Prod Offering of British Airways - Book Report/Review Example

 Prod Offering of British Airways Executive Summary This report on the current holiday newspaper campaign of British Airways contains its critical analysis. In the first section the product offered in the campaign has been analyzed in comparison to the competitor’s products. Additionally, the visual impact of the advertisement along with its attractiveness using several marketing models and theories has been criticized. Its positive points have also been mentioned however, over all the campaign does not come up to the current need of the consumers. Suggestions have thus been made to use other media to reach the consumers. Brighter colors with better visuals have been suggested for the current advertisement. A magazine advertisement instead of newspapers has also been suggested to curtail costs. At the same time, it has been suggested to run PR and personal selling activities along with the print campaign to make a bigger impact. The USP should also be highlighted more effectively. Moreover, British Airways should also target other niches as the current one is almost saturated. Lastly, the firm should focus on CSR which will add credibility to its advertisements and promotions. 1 Introduction British Airways is the leading Airline of UK however, in times of economic slumps, every firm needs to be cost effective yet create a lasting impact to win customer loyalty (British Airways 2009). An attempt has been made in the report to help the firm achieve that. The report critical analyses the newspaper advertisement of British Airways which is running for the current holiday season. In the first section the product, its target market, competition and its USP etc are discussed. In the next section, the visual impacts of the advertisement are scrutinized. Next, the suggestion is made to use an alternative media along with PR and personal selling for a better impact. At the same time new distribution channels are explored for the product and are critically viewed. Another section gives suggestions for conducting a research for old passengers that will help them travel more conveniently. Lastly, conclusions and recommendations are given. 2. Prod offering of British Airways, competition and customer base 2.1product offering featuring in the campaign In the advertisement, the product that British Airways is offering is low priced air tickets internationally to certain cities where the cost of hotels and rented limozine is included. According to El Sehity et al, (2005), the firm has used psychological pricing by tagging the price of tickets about a pound lower than Air Canada on every ticket. The customer will be free from the hassle of searching for the best priced hotels and no availability trouble. The hotel is for 2 people and it can be selected by the customer. The tickets are either one way or two way depending upon the preference of the consumer. 2.2 targeted market segments According to Porter (1985) the more specific the target audience, the better customers are satisfied. The targeted market segment of the advertisement is those wishing to go for a holiday. However, those who are travelling to a new destination for the first time are being targeted. The market segment has thus been well defined. 2.3 product comparisons with competitors The product compared with a parallel promotion by Air Canada is much better. This is because Air Canada is offering up to 300 hours of complimentary movies while travelling to North America. However, it is something that all airlines give now and has nothing different. This is not adding convenience, value of comfort in the travel. However BA is offering added convenience and using Value Added Focus according to Porter (1985), with the product which will make the whole travelling experience much more convenient and pleasurable. On the other hand, Easy Jet is offering 25% off on all tickets and has formulated its marketing on Low Cost Focusing (Porter 1985). This is a good proposition and of course price matters in today’s time. However this offer is valid only in Europe and doe not give added value to the travel experience unlike BA’s product. 2.4 product stage in the product lifecycle As per Levitt (1965), the product is in the maturity stage currently mainly because of the credit crunch as people have cut down on holidays. This promotion as per Holloway (2004) is an attempt to make people travel more. Also, due to the credit crunch, as Frampton (2007) explains, people choose cheaper destinations like the Fareast thus this promotion is aimed at cities that are not that cheap as travel destinations and where holidaying has decreased substantially. However, the promotion might put it back into the growth stage because it adds convenience and those who avoid holidaying because of excessive planning may revert back to such holidays (Kotler 2000). 2.5 product strengths The main product strength as per Porter (1985), that appears in the advertisement is firstly the brand British Airways itself which is the leading airline of UK. In times of credit crunch, people have cut down on travelling. Those who are doing so want the best prices not only of the ticket but also of accommodation and rented cars etc. At the same time since the target market is not familiar with the destination, the product offering is adding convenience to the whole experience of travelling which according to Bacon (2004) the consumers desire and appreciate especially while travelling. Thus the product has good strength and may prove valuable to the customers. Also, there are several destinations the consumer can choose from and it is not restricted and at the same time he has the liberty to choose from a variety of hotels. Thus the whole product proposition gives the product added value and it is something that the customers may switch their brands for (Bacon 2004). 