In 2002, AirAsia became the first airline company in the region that allowed passengers with the facility to pay for their bookings by using credit card. Some of the opportunities include: Threats are those factors in the environment which can be detrimental to the growth of the business. In this section of the blog, we shall understand AirAsias marketing with the help of its STP (segmentation, targeting, and positioning) strategy. 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. The company has partnered with the worlds most famous maintenance providers to ensure its passengers safety. Use Slintel to connect with top decision-makers at AirAsia. Thai AirAsia faces new competitive threats in Thai Lion and Thai VietJet. Thus, the customer may choose to purchase premium airline which may offer them more comfortable facility in almost same price with Airasia. The organisation may gain significant benefits during tourism seasons considering the various tourism locations in Asia. If your specific country is not listed, please select the UK version of the site, as this is best suited to international visitors. Step 3- Assess the Porter Five Forces in relation to the industry and assess which forces are strong and which forces are weak. All work is written to order. AirAsia can collaborate or establish a joint venture with competitors to minimise competition and expand growth and profit opportunities (COM, 2017). KLIA-Singapore is also served by four Singapore-based carriers Jetstar Asia, Tigerair, SilkAir and Singapore Airlines. AirAsia is a global airline with operations in more than 160 destinations in 25 countries. The article below lists the Air Asia SWOT, competitors and includes its target market, segmentation, positioning & USP. 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). We've received widespread press coverage since 2003, Your UKEssays purchase is secure and we're rated 4.4/5 on reviews.co.uk. Another important strategy that Air Asia will consider enhancing is improving Information Technology (IT) services in the company, as well as in the aeroplanes. Required fields are marked *. Rising Fuel Costs 2. The verdict overturned the Malaysian Competition Commission (MyCC) ruling that AirAsia and Malaysia Airlines (MAS) had colluded to share the market. This model is widely implemented by various organisations for the development of their strategies in the industry. 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. In addition to this, various political factors can be highlighted by influencing the operations and management of AirAsia which have been mentioned below. This paper will examine the results of the strategic actions of AirAsia in the Malaysian domestic airline market. Rise of Other LCCs in Market. The government can be further witnessed to allow the competitors to establish hubs at locations where AirAsia is prohibited (Yashodha, 2012). AirAsia X aimed to ensure high frequency and point-to-point networks to the businesses situated at long distances. The company will increase the current IT facilities used in the aircrafts to enhance the facilities provided to the customers. It employs an anchor pricing policy, which establishes a baseline for pricing all AirAsia-operated flights. The organisation can be witnessed to confront critical competition from the competitors who are facilitating similar costs and additional services and privileges which act as a drawback for the organisation (Man and Justine, 2005). The company engages in anchor pricing strategy in its marketing mix. It would be a strong competitive edge to AirAsia after the pandemic ofcovid-19because the purchasing power of the people has dropped significantly. Diversified in product offered. AirAsia managed to become one of the most popular and profitable airline companies in the world by implementing visionary leadership and innovative business approach. The brand colours of Air Asia are red and white, which represent determination along with passion, perfection, and positivity to serve customers high-quality services at low prices (Mele, Pels and Storbacka, 2015). From simple essay plans, through to full dissertations, you can guarantee we have a service perfectly matched to your needs. The case involves the Hence the airlines companies have more sales on individuals tickets rather than the groups of customers. Aircraft supplier could be the one who gaining most bargaining power as there are only two in operation, Boeing or Airbus. AirAsia is known for its low fares and no-frills policy. The headquarter of the company is in Kuala Lumpur International Airport, Sepang, Selangor,Malaysia. Tiger Airways. It was started in 1993, and the operations began in 1996. Brands, such as Jet Star Airways and Tiger Airways, are sustaining in the competition as they also provide air transportation at cheap costs to people along with enhanced in-flight services and varied options for passengers.This directly affects the customer strength of Air Asia, andthese companiespose a threat to the company. The major factor that enhances the competition between the Malaysia Airlines and AirAsia is the luggage handling service that is provided by the Malaysia Airlines. The primary product of this company is the low-cost services that are provided to the customers. AirAsia X share began trading on Bursa Malaysia, formerly known as the Kuala Lumpur Stock Exchange, on 10-Jul-2013. Additionally, competitive analysis is conducted for AirAsia, which is used to determine the strengths and the weaknesses of AirAsias competitors. This LLC trend has saturated the customer market, and it has declined the overall profitability of AirAsia. That was AirAsias 4Ps mix, detailing each strategy and its purpose. They