The market has confronted critical competition in the form of new competitors who have also introduced low-cost flights. SIA introduced 2 budget airlines; ValuAir and Tiger Airways.. This paper will examine the results of the strategic actions of AirAsia in the Malaysian domestic airline market. The purpose of this report is to examine the market environment for AirAsia, which has established its business in Malaysia. Do you have a 2:1 degree or higher? Airasia may be small portion of customer whom orders 200 aircraft from the total 9,113 aircraft order from other customer of Airbus. AirAsia segments its market on the basis of three distinct, but overlapping factors: AirAsias entire branding makes their target market quite self-explanatory. Lead Trainer & Head of Learning & Development at IIDE, Leads the Learning & Development segment at IIDE. And thus Indians meet their target requirements perfectly, Government charges and costs that are not in the control of the company may lead to severe losses in the future, With dynamic management and other operational costs, it becomes difficult to manage low-cost flights, AirAsia has 62.K followers on Instagram, 93.5K followers on Twitter, and 12M likes on Facebook, They post regularly on their pages, at least a couple of times a week, and maintain this consistency, They post a variety of content that aims at staying relevant in the minds of the customers, Their main strategy seems to be posting about exotic travel destinations with Call-to-Action, encouraging customers to avail their services in exploring these locations, The company also posts environmentally friendly content to echo the ethos of its brand. Points to consider while selecting a topic for dissertation help. Luggage handling is the major factor that is considered by the customer as well as the airlines industries and in context to this fact, Malaysia Airlines provides average 15 kg of luggage, and it does not include any additional charges in case there is few more luggage than the normal capacity provided by the airlines. The Marketing mix refers to the set of actions and tactics which a company uses to promote its brand. Browse marketing analysis of more brands and companies similar to Air Asia. Lets see how they compare amongst a few key indicators. It offers scheduled flights and chartered flights for passengers, and also provides air cargo services (AirAsia, 2018). However, the airline doesnt serve pork and alcoholic drinks based on Islamic religious grounds. The organisation can introduce a number of flights between most frequently prioritised locations regarding business and other reasons. Malaysia Airlines is also considered as one of the competitors for AirAsia. Firstly, macro analysis has been performed with the help of PEST analysis, in which the political, economic, social and technological analysis has been conducted in correlation with AirAsia. Basic things to know before seeking help in assignment. However, there is also a barrier to the establishment of the new entrant in the airlines, which is the high start-up cost that is required for the airline services. Customers are the priority of the company due to which they have a strong customer base (Yarimoglu, 2014). Use Slintel to connect with top decision-makers at AirAsia. Home Samples Marketing Environment Analysis of Air Asia. All work is written to order. Step 3- Assess the Porter Five Forces in relation to the industry and assess which forces are strong and which forces are weak. Quizzes test your expertise in business and Skill tests evaluate your management traits. Hence this concludes the Air Asia SWOT analysis. In this section of the blog, we shall understand AirAsias marketing with the help of its STP (segmentation, targeting, and positioning) strategy. The headquarter of the company is in Kuala Lumpur International Airport, Sepang, Selangor,Malaysia. The route network of AirAsia is one of the largest in the world, which covers more than 20 countries all around the world. Air Asia is one of the leading brands in the airlines sector. Rise of Other LCCs in Market. We're here to answer any questions you have about our services. WebThe Competitors analysis of AirAsia Flying Low Cost with High Hopes looks at the direct and indirect competitors within the industry that it operates in. SilkAir 3.Tiger Airways Hence this concludes the Air Asia SWOT analysis. Other than that, hes a fun loving person. Air Asia comprises of a capable and dedicated customer care team, which is committed to resolving the complaints by the customer as soon as possible. Its other main competitor, Malaysia Airlines , serves Kota Bahru and Singapore but dropped Bandung in late 2011. It allows its customers to choose the services they want without compromising on quality. The increase in oil prices has critically impacted the operations of the organisation. Air Asia also engages itself in the promotion of the company through social media, print advertisements, and effective billboard advertising (Mele, Pels and Storbacka, 2015). They have been a major player in the low-fare airline industry and have connected over 88 countries together. In order to establish a new airlines company, high amount of capital along with risk-bearing capabilities and monetary funds to cope up with the challenges faced while sustaining in the airline industryare required. AirAsia X share began trading on Bursa Malaysia, formerly known as the Kuala Lumpur Stock Exchange, on 10-Jul-2013. Certain weaknesses can be defined as attributes which the company is lacking or in which the competitors are better. Our academic experts are ready and waiting to assist with any writing project you may have. Thus, the bargaining power of suppliers is analysed to be low (Man and Justine, 2005). Its routes include both domestic and international flights. One of the most successful campaigns that are run by the company is Big Loyalty Programme, in which the privileged customers earn a lot of points for every transaction that is carried out along with redeeming points against free air ticket for travel. Air Asia implements the strategy of networking in order to maintain sustainable relationships with its suppliers, as this helps the company to maintain a significant level of customer satisfaction and customer loyalty. AirAsia was bought over by Tony Fernandes, the current chief executive officer of AirAsia from DRB-Hicom on 2nd December, 2001 (Soon, 2017). This marketing mix 7 Ps model is used to explain the marketing strategy of Air Asia. AirAsia uses anchor pricing to offer incredibly low rates on its services and fares, enticing consumers to consider traveling with the airline. The company maintains its logo by providing high-quality exterior services of the aircraft along with the interior seats and the uniforms. Along with these improvements, if AirAsia continues to deliver to its target market effectively, it will surely maintain its differentiated position in the industry. The competitions are depending on the services provided and the suitability of the flight time for the customer. Management of costs: Air Asia is finding it immensely difficult to manage the fluctuations in costs of This increases the probability of people to avail of airline services frequently. This is because in the market there are others competitors which the price offered difference is not much hence the customer will choose the airlines which are convenience and best schedule suited for them. The airline offers 0.023 dollars per seat kilometer fare to its customers, and it is the worlds lowest airline fare. Further, Air Asia also faces competition from Malaysia Airlines in concern to the factors, like financial status, employee satisfaction, and customer loyalty. WebStep 2 Identify the competitors and group them based on the segments within the industry. Below are the top 3 competitors of Air Asia: 1.Jetstar Airways 2.SilkAir 3.Tiger Airways. Through its efficient STP, AirAsia has been able to successfully develop its marketing strategy and make a name for itself in the market. AirAsias mission is to be the best company, which ensures good relations between its management and employees, to make everyone fly with AirAsia by attaining the lowest cost, employ new technology to maintain highest quality products and enhance service levels. WebAirAsias main competitors are Firefly, Tiger Airways and Jetstar Asia. Strict regulation and prioritisation by the UMNO (United Malays National Organisation) authorities to implement uniforms for the hostess. Any opinions, findings, conclusions or recommendations expressed in this material are those of the authors and do not necessarily reflect the views of UKEssays.com. The cost-cutting strategies of AirAsia are effective and beneficial in terms of financial growth and maintenance (Ahmad and Neal, 2006). Air Asia has expanded their product line by not only sales ticket but also offering tourism package which is offering hotel booking while booking the ticket. Another important strategy that Air Asia will consider enhancing is improving Information Technology (IT) services in the company, as well as in the aeroplanes. Malindo will compete against AirAsia on all three routes. Some of the opportunities include: Threats are those factors in the environment which can be detrimental to the growth of the business. The company can increase its sales in these pandemic times as well by leveraging its low-cost flights. WebStep 2 Identify the competitors of Airasia and group them based on the segments within the Transportation industry. Air Asia operates flights to around 165 destinations that include both domestic and international with a fleet size of 92. Competitive analysis involves identifying your direct and indirect competitors using research to reveal their strengths and weaknesses in relation to your own. There are several brands in the market which are competing for the same set of customers. Air Asia is a low-cost airline headquartered in Malaysia. Bargaining power of