2.6 unique selling proposition The unique selling proposition of the product is that it allows the customer to “design your trip as you like it”. Such a unique feature for selling is important according to Porter’s( 1985) Competitive Advantage Framework and Focus strategies, the product not only gives the customer rebated rates on the ticket it allows them to also choose their hotels from a range of 4000 hotels which would suit their budgets and preferences. At the same time, the product also enables them to get rented cars which the competitors do not offer. Since British Airways is a big name, it also has connections with hotels etc which it is availing. This unique selling proposition according to Reeves (1961) is something that the competitors cannot match easily as they may not be as connected as BA. 2.7 product positioning The product has been positioned as a value for money product targeting the upper middle and middle class category. As per Doganis (2001) the product is not upscale and appears to be a smart deal and a lot of convenience which is required in such an economic scenario. 3 Advertising Campaign, Medium and Communication of Message 3.1 advertisement display and environment The advertisement of British Airways was observed in XYZ newspaper on the ….of . The newspaper is distributed widely and is Britain’s leading newspapers. Shaw (1999, pp. 12-27) explains that the placement of the advertisement is important as it will determine how target audience perceives it and react to it. Thus the attractiveness factor plays a pivotal role. 3.1.1 Size of advertisement The advertisement is a quarter page ad in the newspaper. The actual size of the advertisement is 20cm by three columns. This is a good size and attracts readership as Shaw (2007) explains. 3.1.2 Location of ad and surroundings Doganis (2001) details that the location of the advertisement matters, and this advertisement however, is not attractive as it is placed amidst articles and other advertisements that are much more visually colorful and attractive. Thus the advertisement of British Airways seems dull by comparison and is not attractive to the eye. Also, since the target audience is vacationers, the placement is not appropriate as the surrounding articles are not of their interest and chances are that they may not spend as much time on the page (Shaw, 2002, pp.50-58). 3.1.3 Color, size and font Though the advertisement is in four colors, the colors used are very dull. Black and hues of brown make the whole advertisement dull and unattractive. Additionally Morgan and Pritchard (2001, pp.150-161) the font is not legible and the in text boxes are also black which don’t attract attention. 3.1.4 Visual image The overall visual image is not appealing and thus according to Shaw, S (1999, pp.20-29) does not convey the message appropriately. The caption “city breaks” does not indicate that it’s an advert of an airline. The advertisement seems to be broken down in two sections and seems disjointed. The images are in the backdrop and the text is not connected with the images. Also, there is an image of Empire State Building and a hazy image of a man which doesn’t make sense and is neither appealing. The visual does not indicate that it’s an advertisement of British Airways. 3.2 intended target audience The intended target audiences of the advertisement are those going on a holiday. They have mentioned that “you can do what you want…who said you had to come back” shows that the promotion is for those who are planning a trip to places like Hong Kong, Cairo, New York, Miami etc. and are wishing to go for a holiday. Even the price promotions are valid in the holiday season. At the same time, those customers who want value for money and are price conscious have been targeted through this advertisement. These may include young people traveling single or couples or even with family etc. who read this newspaper. 3.3 marketing aims of the campaign The marketing aims of this campaign are to attract the target audience by offering value for money which as Kotler (2000) elucidates could be a competitive edge also. This is because the airline is offering to arrange for hotels and limousine within the mentioned rates. The offer is valid for the holiday season and offering a several services in a package offering convenience to their target market. This also will give reliability of hotel and car bookings which is what the customers in a new city need. 3.4 Message communication and effectiveness to consumers The marketing campaign is good however; Ferrel (2005) explained the AIDA model which shows that the message has not been communicated well to the target audience. The message could have been more focused and be more explicit visually and textually. The reader cannot understand which cities is the airline flying from as it is not clearly written. Thus the reader will be confused and the message is not that effective. Analyzing the results with Belch’s DAGMAR model (2004), the images are misleading also and do not have a ‘catch line’ that would help recall to the reader at the time of purchase. Also, the advertisement has nothing to say visually, it is only when they start reading can the message be understood. The text in the message is written well however, it has not been presented well. Moreover, the text towards the end of the advertisement is confusing regarding the validity of the offer and is misleading which will further confuse the reader (Middleton, 1994). 