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The Development and Future Strategy of Ryanair

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The development and future strategy of Ryanair

Ryanair became in 2009 the airline company which carry the most passengers in Europe. That is the result of its strategy which is based on a ‘no frills’ service in order to offer the lower prices. The business model of Ryanair is different from the classic carriers’ in the way that 20% of its revenue is generated from ancillary revenue, such as its “buy on board” program or extra fees for luggage. As we have seen above, the airline industry is very dynamic, and the apparition of alliances within the market forces Ryanair to stay competitive in its environment. Until now, the company did it very well by being emergent, its flexible structure and culture allowed Ryanair to be the number one on its market. To keep this place, Ryanair needs to adapt itself by choosing a development strategy. For that, there are different directions that Ryanair might take.

Development opportunities

“In a decade or so, airlines will pay the travellers to distribute people around Europe” Michael O’Leary, the Ryanair’s CEO summarizes the future direction of its company with this sentence. Therefore, Ryanair has to continue to find innovative cut reduction methods, as well as innovative revenue generation methods. In order to remain competitive with its business model, Ryanair will need to have the largest amount of routes in Europe and the lowest fare. It is now clear that there is only room for one or two major actors in the low-cost airline market (88% of the market shared by Ryanair and Easyjet). We are going to examine where the opportunities of development are, and how Ryanair will keep its fare at the lowest, by cutting the costs and by finding new ancillary revenue generations.

Market development:

The opening of new markets, the rise of the number of travellers and the new competitors force Ryanair to constantly try…...

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