup call came in 2005 when the airline experienced its worst experience. The Malaysia Airline System achieved success in two years and braced the impact of the financial meltdown that rocked the world at around that time...
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...As stated in the chapter 4, in the section of business model reconstruction had explained enough on how Air Asia make their name available to customers and they can enjoy the profit without abandon the existing name which is Malaysia Airlines. Herewith, what can be explained is it still the same organization, but they changed the business to the new ones which just focusing on the new while they are not abandoning the existing business and bring in new business which there was no one as the first mover? Business model reconstruction can be explained as whenever a business is established, it either explicitly or implicitly employs a particular business model that describes the architecture of the value creation, delivery, and capture mechanisms employed by the business enterprise. Malaysia Airlines are once a privilege to fly where the firm applies entrepreneurial thinking to the design or redesign of its core business models in order to improve operational efficiencies or otherwise differentiate itself from industry competitors in ways valued by the market. And now, Air Asia are been introduced to everyone where the business come out with a new business model of Now Everyone Can Fly that lower the cost that are not necessary. To fly, it is obviously not a need but a want. Air Asia introduced a low cost concept which enhanced travelers to easily travel without stressing their mind about money just for the accommodation which include ticketless travel, online ticket sales, no international...
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...Berhad is the holding company for Malaysia’s national airline carrier, one of the fastest growing airlines in Asia. Malaysia Airlines has three airline subsidiaries, which is Firefly, MAS wings and MAS cargo. Although MAS had provide an excellent services and won many award, they still facing financial problem since year 2002. Situation become worse in year 2014 due to the MH370 and MH17 tragedies occurred. MAS are facing three main problems. First will be financial turbulence. In recent years, MAS has struggled financially. In 2013, the company reported a loss of 1.17 billion ringgit, its third consecutive year in the red. The airline had already been suffering from years of poor performance. The company’s stock price has dropped since MH370 missing and MH17 crashed occurred. A double tragedy of this nature after such a short period is unheard of in the industry, which could deal a crippling reputational and financial blow to Malaysia Airlines Malaysian Airline System Bhd. The second problem is lost confidence of passengers toward the Malaysia Airlines. Due to the disasters of MH370 and MH17, the airlines passengers lost confidence to the Malaysia Airlines which bring the feeling of fear and afraid toward MAS. Those passengers may switch to other airlines such as Air Asia and Singapore Third problem is reputation of Malaysia Airlines be damaged. At the beginning, Malaysia Airlines have a very high reputation and images in airlines industry which received various awards which are...
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...The History of AirAsia Kalo APPLE punya steve Jobs, Air asia punya Tony Fernandes Datuk Tony Fernandes menandai sejarah baru penerbangan komersial dengan meluncurkan Air Asia Berhad di Malaysia. Air Asia adalah armada penerbangan berbiaya rendah (low cost airline) pertama di Asia. Dengan tagline "Now Everyone Can Fly", Air Asia melayani kota-kota utama di 11 negara Asia. Langkah Tony ini meniru Southwest Airlines (Amerika Serikat). Saat proposal konsep penerbangan murah diajukan kepada Perdana Menteri Malaysia, waktu itu Dr. Mahathir Mohamad, beliau mendukung, tetapi syaratnya harus mengakuisisi maskapai yang ada, karena ijin baru telah ditutup. Ini merupakan tantangan awal. Namun tidak berapa lama Tony dapat kabar bahwa Asia Air yang awalnya milik seorang bangsawan kaya Malaysia sedang menuju kebangkrutan, akan dijual. Maka, dengan hanya 1 Ringgit Malaysia (Rp 2500) maskapai itu dibeli. Untuk itu dia dapat dua pesawat Boeing 737-300, tapi harus menanggung hutangnya yang hampir Rp 100 milyar. Konsep penerbangan murahnya ternyata berhasil. Dalam waktu tujuh bulan (Desember 2002) dia sudah memperoleh pemasukan Rp 282,5 milyar, membukukan keuntungan Rp 48,5 milyar, dengan 1,1 juta penumpang. Dengan sukses ini tantangan yang menhadang di depan adalah persaingan dengan Malaysia Air Service (MAS), maskapai milik pemerintah Malaysia , seperti Garuda di Indonesia. Untuk itu Tony memilih untuk membuka rute penerbangan regional, keThailand dan Indonesia . Dan ini tantangan yang tidak...