4 Advertising Media, Public Relations, Personal Selling 4.1 potential of alternative media Shaw (2007) confirms that a magazine advertisement is a better alternative than a newspaper advertisement in the airline industry today. This is because firstly a magazine advertisement is cheaper than a newspaper advertisement. In times of economic downturns, advertising budgets have shrunk and spending should be tailored and focusing only on the target market. Thus spending on newspaper advertisements means spending unnecessarily. Bacon (2004) defends that magazines are targeted and customized and may affect the target market more. Magazines like travel magazines, business magazines, women and men magazines are good options to target the niche. At the same time, agrees Holloway (2004) magazines have a longer life than newspapers. An advertisement may be viewed just once in a newspaper as it is read just once by an average reader however, a magazine may be weekly, bimonthly or monthly etc which means that the advertisement may be viewed more often in the same magazine bringing value for money for the client. additionally, Prideaux (2001, pp 213-227)points out that the client will know where the magazines are being distributed and will have more control of which target market it will reach and where. The magazine may reach a certain region or a city etc and thus the cost would depend on that. On the other hand, argues Holloway (2004) newspapers have a nationwide reach and thus will reach readers who are not interested in travelling etc.whihc simply add to the cost. In a magazine explains Bacon(2004), the demographics of the reader is known thus the advertisement that are placed in the magazine can be customized according to the reader and thus it will appear much more appealing to the reader than an advertisement in a newspaper advertisement. 4.2 campaign enhancement using PR As Shaw (1999, pp20-28), public relationship is an important tool and will enhance the image of the product. This is because it will help in developing relations between the firm and the public. Kotler (2000) adds that practicing corporate social responsibilities, press advertisements about the firm and its CSR activities, holding events where important personalities and prospective clients are invited, sponsoring social causes etc or fund raisers like galas etc will facilitate in building the image of the firm. However, Holloway (2004) points out the PR strategies should be coordinated with the marketing strategies to make a bigger impact on the consumers as it will enhance the overall image and help in making the campaign a success. For instance, inviting customers to a social event which has been sponsored by the airline at the time of the current marketing activity of British Airways just before the summer holidays, will ensure that it builds a positive image of the airline in the eyes of the customers as they would consider the airline as being socially responsible will believe the claims of the product that it is a value for money proposition with added convenience. 4.3 role of personal selling Morgan and Pritchard (2001, pp. 150-166) clarify that personal selling may be important to reach those people who have not read the advertisement or serve as a reminder who have come across the advertisement. This promotion that the client is running can be reinforced by personal selling via the staff as according to Shaw (2002, 49-60) with personal selling the staff can have direct interaction with the customers through “Direct marketing” which may help in resolving any queries or problems the customer had. He may understand the offerings better and may be inclined towards the product. Kotler (2000) adds that the staff may also help in explaining the competitive advantage in detail and thus may be able to win the potential customer. Morgan and Pritchard (2001, pp. 150-166) explain that personal selling may be conducted via telephone (telemarketing) or even personal visits. Telephone personal selling, according to Shaw (2002, 49-60) will have a wider reach and thus personal selling may be conducted just before the season starts and inform them of the benefits of the new promotions. At the same time, offers Kotler (2000), customers who appreciate personal visits may be visited and thus this may enable the customers to be more familiar with the product and at the same time personal selling may convince them of the offering. Personal selling may be conducted on existing customers to be more effective and productive (Holloway 2004). Though it should be within the same months as the product validity and should be conducted on those planning holidays or those who went on a holiday the same time in the last three to five years. 5 Distribution Channels, Sales Support, ICT 5.1 scope of alternative distribution channel 5.1.1 Internet selling and sales support Information technology is an essential tool and today it is integrated into everyone’s life. Businesses are being increasingly dependent upon it and using it as a means to selling products is a lucrative idea (Bacon, 2004, pp.35-40). The airline can sell its products through its online services via its website. This will allow the airline to market its products, services and new offerings to a global market as the reach will be wider. Prideaux (2001,pp. 213-227)adds that such an alternative mode of selling will curtail costs of advertisements and at the same time since the firm is selling directly to the customers the travel agents will not be involved to a large extent. However, argues Shaw, (2002) the website should be user friendly or else the customer may be lost. There are also security issues of using a credit card that are involved. For such a distribution, a technical sales staff is needed. Firstly a call center is needed where the customer can call and resolve their queries these sales people have to be trained and well informed about any related query the customers may have. Also, adds (Bacon, 2004, pp.35-40) the website has to be interactive and responses of the emails of the customers have to be answered immediately. 