Buyers The buyer power for Air Asia is analysed to be high as with increasing options in the international market and decreasing prices of air tickets, people of every category of society can afford flying, and hence, the bargaining power of buyers is also high. The airline has four subsidiaries including Air Asia X, Indonesia Air Asia X, Indonesia Air Asia and Thai Air Asia. AirAsia has 5 employees at their 1 location and RM1.84 b in annual revenue in FY 2021. AirAsia also acquired recognition for improving its supportive and constructive management, as it received rewarded by Center Asia Pacific Aviation (CAPA) as the best airline of the year. Thai AirAsia faces new competitive threats in Thai Lion and Thai VietJet. It was named as the Best Low-Cost Airline Company in the world for 9 consecutive years at the Skytrax World Airline Awards. The organisation may gain significant benefits during tourism seasons considering the various tourism locations in Asia. Similarity in product offering. AirAsia uses various media platforms for the marketing and promotion of its products and services. The company is constantly using innovative solutions to provide low-cost transportation. The company makes use of robust enterprise resource planning system, which allows it to successfully maintain process integrity, speeds up reporting, and data retrieval process. The weaknesses of a brand are certain aspects of its business which are it can improve to increase its position further. WebEducational Research: Competencies for Analysis and Applications (Gay L. R.; Mills Geoffrey E.; Airasian Peter W.) Forecasting, Time Series, and Regression (Richard T. O'Connell; Anne B. Koehler) Rich Dad, Poor Dad (Robert T. Kiyosaki) Air Asia Strategic Analysis The paper is prepared to analyse the strategic management of AirAsia which is Fixed cost incurred by an airline company may include the finance cost, hire purchase and staff cost while this fixed cost may be reduce through increase in market share. Marketing mix 7 Ps and SWOT analysis can improve the brand value of AirAsia and identify the strengths and weaknesses of AirAsia along with determining the future opportunities. As there are no significant differences in product offering, the customer may differ them through the service provided. The company constantly invests in improving the facilities it provides to the passengers and has introduced facilities, such as in-flight meals, complimentary WiFi, entertainment facilities such as separate televisions for passengers, and seat options including flatbeds (Abdullah, Chew and Hamid, 2017). Exit Cost is high. Lets get into discussing their marketing efforts, starting with their marketing mix. As compared to the services of the AirAsia,Malaysia Airlinesprovides better services and gain efficient customer satisfaction. Fixed Cost is high. The biggest competitors of AirAsia though, are Malaysian Airlines and JetStar Airways. Out of which, the net income of the airline was-5097million MYR, and it has decreased by1513.76%. It has subsidiaries in Indonesia, Thai, Phillipines, Japan, 5.It has a fleet size of nearly 300 aircrafts. Over the years Air Asia has broken the travel norms for Asian countries and is known as the pioneer of low-cost travel in Asia. This model is widely implemented by various organisations for the development of their strategies in the industry. The Essay Writing ExpertsUK Essay Experts. AirAsias marketing strategy has worked wonders for the company in communicating exactly what they wanted to the customers. Today, well discuss the swot analysis of AirAsia. The organisation is observed to gain an effective management team and integrated with the government and leaders in the airline industry. Since the airline brand follows the tight costing strategy and it allowed the company to offer cheap fare to the customers. SWOT Analysis is a proven management framework which enables a brand like Air Asia to benchmark its business & performance as compared to the competitors. AirAsia is already trying to achieve that by expanding their facilities to hotel bookings, tour packages, etc to try and gain some competitive edge along with diversifying their product portfolio. This company also operates through affiliated airlines, such as Thai Air Asia, Indonesia Air Asia, Philippines Air Asia. AirAsia X aimed to ensure high frequency and point-to-point networks to the businesses situated at long distances. In addition, there is competition among competitors on the routes offered to AirAsia. The Indian market is highly price-conscious. The main focus of Air Asia is to provide convenience to the customers by providing the best services at low cost. As per the past experiences and the feedback of the customers, Malaysia Airlines are found to react their destinations on time in comparison to AirAsia. As compared to industry leaders, they dont operate on as many routes, Merging with other low-cost airline companies, They can introduce more flights for popular and busy destinations, The