Comparison of Marketing Strategies - Essay Example

? Comparison of Marketing Strategies of the Table of Contents Table of Contents 2 Overview of the Company 3 Service marketingmix for British Airways in UK’s and USA’s perspective 3 Product 4 Pricing 5 Promotion 6 Place 8 People 8 Process 9 Physical Evidence 9 Conclusion 10 Overview of the Company British Airways is located in Waterside, close to London Heathrow Airport in UK. It is renowned for being the flag carrier air service company of United Kingdom. The company is the biggest airline in the country on the basis of the fleet size, the total number of flights in the international land, the international destinations etc. British Airways is the second largest among all the airline companies on the basis of the total number of travellers carried. British Airways Board was formed in 1971 for controlling two big domestic airline companies, BEA and BOAC and also two small airline companies, Northeast Airlines and Cambrian Airways. On 31st March 1974, all the four companies merged and British Airways was formed. The company started expanding its operations by the acquisition of British Caledonian (in 1987) and Dan Air (in 1992). The company also formed strategic alliance with Cathay Pacific, Qantas, American Airlines and Canadian Airlines. The alliance is counted as the third largest alliance, next to Star Alliance and Sky Team. British Airways is a subsidiary of International Airlines Group, which has been listed in London Stock Exchange and FTSE 100 Index. The loyalty of the employees as well as the former colleagues along with the collection of beautiful arts has helped British Airways to gain competitive advantage over its competitors. As already mentioned, the company is a merger of the four companies BEA, BOAC, the North East Airlines and Cambrian Airways. The current alliance with the Qantas, Cathay Pacific, American Airlines and Canadian Airlines has made British Airways the third largest alliance. It is presently providing services in 150 different countries out of which six are located in the domestic land. British Airways is amongst the top premium airlines of the world. World Cargo, the subsidiary of the British Airways, is the twelfth largest airline of the whole world based on the tonne fright kilometres travelled. BA CityFlyer, a fully owned subsidiary of British Airways provides services to twenty different destinations in Europe. Although the main focus is given on the financial markets by the company, it has recently extended the operations and achieved a remarkable position in the leisure market. There are many other services provided by the company like car rental service, hotel service etc. The excellent services provided by the company in both international as well as domestic land have helped it to achieve a successful position in the market. Service marketing mix for British Airways in UK’s and USA’s perspective 7P’s of marketing gives set of policies related to the product, price, promotion, place, physical evidence, process and people which generally affects the purchasing decision of the customers. These policies are set by the management. The success of a business involves a long process where achieving success depends on the marketing; the success related to marketing depends on the marketing strategies and finally the marketing strategies deal with the elements of 7P’s of marketing. Thus the implementation of appropriate strategies in 7P’s of marketing is very important for the achievement of success by a business enterprise. A service marketing mix is the mix of the marketing plans of the company (Belohlavek, 2008). Product The product or service strategy of a company should be such that it gains the attraction of the customers easily. The product or service strategy should be planned in such a manner that it provides satisfaction to the needs of the customers and have a differential advantage over the product offerings by the competitors (Hobbs, 2011; Masterson & Pickton, 2010). British Airways provides quality services to its passengers by providing them premium cabins and various other facilities. In UK, it is the biggest airline on the basis of the number of international fights and also the international destinations. The product strategy of the company is to provide quality services to the passengers. The company provides services like business class service, executive class service, security and various support facilities. The company is known for its excellent services to the passengers. British Airways is the leading company among all the airlines in United Kingdom. The company modifies its products and services with time in order to adapt to the changes in the passenger preferences. The company plans its service strategy in favour of the general masses, from the economy to business class. There are some special services provided like free food & beverages, Entertainment sources like radio, magazines etc. The customers can buy the tickets according to their budget and requirements. The company has different classes including the elite, middle, upper middle and business class. The passengers can choose for their own respective option by means of online services provided by the company. In United States the customers have been given the facility of some special services. In case of any inconvenience (For example- inconvenience arising due to the weather problem, airport operating issues etc) the passengers have been promised by the management that they will minimize the problem related to the delays. The passengers can cancel the reservation and the full amount of money will be refunded by the company. The passengers are provided services for their essential needs such as food, water, any medical facility (if required), restroom facilities etc in case of extraordinary delays. All the airport teams of the British Airways have an operational contingency strategy in order to address to the needs of the passengers. Pricing Price is an important element of the service marketing mix as the pricing strategy always has an effect on the sales, demand, its competitive strength and finally the profit (Czinkota & Ronkainen, 2007). The effect of a wrong pricing decision cause harm to the efficiency related to other functional areas. Thus the pricing strategy should be planned very carefully. Some of the pricing objectives that should be taken into consideration while planning for the pricing strategy are profit maximization, improvement of the condition of market share, price stability, coping up with the level of competition in the market etc. Price is actually the exchange value for the products or services provided in respect of