International Service Marketing - Essay Example

International Service Marketing Introduction In the current era, the extent of communication between nations has significantly increased. This has helped to enhance prosperity of the airline industry. Presently, the industry is characterized with high degree of competition and relatively lower profit margins. Though economic surplus generation is relatively low for the firms in this industry, yet it should be noted that fixed costs in business for these firms are very high. At this juncture, the heart of value creation of a single firm in this industry lies in effectiveness of its marketing activities. Figure 1: Importance of Service in Business (Source: Shaughnessy, 2013) The above flowchart shows a service profit chain that is encountered by each and every firm in the contemporary world. So, it can be claimed that higher profit generation can be experienced by firms only with the essence of superior quality of service. This is the era of consumerism and level of utility derived by the consumers from services of a company determines their loyalty towards the same in the long run. This essay tries to implicitly analyze the service quality of British Airways (BA). It is believed by scholars that a company’s service quality invariably undergoes four progressive transitional stages across its life cycle. These stages are Service Losers, Service Nonentities, Service Professionals and Service Leaders. The context of essay will estimate the most appropriate service quality stage, where the selected service of BA lies. In latter half of the essay, the selected service quality of BA will be precisely compared with that of other competitors in the market. Finally, recommendations will be also provided, whereby the company would be able to rectify certain existing limitations of the concerned service (Shaughnessy, 2013). Advantages of the Catering Service The company of BA claims to have substantially improved the quality of its food and wine service. The company states that customers can experience better quality of food and drink on its flights in comparison to many popular food junctions on the ground. The food offerings are claimed to be prepared freshly on the flights itself. The on-board catering service of the company is distinguished in terms of the flight seat classes. The major dinning types offered by the company are economy dining, premium economy dining, business dining, first dining and special meals (British Airways, 2014). Under the menu of economy dinning, BA offers complementary snack or meal services to all flight boarders. Bar services are also provided by the company to all customers. The bar service of the airline serves assorted drinks to the passengers. The airline also claims that all its food products served are prepared from locally sourced ingredients. At the same time, the food and drink served are extremely fresh and healthy. The company also foregrounds that its food suppliers are extremely trustworthy and hence, never serve rotten or long preserved food items for the customers. Figure 2: Basic Economy Dinning BA (Source: British Airways, 2014) The airline offers food to customers suitable for all meal timings. It might be lunch, dinner, breakfast, evening snacks or mid-flight snack meals. Hence, customers get food on all fights of the company in different time and durations. The Euro flights of the company are scheduled for very short duration. Even then, consumers get access to various types of drinks and snacks food in the same. There are several unique advantages of the premium economy dining offered by the company. The food and drink served under this type of dinning is provided to customers, only after considering factors relating to seasonality and locations. For instance, flights of the company travelling along routes of Africa and Asia serve local dishes to the flight boarders (British Airways, 2014). Nevertheless, The World Traveller Plus menu of the company (premium economy dinning) charges separately on the food served to customers; but the bar facility under this type of dinning is complementarily available to customers. Especially the customers who fly from London on flights of the airline enjoy special added benefits compared to other flights. The main course food supplied to customers of the airline on London flights are prepared by leading chefs and are at par with quality of food served in the business class cabins. The flights of the company constitute special Club Kitchens. Special deserts in form of ice-creams, fruits or wraps are available to business class customers from the Club Kitchens (British Airways, 2014). Figure 3: BA Club Kitchen Stock (Source: British Airways, 2014) Apart from the business and economy dinning menus, the airline also serves customized food and drinks through its first dinning offers. Under the first dinning menu, BA serves the most delicious British dishes to the rich customers. Furthermore, if any boarder desires to consume light food, this dinning department provides a special Bristo service, which includes salads, pastas and sandwiches (British Airways, 2014). Figure 4: Classic English breakfast Served by BA (Source: British Airways, 