increasing traffic from India as Indians prefer budget airlines. With the increasing number of services by different competitors, AirAsia has also expanded its facilities including the tour packages and hotel booking services that help the company to sustain in the market. MBA Skool is a Knowledge Resource for Management Students, Aspirants & Professionals. This has raised the threat of substitution for Air Asia, as in any case of customer dissatisfaction or unavailability of service, it will be easy for the passengers to shift to some other airline company. The case involves the This reduces the chances of small or medium enterprises to enter this industry, and hence, the threat of new entrants for Air Asia is very low. Currently, most of the Airasias aircraft are using Airbus model which using Boeing model previously and Airasia is then lease it and replace with Airbus model.If in case Airasia may wish to switch to Boeing again, the cost of training employee in operating the aircraft feature is high. Government regulations are strict. The article below lists the Air Asia SWOT, competitors and includes its target market, segmentation, positioning & USP. There is no product differentiation while the only different is the airlines packages offered. The company also engages in direct service development strategy by treating employees as an essential part of the organisation. Very interesting and informative. It would be a strong competitive edge to AirAsia after the pandemic ofcovid-19because the purchasing power of the people has dropped significantly. The distribution channels for the tickets include different sources such as internet ticket booking, exclusive reservation, and sales offices along with the agents that are authorised by the company. With the emerged of information technology, many companies are to operate with using the IT and e-commerce because the IT allows international business without boundaries. Some of the key weaknesses of Air Asia are: Opportunities refer to those avenues in the environment that surrounds the business on which it can capitalize to increase its returns. Ease to switching. Today it is one of the most reputed Asia-based airline companies. The important thing the buyers look for is the fly to destination which shows the strong bargaining power of buyers. Disclaimer: This is an example of a student written essay.Click here for sample essays written by our professional writers. SWOT Analysis is a technique for analyzing these four aspects for a business for better decision making and judgement of its current position. Heres the swot analysis of AirAsia as follows; AirAsia has a large fleet size comprising300aircraft. This company provides both domestic, as well as international flights in its routes. In order to stay ahead of the competition, the company needs to constantly invest in improving the additional facilities that make a difference to customers in todays times such as disposable in-flight meals, complimentary WiFi, entertainment facilities, and varied seat options. Some more of these improvement areas can be found through its SWOT analysis. Some important factors in a brand's strengths include its financial position, experienced workforce, product uniqueness & intangible assets like brand value. These are people ranging from those who could not afford to fly previously, to corporate business employees whose employers are looking to fly them while cutting costs. (vitag.Init = window.vitag.Init || []).push(function () { viAPItag.display("vi_23289101301") }). can be threats. Air Asia Competitor analysis In order to compete with AirAsia,. Continue reading more about the brand/company. This has been possible due to the companys relentless communication through various marketing channels. In anchor pricing strategy, the company prices its services along with the tickets at a low price. Rising Labour Costs 3. AirAsia focuses on providing guests with comfort through competent facilities that meet industry standards, as well as regular flights and secure point-to-point connectivity. Government regulations which target various aspects such as particular routes, landing permissions and share possession cause a drastic impact on the operations of the organisation. AirAsia Airline As the best low-cost passenger. Some factors like increased competitor activity, changing government policies, alternate products or services etc. High numbers of Competitor. In addition to this, various political factors can be highlighted by influencing the operations and management of AirAsia which have been mentioned below. Many airline companies have entered the airline industry and they have made the market very competitive. Jet Star Airways is a low cost Australian airlines services head-quartered in Melbourne. AirAsiastop competitorsareAir India,American Airlines,Emirates Airlines,British Airways,Delta Airlines, Tiger Airways, Silk Air, Jetstar Airways, and many others. 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