Description of the Situation of Qantas Company - Case Study Example

Marketing Objectives, Target Market, Positioning and Marketing Mix of the situation of Qantas The company is in a critical financial situation because it does not make much profit as it used to in the early years. The company has made loses of $244 million in the recent years. This is because of the poor performance in the company since workers are not treated well. The poor performance is also caused by the overworking of employees leading to boredom. The great loses has made the company at large to be weak. Although they still receive customers, their level of customer satisfaction has reduced because they do not have enough finances to cater for the costs of services provided in the airline. On the other hand, Jet Star which is a local airline is facing challenges because of the slow growth rate it is experiencing. The local airline lacks focus on the needs and satisfaction of customers at large leading to the small profits made. Due to their lack of focus to customers, the airline is facing great competition from Virgin which offers good services and customer satisfaction to its local passengers (Feinberg et al., 2013). With a GDP annual growth rate of 2.5 percent in Australia, Qantas has a great opportunity in taking hold of the domestic market air travel. This will enable the company to make profits which can reduce the loss they are making at the moment. The company should put its focus on increasing the number of customers in the domestic air travel segment. The domestic market can enable Qantas to overcome the GFC it is facing at the moment. The domestic market can also give Qantas an opportunity to compete against Tiger and Virgin. With the daily advancement of technology in the society today, Qantas can make use of this opportunity to expand its income. This can be achieved by online marketing and electronic booking of air tickets (Zikmund, & Babin, 2012).  Marketing Objectives The following objectives have been made to address the issues of financial crisis, domestic marketing and competition facing Qantas. 1) By the end of two years, the company should be able to recover all the loss it has made by venturing into businesses that are more profitable and improving the performance of the company. 2) Qantas should be able to maintain its position in the market as the leading airline in Australia by offering better services than its competitors. 3) For the company to put much focus on the domestic market by ensuring that it is concerned with the needs of its customers and by the end of two years, it should be strongly established in the segment. The first goal deals with the financial crisis that the company is going through at the moment. Due to the loss that it has made, Qantas has to find a way though to recover all the loss it has made. This cannot be achieved by the profits made by the airline only because such profits are used to cater for all the services and operations taking place every day. The company should be able to venture into other businesses that will generate income which can be used in recovering the $244 million loss encountered in 2013. This can be achieved by Qantas making partnerships with companies that are not airline based. To improve the financial status of the company, the effectiveness of performance among its employees should also be improved. This is because the major reason as to the great loss that the company made was due to poor performance among employees. The employees lacked the motivation of working well because of the poor conditions they worked in. for the company to improve, this has to be an objective or otherwise, the financial status would even be worse than it is at the time (Doran, 1981). The second .objective is for the company to maintain its position as the leading airline in Australia by improving its services. This objective deals with the great competition that Qantas is facing from other airlines like Tiger and Virgin. Due to the poor performance of the company in 2013, Tiger and Virgin became and is still a great threat to the company. These airliners are growing at a high rate and may take up the position Qantas is holding at the moment. Qantas should improve its strategy of marketing and focus more on its customers to be able to outdo these airliners. The competition is quite tough because Tiger and Virgin have also taken position in the domestic market and have succeeded in having their way in the domestic market. Qantas has not put much focus on the domestic like the international market and it is losing it to its competitors. The third objective is for Qantas to put much focus on the domestic airline market by ensuring that it is concerned with the affairs of its customers and attaining stability in the market segment in two years. Qantas has an opportunity in developing the Domestic airline market in Australia because of the increasing GDP of 1.12 percent every year. This can also be a great opportunity for the airline to make profits to cover the losses made in the recent years. Its competitors have also put much focus on the domestic market and for Qantas to be able to compete with them; it will have to venture into the domestic market as well (Doran, 1981). Target market and positioning I will target the domestic air travel segment because it is the major area where Qantas is facing competition. Since it has already established itself in the international market and is still making loses, the domestic market can be the Messiah for the airline. The domestic market has not been properly focused on by the airline making Tiger and Virgin airline to take advantage of the profits it is making to compete against Jet Star. Market positioning For Qantas to identify itself as being unique from its competitors, it should position its products or services an effective manner. This should be a major strategy of competing against its competitors. The company can position its services by using elements such as pricing, offering unique services and differentiated benefits. Pricing: For the company to position itself in the domestic market, it should offer affordable prices for its customers. This will enable it to attract more customers thus increasing its income. The company should offer domestic flight tickets at a lower price than its competitors. With this, the company will be able to acquire more customers and it will able to gain a good position in the domestic market. Differentiated benefits: to be unique from Tiger and Virgin airlines, the company should offer benefits to its customers which are not offered by other domestic airlines in