money. In United Kingdom, British Airways has made the pricing strategy in such a manner that it is affordable for the customers. The customers can choose their seats according to the individual choices and budgets. Thus the customers select the seats in compatibility with the requirements. There are three types of strategies followed by the company while setting the prices: The premium strategy This strategy is implemented mainly for the business and the executive class users where the services are available to the customers at premium prices as a return of the high quality services. This strategy has been set by the company in order to prove that it offers better services to the business class as compared to the competitors in the industry as there is a perception among the customers, especially in the higher section of the society, that the premium price offering services have high quality. The medium pricing strategy It is a pricing strategy set between the premium pricing and the lowest pricing. It is implemented for the economy class users. The economy strategy This pricing strategy has been set to provide some basic services having additional benefit which will add additional value to the company’s brand. Promotional pricing British Airways has fixed some prices for performing promotional activities on Flights. The company provides promotional offers during various occasions which attract the customers. Moreover, the domestic fares have low prices which allow people to travel long distance at cheaper prices comparatively. In case of United States, the pricing strategy is almost the same, excepting the fact that there is lowest fair availability by the company to the passengers. The customers who call for making reservations in order to purchase the ticket for a particular day or a specific time are offered with the lowest possible fairs by the company. In case if the specific day or time is not provided, then price range will be provided to the passengers. However the range has been set by the company in a manner that it is easily affordable by the passengers. Promotion Promotion is the effort made by the company in order to stimulate the demand of the product in the market without making any change in the pricing strategy, the product mix and the channel of distribution. It involves efforts made by the marketer to provide information to the buyers and persuade them to buy the products (Kumar, n.d.). The major importance in the promotional activity is given to persuasive communication. The promotional objectives that are taken into consideration while planning for a promotional strategy are stimulating the demand of the products, informing the customers and market intermediaries, making the other elements of the service marketing mix more meaningful. The set of elements present in service marketing mix are advertising, sales promotion, personal selling, publicity and direct marketing. Promotional mix of British Airways There are number of promotional strategies implemented by the company. Sales promotion Sales promotion is any type of activity offering short term incentive for increasing the purchase (Paul, 2008). British Airways is one of the leading carriers operating for more than 90 years. Presently, the company is flying over 300 different destinations across the world. Some of the special offers made by the company in UK include exemption of the check in fees of luggage and online check, car rentals and hotels to the passengers, several competitions like winning a holiday, free gifts etc. In United States, the sales promotion activities performed are refunding of the money in case of any cancellation of reservation by the passengers, providing special food offerings to the customers in flights on various occasions etc. There are other services offered to the passengers on flights which provide satisfaction to them. Advertising Advertising is the best medium for communicating with the customers and acts as one of the most important elements of promotional mix (Tyagi & Kumar, 2004). Presently, it has become very difficult for the marketers to reach to the right people whose needs will match with the product offered by them. In this situation, advertising through different media acts as an effective way to reach the services or the products to the right people at right time. There are wide ranges of media available including magazines, newspapers, TV, Radio and finally Internet. Individuals become aware of the products or services offered by any company only when they get the knowledge. Advertisements play an important role in capturing the attention of the people by providing them information about the products and services being offered by the company. In UK, British Airways uses more than 30 tools for the purpose of advertising. Some of them are TV, audio advertisements, direct mail, magazines, airport and airport and onboard media. In addition to this, there are also other online websites like the magazine websites, Metro-Twin website (a social network media) for promoting the service offerings of the company as internet is one of the best way for delivering the message of the customers (Baker, 2012). Thus, these tools act as important mode of communication with the customers influencing them to take the services from the company (Tuten, 2008). In United States, the promotion of the service product of British airways by means of advertising is the same. The company uses the online sources in an effective manner to provide the customers with the necessary information about the services offered by the company so that they get attracted to the service offerings made by the company. In this country, the people take decisions based on the visibility satisfaction. So the attractiveness of the online websites of the company can gain the attention of the customers easily. Direct marketing Direct marketing is the approach made by the organization directly to the people (Nash, 2000). Direct mails, use of telephone etc are some of the methods of direct marketing. This mode of promotion has become very popular as it becomes very easy to convey the information to each receiver and judge the response that has been gained through that communication. British Airways is renowned for the esteemed services it provides to its customers. In UK, the customers of British Airways have the opportunity to sign up for the purpose of direct marketing by registering on the company’s website or by joining the executive club. The cell phone users will be provided with the opportunity to get detailed information about the special offers by means of text message alerts. The company will also ensure that no duplicate calls or