5.1.2 Kiosks and sales support Another mode of distribution may be placing kiosks of the airline at prominent places like malls, hotels and the airport so that the products may be sold directly to the customers (Morgan and Pritchard 2001). However, argues Kotler (2000), in such a method, the mass market may not be reached like in a website. To be able to execute this, Prideaux (2001) explains that several sales personnel are required. They will be placed in the kiosks and they should have good interpersonal skills and knowledge about the product and services and at the same time the required technical skills. 5.2 importance of ICT 5.2.1 Internet Vargo and Robert (2004) detail that Information and communication technology can play a crucial role in the next five years. Prideaux (2001, pp. 213-227) explains that the main advantage of the information technology is that it facilitates a two-way communication between the client and the customer and not just one way unlike the traditional media. Information technology will overcome the problem of distance and businesses will be easily carried out via the internet and thus winning global customers and helping building a relationship with them. According to Frampton (2007) the IT systems that enable the airline to maintain detailed information about the customers can be used to make niche markets and initiate focused marketing. At the same time, the internet can help direct interaction with the customer and the client thereby building personal relations with the customers. Email Marketing, texting and customer support systems can enhance the relationships between the customers and the client (Vargo and Robert 2004). All selling points of the client should be interconnected with sophisticated software so that they may know about the likes and dislikes of the consumers which may help in modifying the services. 5.2.2 RFID technology At the same time, RFID technology may be used to record every purchase movement the customer makes so that he may be better understood and thus it would enhance his relations with the brand (Vargo and Robert 2004). This would make customers more loyal thereby increasing sales. At the same time, according to Shaw (2007), Analytical CRM can be used to enhance customer-brand relationship whereby the data of consumers can be stored in systematic way so that it may be processed further and be used for marketing. 5.2.3 Mobile phones Mobile phones as Holloway (2004, 263-280) points out can also be used as a tool for advertisements and updating the consumers about the latest offerings etc. it can also be a means of enabling the consumer to interact with the brand. The information can be customized and unnecessary information can be avoided which will make the customer feel closer to the brand. 5.2.4 Call centers Call centers are another means of information technology which will help in building the brand-customer relations (Shaw 2007). By helping resolve the problems that the customer is facing in a timely fashion, the customer will learn to rely on the brand more often and thus trust the brand more thereby building a two-way relationship. 6 Market research Older passengers are a niche that the airline should improve. However, to do so, the reasons why these customers use or don’t use the services of this airline should be known. The problems that they face should be understood and then only can the improvements in the services be made. 6.1 Conducting the research The firm should conduct a research on those passengers who fit this category (Bush and Burns 2006). As per Creswell (2003) the firm should seek the help of their marketing staff to conduct the research headed by the marketing manager. However, if the marketing department is not equipped enough, the research can be conducted by hiring a seasoned Research Firm, which may include Research Pioneers, Market Researchers and MKT Researchers. To select the subjects, as suggested by Bush and Burns (2006), the database of customers can be filtered and those passengers who have used the airline at least twice and at the same time who have crossed a certain age bracket should be selected. The subjects should be from different parts of the country and at least 1500 customers as this would make the research more reliable. 6.2 Method of research and place Since the subjects are not mobile and it would be difficult for them to come to a particular venue, Bryman & Bell (2003) affirm that the focus groups will not be an appropriate option. The ideal option would be the questionnaire method. As suggested by Creswell (2003), the questionnaire should be short with mostly multiple choice questions and with some open ended questions. The language should be simple and easy to understand. The best place to find the subjects is at the airports. The researchers should be placed at the airports with questionnaires. This, according to Bryman & Bell (2003) will allow the researcher to spot the subjects based on their age and immobility. The researcher should firstly explain to them the reason for conducting such a research. At the same time, Malhotra and Birk (2000) point out that he may volunteer to write out their responses for them as they may not be able to do so themselves. The airport is a good place to conduct the survey as the subjects would be in the premises of the airport and will immediately be able to tell what problems they may be facing. Bryman & Bell (2003) point out that the option of direct mailing will enable a better reach of subjects and a larger number of people may be covered however, Malhotra and Birk (2000) argue that the risks of direct mailing may be that they may not bother to return the