2014) The above picture presents the superior high quality classic English breakfast served by BA. Moreover, Express breakfast service of the airline serves breakfast closer to the landing time of fights. This helps to maximize sleeping periods of the passengers (British Airways, 2014). Figure 5: Classic Afternoon Tea served by BA (Source: British Airways, 2014) The above picture shows the well-garnished, classic afternoon tea service provided by BA; this is a British tradition since 1830. Additionally, in London Heathrow T5 and New York JFK, there are Concorde dining rooms of the company, where passengers of the airline can have food, drinks and rest before boarding flights (British Airways, 2014). There are even Special Meals services provided by the airline. These meals are highly customized according to dietary requirements of specific passengers. The instructions for such meals are provided by customers before boarding the flight through Manage My Booking site of the company. There are great diversities in such special meals; some are shown in the table below. Figure 6: Special Meal Types (Source: British Airways, 2014) So, the above analysis points out that, primary advantages that are entailed by every economy dining offered by BA are related to its food and drink, variations, quality and availability (British Airways, 2014). Limitations of the Catering Service From the above analysis, it can be stated that on-board catering services of BA have several vantages and substantially helps to enhance brand value of the firm in the market. However, in reality, there are certain negativities or limitations to these services. The company does not guarantee that food and drinks served on its flights are free from allergies. It clearly states that certain specific allergen products are used in the food menus served by the airline. Such products are peanuts, tree nuts, dairy products, seafood and Gluten. Since the economy dining is complimentarily offered to all customers, quality standards are often found to be highly volatile in separate flights of the airline (Rivera-Vazquez, Ortiz-Fournier and Flores, 2009). At the same time, food and drink variations are often not available in reality as mentioned in all flights of the company (Teacher, 2009). As prices of the tickets offered by the airline varies in terms of flight classes, quality of on-board catering service provided also significantly differs according to the ticket prices. Therefore, food and drink available to business class customers of the company are much superior to that of the economy classes. Furthermore, the airline’s catering services are slightly biased towards British customers. Since the company is a multinational firm, revenue is generated on basis of global sales; thus, such discrepancies made by the firm are irrational for its retail growth (Tran, 2005). Competitor Analysis The company at present is highly threatened by strong rivals in the industry. The potential competitors of BA are Ryanair, Air France, Lufthansa, Easy Jet and many more. The on-board catering services provided by these firms are often equal or perhaps better than that of BA. Figure 7: Competition of BA (Source: White, 2012) The above bar graph data shows that companies like, easyJet and Virgin Atlantic, lead the airline industry in western nations. All the above-mentioned airline companies are strong competitors of BA. In terms of catering services, BA lies way above easyJet. The company of easyJet is a low cost airline and customers prefer it over BA owing to less pricy tickets and not superior catering services (EasyJet, 2014). However, the company lacks in terms of catering service, when compared with the same service provided by Lufthansa Group (LSG) (Lufthansa Group, 2014). It should be noted that the world’s best catering services are provided by the latter. LSG Sky Chefs prepare food and drink menus with strategic orientation due to increased competition in the airline catering industry and soaring cost pressures on the operating firms, since the economic downturn. The catering department of LSG employs 32307 workers and earns higher revenue compared to that of BA (Lufthansa Group, 2014). Service Performance Analysis Considering the privileges of on-board catering service provided by BA, the following context of the essay will make a rigorous analysis of the catering service quality of BA. It should be noted that quality of services provided by a firm lies at a loser, nonentity, professional or loader stage. It is feasible to consider that service quality of on-board catering of BA is at the Service Professional Stage. Service Losers From the above context, it can be observed that there are numerous superiorities and advantages of catering services offered by BA. Hence, quality of this service cannot be assumed as poor in terms of both customers and managerial perspectives. The airline industry is extensively competitive and if BA provided an unworthy on-board catering service, then customers could easily switch to some other airlines. Nonetheless, the growing revenue and customer base since the last few years indicates that the company is not a service loser, in terms of catering service (British Airways, 