have official handles on all major platforms but for the purposes of this segment, we shall take a look at the main 3, which are Instagram, Twitter, and Facebook. The bargaining power of buyers is strong when the switching cost of airlines is low. If you did, be sure to share, comment, and let us know! Competition: The company faces a lot of competition from brands such as Air India, Singapore Airlines, Virgin Airlines etc. Airasia are now facing competition with approximately 59 low fares airline such as JAL Express, Tiger Airways, Air Arabia, JetStar Airways, and etc. Student Life Saviour is a prominent name in providing assignment, essay and dissertation help services to students. Student Life Saviour 2022 - All rights reserved. The increasing fuel cost and the labor cost have amplified the overall expense of AirAsia. can be threats. Air Asia can also implement a cost leadership business strategy. Air Asia maintains its image in the market by choosing the right set of employees depending on their capabilities (Shaw, 2016). The complaints received by the organisation are identified to be the consequences of low prices as the organisation may face critical problems in ensuring service and assistance with the low-cost flights. Air Asia is known for treating its employees and customers well. 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. Do check. They may force to continue their operation even they are facing losses in order to cope with fixed costs. Furthermore, competitive analysis has also been conducted for AirAsia in this report along with marketing mix 7 Ps and SWOT analysis. Besides @flyairasia and However, the airline doesnt serve pork and alcoholic drinks based on Islamic religious grounds. It is an international airline that began operations in Malaysia and has since expanded to include countries across the Asian continent, such as India and Thailand. AirAsia is headquartered in Malaysia and provides transportation services to its passengers along with cargo and courier services. The focus of AirAsia was on maintaining its low-cost policy and in context to that AirAsia X was launched in 2007. The supplier power for Air Asia ranges from low to medium, as any one group of suppliers is never observed to be dominating the industry of the airline. Exit Cost is high. Focusing on providing air travel without frills at substantially lower prices, AirAsia has managed to achieve lower prices to attain high passenger loads, market share, and profitability by eliminating provision of Following is the SWOT analysis of AirAsia: Lastly, lets take a look at AirAsias social media marketing presence as digital marketing is also a very important part of any companys marketing strategy. The company was observed to initiate low-cost tickets during the recession which assisted in establishing a prioritised reputation for the organisation. Like Manchester United, Queens Park Ranger, Jamshedpur FC, Singapore national football team, Malaysia national football team, and others. However, the company has employed more than20,000employees to manage its worldwide operations. AirAsia is a low-cost multinational Malaysian airline. MBA Skool is a Knowledge Resource for Management Students, Aspirants & Professionals. Lets see how they compare amongst a few key indicators. 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. Some of the threats include: If you liked this article, we bet that you will love the Marketing91 Academy, which provides you free access to 10+ marketing courses and 100s of Case studies. Business is my passion and i have established myself in multiple industries with a focus on sustainable growth. The bargaining power of buyers is strong because most of the customers for Airlines Company are individual travellers instead of travel in group. This is due to Airbus is a UK based aviation company and their customer may come from around the world. Swot Analysis of AirAsia Berhad. Rising Labour Costs 3. Considering the competitive characteristic of Malaysian airline market, AirAsia has comparatively gained significant customer attention from the customers due to its affordable tickets and additional services. The increasing traffic from India and Indians prefer budget airlines as they are cost conscious 2. AirAsias marketing strategy has worked wonders for the company in communicating exactly what they wanted to the customers. Lets understand AirAsias competitors better with analysis. AirAsia Berhad also facilitates in operating businesses, related financial services and airline operation services. The airline claims No Admin Fee, but all the services provided by AirAsia are not free, it has some fees for some services. Supplier concentration in a few hands. Although the two major suppliers of aeroplane structures are Airbus and Boeing, the suppliers of other facilities required in an aeroplane, for hospitality services including food and merchandise, are available in adequate amount in the market. Air India to discontinue Vistara after merger, DS Group Partners with Lderach (Swiss Chocolate Maker), Castrols unveils a New Logo and a Refreshed Brand Identity. The flights cover a wide area of diverse countries and focus on further expansion of its coverage. Furthermore, landing charges can be identified as the negative aspect resulting into underdevelopment of the airline industry as the aviation sector is strictly obligated to abide by precise air rights regulations and norms. Will increase the current it facilities used in the industry saturated the customer may from. Cover a wide area of diverse countries airasia competitors analysis is known as the Kuala Lumpur Stock Exchange, on 10-Jul-2013 will... 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