questionnaire. Moreover, as advocated by Creswell (2003), to make the research more reliable, a parallel research should also be conducted who will be interviewed using a telephone survey. However, Bush and Burns (2006) point out that the number of subjects in this research should be reduced as the interview method will be more time consuming and thus may not permit coving the same number of subjects. The interview method will give them a chance to give elaborate responses. A better understanding of the problems may be reached. However, counters Creswell (2003), the interviewees have to be patient and forbearing as the subjects may be short of hearing, may not easily understand the reason for the research and may also ask several irrelevant questions. The main purpose of this method is to include those subjects who are immobile and travel very rarely. They might not be spotted at the airport as often therefore a telephone survey using the database for reaching the subjects will be a better option. 6.3 Time of research. The research should be conducted ideally in the holiday season when more people are travelling. The research should be conducted during the day as elderly people may like to travel during the day rather than at night. At the same time, Creswell (2003) suggests that the telephone research should be conducted during the day also as most elderly people sleep early and may not appreciate researches conducted in the evening. They may also have more time during the day as most may not be working (Bush and Burns 2006). 7 conclusion and recommendations 7.1 Conclusion Though the product of British Airways is good and has a unique selling proposition along with product strengths, its promotion is not done appropriately. Firstly Shaw, (2002) explains that in times of a credit crunch, instead of using focused media for promotions, they are using newspapers. Instead they should use targeted magazines etc to cut costs and at the same time reach the required target. According to Morgan and Pritchard (2001, pp.150-161) the overall image, font, color and attractiveness of the advertisement is not attractive and will not win customers even with a better product than competitors who may not be having a better product but their advertisements are appealing and have been placed well in the newspapers. The product is targeting a saturated niche and is an attempt to increase holidaying. However, the product is adding convenience to the travelling experience with the offer of designing their own travel which is a good offer. Thought the client should use magazines for advertisements, it should also enhance sales by using personal selling and PR simultaneously to increase the effectiveness of the whole campaign. At the same time, adds Prideaux (2001) new distribution channels like the internet and kiosks should be used and emphasis should be made on ICT like mobiles and call centers along with the internet making it an essential marketing tool. Lastly, new market niches should be located and catered to like the old age people and the firm should build their CSR image by improving their services by adding convenience to the travel experience to older customers. 7.2 Recommendations 7.2.1 Improving the campaign British Airways should improve on the existing advertisement by including lively and exciting graphics. The colors should be brighter and as the target market is someone seeking excitement and fun travelling. The colors should match the mood of the customer. It should include a grasping catch phrase that emphasizes on the rebated prices and the value addition of convenience and comfort. People should be featured in the ad so that there may be direct association. The text should be minimum and the graphics should explain the concept. Overall the visual should be more cheerful and happening. 7.2.2 Cost effectiveness The firm should minimize costs and using newspapers is a waste. Instead the firm should focus on mediums that are effective and cheaper. The medium used should be magazines and flyers instead of a mass media like newspapers. Cable advertisements can also be targeted. The target segment is very focused and it is pointless to use the mass media. 7.2.3 PR and Personal selling During the time of this promotion, PR activities along with personal selling should be used as it will make a better impact and help build recall and a good image of the product and the firm. 7.2.4 Integrated marketing communication There should be customized marketing i.e. in accordance with the particular customer. Emailing and direct mail etc should also be used that encourages two-way communication to build brand loyalty. The customer-firm relationship should be built so that there is trust and reliability along with preference. This can then act as a competitive advantage and a USP. 7.2.5 Unique selling proposition The USP of this product can be competed away thus the firm should find a USP that will last long and draw more customers. 7.2.6 Find other niche This is a saturated niche; the firm should concentrate on new markets. Teenagers and kids could be the focus as they require travelling via their school etc. 7.2.7 Corporate social responsibility The firm should take CSR initiatives to build the overall firm’s value. This will make the products sell better and help the customers trust the brand. References Dwyer, F, Robert, S, and Sejo, O 1987, "Developing Buyer-Seller Relationships," Journal of Marketing, 51 (2), pp.11-27. Vargo, S. and Robert, L 2004, "Evolving to a New Dominant Logic for Marketing," Journal of Marketing, 68 (1), pp.1-17. Frampton, N 2007, ‘Changing the image of public transport through marketing’, Chartered Institute of Logistics and Transport FOCUS, October, pp. 15-18. 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