2009). Service Nonentities The catering services of BA are highly modern in nature. Hence, the service is not dominated by traditional and primitive operational mindset. The firm has a long learning curve and high brand recognition in the market with the essence of sophisticated marketing strategies. Thus, consumers often avail the services of the company by rejecting opportunities of boarding flights of the rival firms. Since BA is one of the leading players in the industry, it can claim to be a prominent entity in the market; so, its catering service is not a nonentity (British Airways, 2009). Service Professionals The quality of catering service provided by BA can be considered to be highly professional. The company utilizes a clear positioning strategy for its catering service. The catering services are of superior quality at quite reasonable prices. Figure 7: Position Map of Catering Service High Quality British Airways Low Price High Price Low Quality (Source: Author’s Creation) It is also found that prices and products of catering services of the company are designed according to exact requirements of target customers segment. The target customers of BA who avails these catering services can determined on basis of demographics. The on-board catering service of the company is used by middle income as well as high profile customers (Voss, Tsikriktsis and Frohlich, 2002). The middle income passengers avails Economy Dinning menus of the airline and the rich affluent customers order for customized Special Meals or First Dinning Menus. The above advantages of BA’s catering services clearly imply that company constantly upgrades this service aspect to provide higher levels of satisfaction to customers. Additionally, catering operations and marketing activities of the company shares a type of symbiotic relationship. For example, Club Kitchen of the airline is claimed to be highly efficient, which in turn enhances brand value of the airline for rich customers. The catering department of the company also appoints large number of employees and the firm follows a proactive investment oriented method of human resource management in this department. Thus, BA provides catering services to worldwide customers as professionals (British Airways, 2009). Service Leaders The quality of catering service provided by BA cannot be regarded in the service leading stage. For instance, catering service provided by Lufthansa Sky Chefs is much superior to that of BA. Moreover, all existing employees of the catering department of BA are not sincerely committed to the goals and values of the firm. They do not work on basis of strategic management principles, as they have refused to implement cost cut measures in their operations (British Airways, 2009). Recommendations Some minimal changes can make the catering service quality of BA a service leader in the industry from service professional stage. The cooks and chefs recruited in the concerned department of the company must try to prepare less classic and expensive meals on the whole. Since the economic meltdown in 2009, travellers prefer less costly flights over the rich and classy ones. The service quality of the firm must not differ in terms of ticket prices owned by the passengers. Instead of primarily focussing on English tradition, the company should focus on the traditions of diverse regions, while preparing its basic three course meal menus. Use of allergens should be reduced in the meals provided by the airline. Similar to LSG, chefs of BA must try to focus more on standardization and lean process for achieving cost effectiveness. Employee training and skill development sessions can significantly help to render on-board catering service of the firm more than a mere professional service (Andersen, 2000). Conclusion From the above context, it would be correct to conclude that service quality of British Airways’ on-board catering is at the service professional stage. The catering service provided by the airline is highly complex in nature. Large numbers of workers are recruited by the company for its on-board catering service division. However, catering service of the company acts as one of its marketing tool. The deregulation in the airline industry has significantly increased competition among firms in the industry as well as enhanced customer satisfaction perceptions of the firms. In reality, perceptions of the customers regarding quality of meal available on airlines are very poor. The travel experiences of consumers are judged according to the quality of food and drinks provided to them on flights. Thus, superior quality of catering service provided by BA substantially influences brand value and profit generation in the present scenario. Even so, companies like, Lufthansa, are still ahead of BA in terms of catering services. In the long run by implementing the abovementioned recommendations, the company can become a catering service quality leader in the industry (Smyth and Pearce, 2006). Reference List Andersen, J.A., 2000. Leadership and leadership research. Current Issues in Business Disciplines, 5, pp. 2267-2287. British Airways, 2009. Annual report and accounts. 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