Qantas Airlines Customer Behavior - Assignment Example

Qantas Airlines Behavior Report College: Executive Summary This report presents an analysis of the macroeconomic market factors that surround the Qantas Airlines market. It employs the PEST model to analyze the political, economic, social-cultural and technological factors that may impact the establishment and development of business in the Australian market. Further, it explains how these factors that may affect business generally and how it may specifically influence business operation in Qantas. Additionally, it presents the customer characteristics in this business and the way Qantas has selected its specific target market. Qantas Airlines Customer Behavior Report Introduction Qantas is one of best long distance airlines in Australia that has consistently provided satisfying services to its customers. The company provides both local and international flights to its target customers across the world. The ability of the company to succeed comes from its strong strategy that is based on its efficiency in determining customer behavior and striving to satisfy them. Operating in a friendly business environment has worked well with the organizational strategy. The essay evaluates the Qantas environment and seeks to establish the role it plays in influencing the performance of the company. Analysis of Qantas External Environment The external business environment includes all factors that do not fall under the direct influence of the organization. These factors have a significant impact on the way businesses operate and the ability of organizations to establish themselves in the market. IN principle, organizations must adapt to external business factors to promote their business. A PEST model will be employed to analyze the external environment in which Qantas Airlines operates. Political Australia is one of the countries that have the most attractive political factors for business investment. The Australian federal government provides investors with the incentives to invest by reducing their tax and reducing any barriers in entry. All investors are expected to pay 22% tax to the government which is fair in this country (Weller, 2013). The Airlines industry is one of the industries that the government deregulated and investors have a chance to optimize their profits. However, the growth of this industry is likely to attract the government attention, leading to more regulation. In addition, stabilization of the Australian government has motivated local investor to venture into business, and there seem to be a risk for increase in business competition (Homsombat, Lei & Fu, 2014). Economic Economic development in Australia is one of the factors that have led to the growth on the bubble of Airlines in the country. In 2013, the Australian economy grew by over 3% and a good percentage of the population rose to the medium income earners (IBIS World, 2013). The growth of the business and tourism industry in Australia has opened up new employment opportunities leading the rise in social class. As more citizens get employed in Australia, their purchasing power increases and they have enough money to spend transport. As more people can afford luxury, the Airlines market is opening up very fast and the supply is still quite low. Market analysts have predicted that the Airlines market is projected to grow exponentially in next ten years. On this basis, economic development is Australia is opening the business market, becoming a potential market for Airline companies. Since the market is expected to grow over time, it is possible for investors to have a long term investment plan in this market. Social-Cultural Changes In the recent past, Australia has become a multi-cultural society due to increase in the population of foreigners in this country (Egginton, 2005). The consequence of this is that the traditional societies are quickly dropping their culture and the people are adopting new cultures in this country (Pohlong, 2004). As people open up for a new culture, their demand for new types of transport is growing and most travel abroad in search for jobs (Scott, 2014). Additionally, as more jobs open up in the urban areas, Australia is experiencing a massive urban to rural migration in such for employment (Chang & Travaglione, 2012). As more people gain access to town, they get acquainted with new demands. Technology On the other hand, technology is getting its way into the Australian society in a progressive manner. Although Australia has remained in the dark in terms of technology, global investors have introduced technology use in this society. Moreover, technology has become more affordable as the prices of mobile and other electronic gadgets become lower and the people’s purchasing power increase. The result of this is that people have a greater access to technology and the can make it part of their life. The penetration of the smart phone technology has led to the growth of the number of people who have access to the internet technology. For instance, the people can access social sites such as Facebook, twitter and Skype and join the global community (Willis, Kestell, Grainger & Missingham, 2013). The cumulative impact of this is that companies can use the online media to advertise and invite their target customers. The Influence of External Factors in Business Performance Saleem (2010) explains that the external business environment as significant factors that all businesses must consider. Unlike the internal business environment which falls under the direct influence of the investor, the external business external factors govern business and managers must look for ways in which they fit in these binding factors. The Australian business environment appears to be a potential market for any business. As the larger population raise the middle income class, it is clear that the purchasing power of the public increases. Therefore, the Australian market is a potential destination market for both local and international companies (Kelly, 2014). Besides, the rise in economic class ensures that there is efficient circulation of money which leads to economic stability, which is an important factor for any entrepreneur. Secondly, the Australian political and legal factors favour investment. Low tax rates and deregulation ensures that companies lose a small portion of their profit and that they have fewer laws to comply with. This makes it easy for a company to kick-start its business and to acquire a better position in the market. The social-cultural transformation within a country influences the attitudes that influence the public’s purchasing patterns. Retrogressive