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...In Malaysia, airlines are separated into two; 1) Passenger airlines and 2) Cargo airlines. The passenger airlines in Malaysia are Air Asia, Malaysia Airline System Berhad (MAS), Firefly which is owned by MAS, Layang-Layang Aerospace which is based in Sabah to provide air services to Layang-Layang Island, Berjaya Air which is owned by Berjaya Group, Sabah Air and last but not least Hornbill Skyways which is a helicopter service that operates in the rural area of Sarawak. Other than passenger airlines, there are also three cargo airlines that operate in Malaysia. They are the Athena Air services, MAS cargo and Transmile Air Services. Despite the various kinds of air operators, the airline industry in Malaysia is being monopolized by two main operators. The first one is Air Asia and the second one is Malaysia Airlines System Berhad (MAS).MAS was founded in 1947 by Malayan Airways. With the formation of Malaysia in 1963 the airline changed its name soon after to Malaysian Airlines.MAS is the government owned flag carrier airline of Malaysia. Malaysian Airline System Berhad (Malaysia Airlines) provides scheduled airline transportation services from Malaysia. It principally provides passenger and cargo transportation services through its fleet of 129 aircraft and serves more than 100 destinations across the world. The company also offers maintenance, repair and overhaul services for aircraft. Moreover, the company offers services such as engineering, catering, computerized reservation...
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...Campos, VP of Sales From: Kate Chaplain, Senior Sales Associate Date: April 5, 2013 Subject: Quarterly Review Mr. Campos, Purpose: Air Asia X Berhad Initial Public Offerings (IPO) of Ordinary Shares Road Show was held on the 29th of June 2013. The purpose of this memo is to determine whether we, as large foreign institutional investors should buy or not to buy Air Asia X Berhad IPO shares with fundamental analysis and findings. Besides deciding whether to buy or not to buy, we will justify the reasons underlying our decision that we have come across that we are not buying Air Asia X Berhad IPO shares. Background: Air Asia X is a long-haul, budget airline based in Malaysia. The airline is operated by Air Asia X Sdn. Bhd. It is claimed by the company’s management that they are a leading low-cost, Long-haul airline, operating primarily in the Asia Pacific Region. Also, they believe that they have the lowest unit cost base of any airline in the world. This in turn has enabled them to offer fares that are targeted, on average, to be 30% - 50% lower than FSCs and to stimulate new market demand, whereby passenger volumes between Kuala Lumpur and other destinations they serve grew by an average of over 90% from the year before the launch of each route to the year ended 31December 2012. They currently serve 14 destinations across Asia (Tokyo, Osaka, Seoul, Taipei, Beijing, Hangzhou, Chengdu, Shanghai and Kathmandu), Australia (Sydney, Melbourne, Perth and Gold Coast) and...
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...in other country. In Government regulations of the Malaysian domestic and international aviation industry significantly affect financial performance of Air Asia. All aspect of Air Asia’s domestic airline operations in Malaysia, including slots allocation granting of rights under Malaysia’s air service agreements (“ASAs”) and insurance of AOCs, are subject to regulation by DCA. Aviation activity is managed by the organization within the MOT called DCA. The objective of DCA is to ensure direct service provider operates the air transportation (aviation) system is always safe for passenger. The growth of the AirAsia’s strategy is obtained by increase the flight’s frequencies to the market that is currently serves and expanding market’s number that is serves. The growth strategy can be success depends on additional traffic right that is obtained to suitable airports located in targeted geographic markets of AirAsia. Ministry of Transport and Malaysia Airports (MAHB) decided to increase the airport tax by RM7 and RM14 with the approval of government at the five airports which is Langkawi International Airport, Penang International Airport, Kuching International Airport, Terminal 2, Kota Kinabalu International Airport and the low-cost carrier terminal (LCCT) at KLIA. Air Asia is not happy with the Ministry of Transport and Malaysia Airports (MAHB) decision and trying to ignore as it can increase their cost and some more...