unauthorized messages received by the customers. In United States, British Airways performs the same activities of direct marketing. Personal Selling Personal selling is a trend of promoting the product or services to the customers by direct interaction with them either by telephone or one to one (Anderson and Dubinsky, 2004; Lamb, Hair & McDaniel, 2011; Havaldar, 2005). The sellers here have the opportunity to promote the products through their quality of interaction, attitude and knowledge about the products. British airlines being a busy air service company cannot provide services to the customers by interacting with them personally. However the company has designed its services in very comprehensive manner so that the customers can opt for its services at the time of selling. Place Place determines that where the service product is located. The buying decision of the customers is normally influenced by the effectiveness with which the service product can be placed in the market. It is the availability of the product (Worsam, 2003). British Airways has always been successful in making its presence in the top global cities by direct operations or entering into partnership with many other airline companies. The company operates from the United Kingdom and also has its operational base in the country for carrying out the regular activities. The company operates through different airports in order to carry out its business operations. In United States, the company provides international services to the passengers. The company has different attractive offerings for the passengers travelling from USA to Europe. The company operates through various airports in this country also. People It is an important element of the service marketing mix. It is the element responsible for defining a service (Sahay and Sharma, 2009). In an organization, the people have the power to build or break an organization. They are responsible for attracting the customers, providing them satisfaction and finally retaining them. In case of British Airways the employees are the most important factor responsible for the achievement of success by the company. It is their effort along with the quality of service product that has enabled the company to distinguish itself from its competitors in the airline industry. In case of UK, this element of service marketing mix acquire less importance as the passengers are mainly concerned about the quality of the services offered to them. In case of United States, this element is an important factor to increase the customer reliability on the company as they rely on the visibility (For example- the behaviour of the employees towards the passengers while providing services.) Process A company should first try to understand the needs and demands of the customers. This will enable the company to understand the exact product or service requirement. Analysing the market and then the competition in that market helps the company to plan for a strategy in order to achieve competitive advantage over the competitors. Service process is the procedure by which the service is delivered to the end user. In case of an airline, this element involves reservation, flight information, facilities provided at the airport, baggage handling, flight entertainment, quality services etc. In case of United Kingdom, British airways perform all the activities mentioned above to complete its service process with excellent quality so that the passengers get satisfied. In case of United States, although the company provides quality services but there have been some problems related to the flight delays which are providing inconvenience to the customers. The company is taking important measures to minimize the occurrence of this problem. Physical Evidence This is the last element of the service marketing mix. In case of airline companies, the physical evidence includes ticket counters or the booking offices, brand etc on the ground and aircraft, seating configurations, good inner exteriors, cleanliness etc in the flights. United Kingdom is having less diversification and as a result the arts and architects used in the aircrafts or in the airports are very traditional which provides visibility satisfaction to the passengers of the country. In case of United States, the British Airways provides contemporary mode of art and architecture to create an ambience providing comfort and satisfaction to the passengers. Conclusion British Airways is one of the leading airlines providing services to most of the top global cities in the world. It is evident from the above discussion that the company has set different marketing strategies in two different countries. The difference in the marketing strategies of the two countries set by the same company shows the difference in their environment, the culture of the people of the two countries etc. The people of United Kingdom are traditional and prefer traditional methods of services being provided by the company. The people of United States do not believe in traditional concepts much and as a result prefer contemporary methods of services being offered to them. Thus the choice of the people is one of the reasons responsible for the difference between the marketing strategies of the two countries. In United States, the low fair availability by the company provides satisfaction to the customers. This is an extra advantage provided to the people of United States as compared to that of the people of United Kingdom. But British Airways has some recent problems related to the flight delays in United States. This inconvenience can decrease the customer’s level of satisfaction to some extent. The company should try to analyse the market properly, in both the countries and then plan for the appropriate service mix for both the countries. References Anderson, R. E. & Dubinsky, A. J. (2004). Personal selling: achieving customer satisfaction and loyalty. Boston: Houghton Mifflin. Baker, M. (2012). The Marketing Book. London: Routledge. Belohlavek, P. (2008). Unicist Marketing Mix. Houston: Blue Eagle Group. Czinkota, M. R. & Ronkainen, I. A. (2007). International Marketing. Connecticut: Cengage Learning. Havaldar, K. K. (2005). Industrial Marketing: Text and Cases. New Delhi: Tata McGraw-Hill Education. Hobbs, D. P. (2011). Applied Lean Business Transformation: A Complete Project Management Approach. Newcastle: J. Ross Publishing. Kumar, (n.d.). Mktg Of Hospitality & Tourism Serv. New York: Tata McGraw-Hill Education. Lamb, C. W., Hair, J. F. & McDaniel C. D. (2011). Essentials of Marketing. Connecticut: Cengage Learning. Masterson, R. & Pickton, D. (2010). 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