cultural attitudes may affect business negatively as people remain fixed to traditional habits. Besides, social interconnection helps to create a friendly business environment where investors can interact freely with their customers (Saleem, 2010). The gradual changes in the Australian social scope are a plus for investors. For Qantas Airlines Company, the conducive political environment has in a great way contributed to the success of the company. Attractive government regulations have encouraged investment in the country and the company has few regulations to work with. This has made it easy for the company to make profits as they strive to position themselves as a top airlines company in the market. However, the conducive political aspect is likely to attract new investors hence leading to a rise in competition in the market (Airlinew News, 2014). Therefore, Qantas must be ready to work within competitive airlines industries as new market entrants invest in this market. The economic growth within the country is an opportunity for the airlines company as more people within the target class can afford their services. The increase in employment opportunities in the country has ensured that the public secure better paying jobs and that they can afford flights once in a while. This coupled with social interconnection across the globe has contributed to a rise in the number of people travelling through the airlines (Mules, 2013). The global interconnection has led to an increase in the number of people who intend to visit other countries in search for employment, business opportunities or education. Consequently, the number of customers who use flights is bound to increase presenting an opportunity for Qantas to make better profits. Therefore, economic and social factors in the Australian business environment have presented an opportunity for investment in Qantas. Lastly, technology has in a great way influenced Qantas business perspectives. Notably, technology comes along with both challenges and opportunities for any organization. In Qantas, technology has become a challenge due to the high cost of purchasing computer facilities and training their employees on use of technology. On the other hand, technology has become the best opportunities for the company’s marketing strategy (Dean, Holmes & Smith, 2012). The company leverages on the proliferation of technology within the public domain to market its services online and to conduct online business (Qantas, 2014). The company allows its customers to book flights online without having to visit their offices. This has helped the company to attract customers from all regions of Australia due to the unlimited use of the internet. This has become an important aspect of business development in Qantas. Consumer Profile Organizational targeting is crucial as it defines the characteristics of the customers that a company intends to satisfy with their products and services. For any organization, the level of success depends on the ability of the company to understand the characteristics of the product consumers and to strive to satisfy them (Gaballa & Pearce, 2012). On this ground, environmental scanning helps organizations to clearly establish the customer factor and know their tastes and preferences which are useful for product differentiation. Qantas targets the middle income and high income earners within the local and international markets. This is because the low class category of consumers cannot afford the airline cost and prefer to use other means of transport. The middle and high income earners have the ability to purchase tickets and this makes them the most important target for the company (Mules, 2013). The company targets all ages as long as they can afford the tickets. They carry business people, tourists and families that intend to move in or outside the country. Majority of the target population live in the urban areas due to the social profile and this makes them close to the company’s branches. An important feature of the target customers is their interaction with the media and use of technology. At least, majority of the target population have access to television and other forms of media. This is crucial for a company like Qantas that uses television advertisement as one way of reach for its customers. This ensures that their advertisements are informative and reach the target population (Qantas, 2014). Besides, majority of the internet users in Australian fall within the middle income and high income earners (Khosrowpour, 2012). Therefore, the company’s social media advertisements reach the target population. Much more, this target class is educated and can successfully complete online application of flights. This points out that the company marketing approaches are efficiently dedicated to the consumers owing to their consumer profile. The success of the Qantas Organizational strategy can be attributed to their ability to understand the market and use customer-directed approaches. Conclusion In conclusion, a close analysis of the Australian external business environment is attractive and presents opportunities for companies such as Qantas. The political, economic, social and technology factors present more opportunities for the company than challenges. Economic growths, changes in social attitudes and technological transformations have helped the company to acquire a top position in the airlines market. As the company targets middle income and high income earners who have high social and education profile, they are able to leverage on technology to provide services to their customer for wherever in the world. It is evident that the company still has an opportunity to differentiate their business by taking advantage of growing market in Australia and the rapid changes in technology. The company’s ability to position its strategy in the market will determine its long-term after competition strikes the market. References Airlinew News, (2014). Jetstar Japan Receives Much Needed A$114M Funding Boost From Qantas, Japan Airlines. International Business Times - US ed. Chang, J., & Travaglione, A., (2012). Gender and Employment-structure Patterns in Australias Retail Workforce: An Intra-industry Analysis, Australian Bulletin Of Labour, 38, 4, pp. 315-344, Business Source Complete, EBSCOhost, viewed 7 March 2014 Dean, J., Holmes, S., & Smith, S. (2012). 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Encouraging the adoption of Education technology for improved student outcomes, Australasian Journal Of Engineering Education, 19, 2, p. 109, Informit Engineering Collection, EBSCOhost, viewed 7 March 2014. Top of Form Bottom of Form Read More