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...STRATEGY PROCESS MODELS 1.0 STRATEGIC ANALYSIS Business Process And Operation Air Asia has fostered a dependency on Internet technology for its operational and strategic management, and provides an online ticket booking services to traveler online. The following shows the home page of Air Asia.com as the company key channel of marketing and sales. Exhibit 1 – Air Asia.com Home Page To book a flight with Air Asia, customers can either choose the following channels or simply visit the Air Asia.com home page and follow the below 5 steps. 1. Call centre 2. Sales office and airport sales counter 3. Authorized travel agents 4. Mobile booking via mobile.Air Asia.com or 5. Online (http://www.Air Asia.com) in 5 easy steps as shown below. Step 1 - Search Step 2 - Select Step 3 - Guest & Contact Step 4 - Payment Step 5 – Itinerary The Product Life Cycle (PLC) Air Asia, Airlines Company with 58 flight destination is in the growth phase position of Product Life Cycle (PLC) stage. The growth phase is when loyalty begins to be built up. Some products or services can be taken up by the customer base very quickly and achieve rapid growth. Sales of Air Asia Airlines grew tremendously in every country in which they were available. It is during the growth phase that the product will begin to recover its development and launch costs and slowly move through the break – even mark to begin to make a profit for the organization. During the growth stage of a new...
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...Air Asia Case: Q 1) Comment on business level strategy adopted by Air Asia? How has Air Asia achieved cost leadership? Answer 1) High aircraft utilization: Air Asia uses the aircraft in very high frequency and high turnover of flights; these add value to customer convenience and enable low cost. Air Asia has the fastest turnover in its region; is 25 minutes. a) Low fare no frills: Air Asia does not have frequent flyer miles program and private airport lounge. No free foods and beverages even snack in flight, additional meal and service required passenger to pay more. b) Point to point network: All Air Asia both short-haul (4 hours or less radius) and medium to long-haul are non-stop flight, by doing that; save human recourses cost, facilities cost, airport cost, etc. c) Air Asia changed all existing old aircraft Boeing B737 with Airbus A320, which has more capacity, more efficient fuel-consume and cost-efficient. d) By utilizing homogeneous aircrafts, the company is able to save human resources cost and reduce spare part stocks. These strategies have brought Air Asia as the lowest-cost airline in the world, with a cost/ASK (available seat kilometer) of US3.67. This great achievement was achieved without compromising safety. Air Asia’s highest priority is safety of all the operations. To keep the aircraft in best condition Air Asia partnered with the best maintenance provider. e) Air Asia R&D not only works on the aircraft utilization but also...
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...the organization and the plans and actions to achieve the purpose. It is that set of managerial decisions and actions that determine the long term performance of a business enterprise. It involves formulating and implementing strategies that will help in aligning the organization and its environment to achieve organizational goals."( Hambrick, D. C.; Chen, M.-J (2007).) Air Asia was established in 1993 and commenced operations on November 18, 1996.Initially established by the Government of Malaysia, state-run group DRB-Hicom. December 2, 2001, the former Time Warner manager Tony Fernandes private company Tune Air Sdn Bhd M & A heavily indebted airline, in order to 1 Ringgit acquire, together with the debt of 40 million ringgit. The turnaround in 2002, the creation of a number of new routes to the hub airport as the center of Kuala Lumpur, to attract passengers to the promotional price of 1 Ringgit price erosion Malaysia Airlines previously dominant market. Air Asia is Malaysia Airlines, Asia's largest low-cost airline. A total of more than 400 domestic and international scheduled flights of Air Asia Group waypoints, spread across 25 countries, its main hub airport for low cost to Terminal...
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...1. BACKGROUND Air Asia Berhad is the only Malaysian-based low cost airline and also a pioneer of low- cost travel in Asia. The main hub is the low-cost carrier terminal (LCCT) at Kuala Lumpur International Airport. Air Asia was established in the year 1993 and started its operations on the 18 November 1996. Originally, it was founded by a DRB-HICOM which is the government owned conglomerate. Then, Tony Fernandes’s company which is Tune Air Sdn. Bhd. bought the company on the 8 September 2001 with estimation of RM 40 million debts. The operations of Air Asia began on 8 December 2001 until now. There are many continuous transformations that Air Asia makes in order to succeed, to achieve its strategic mission and vision and also to sustain in the industry. According to the continuous transformations by the Air Asia, we can classify it into three main phases which are Phase I (from the year 2001- 2004), Phase II (from the year 2005 to 2008) and Phase III (from the year 2009 to present). For further overview, we narrow down the changes based on the: 1. The company and its marketing 2. The customer relationship management The company is includes how Air Asia planning the changes they want to implement and what Air Asia do in order to increase its effectiveness. Then, the marketing is refers to the changes in terms of marketing. Lastly, the customer relationship management is refers to the ways and strategies that Air Asia used to build and maintain its relationship with...
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