Australia. For example, it can make offers for customers who board their flights more than five times. The offers can include making them pay less for their tickets than the normal passengers. This will motivate passengers to prefer using Jet Star than any other airline. The differentiated benefits will enable Qantas to be unique from other domestic airlines thus making it to be in a better position than its competitors (Shansby & Aaker, 1982). Offering quality services: to gain fame and a good position in the domestic market in Australia, Qantas should provide unique and quality services to its service. As much as the distance covered in domestic airlines is short, the company should ensure that its customers receive good services. This can be achieved by enabling customers to book flights online before the day of departure. This will be effective because customers will be able to know in time whether they will board the airline or not. Good services will help in maintaining customers thus making much profit. Qantas should give clear information to its customers about the time of departure and arrival. With this in place, customers are in a position of making their plans early enough before the scheduled time. Brand name: a brand name always identifies products and services in a unique manner. The company should build its brand name by advertising it in any way possible. Public relation: how the employees of the company relate with its customers is effective in the positioning of the company in the domestic market. Good relations with customers will increase the chances of the customers boarding the airline more often. Qantas should focus on how they treat their customers to gain a position in the domestic market. Wide range of features: Qantas should create airstrips in areas that other airlines do not reach. The areas should have a large population of people and also many customers boarding the plane. This will help in the positioning of the company because they will be able to offer services that are not offered by other companies such as Tiger and Virgin. The planes available should be advanced to carry more passengers and large amounts of cargo over short distances (Wagoki et al, 2012). Marketing mix elements A marketing mix is majorly used in marketing the products and services offered by a company. Its main aim is to reach the target market in an effective manner. Its elements are the 4Ps which represent the product, price, place and promotion. Product Product can either be tangible or intangible. In our case, the products will be intangible meaning that it will dwell on the services offered by the airlines to passengers. To meet the domestic market, Qantas should be in a position to offer its customers service that meet their varying needs. The service they offer should align with the needs of the customers. For domestic air travels, Qantas should ensure that customers are comfortable with the services they offer and it should have a place where they can put in their luggage. Price As a marketing strategy, Qantas should make their tickets to be cheaper than their competitors. However before putting a fixed price, the company should study and evaluate the prices that its competitors are offering to its customers. With this information they can make their prices to be cheaper. This will attract more customers to the company thus having its way in the market share and getting more income. Place The airline should be situated in areas where there is a large population which will encourage more customers. For a domestic market, Qantas needs to put more planes in strategic places which will increase the number of customers boarding the plane. To compete against its competitors, the company should situate its airlines in places that have not been reached by its competitors. This will increase the chances of making much profit and income and the company can be able cover for the $240 million it lost in the recent years. Promotions To stabilize and compete against its competitors in the domestic market, Qantas should use the following promotional strategies. Advertising: the company should use advertising agencies to inform its customers about the services and products they offer in the domestic airline. They can achieve this by creating media advertisements on the TVs, radio, newspapers, magazines, billboards and in brochures. In making these adverts, they should be clear on what they offer. They should also emphasize on the quality and services they offer which are not found in other airlines. Sales promotion: Although this lasts for a short time, the company should apply this as a marketing tool. It should make promotions to its customers by offering tickets at great discounts. This is done to gain customers and also gain their trust. With this strategy, Qantas will be able to effectively compete against its competitors. It will be able to maintain its position as the leading airline in Australia. Personal selling or direct marketing: this is a more interactive form of marketing the domestic airline. It involves direct interaction with customers in various areas. However, it is tiresome and need a lot of patience (Nicole, 2012). Role of the marketing plan The marketing plan is very efficient for Qantas because it enables the management to evaluate the performance of the company. The company is able to know how the various segments of the company are doing and how it is doing in the airline industry at large. With a market plan, the company can identify its strengths and weaknesses and will be able to know how to deal with them. A marketing plan also makes the management of the company to identify the major opportunities it has in the market and how to implement them. The company can also identify the major threats that are facing the company and they can deal with them before they bring problems to the company. With a marketing plan, Qantas can identify the major marketing strategies to effectively market itself in the airline industry. It can also identify the various ways of positioning itself in the market in order to compete effectively with its competitors. It also helps the company in identifying various ways of increasing income to cover the losses it made during the financial crisis. It also helps in saving the time that would have been used in marketing activities that would not be productive to the company. It helps the company to identify the areas of allocation of responsibility and saves on the costs that the company would incur in fulfilling its budget. Generally, a marketing plan enables the company to control its operations in an effective manner (Khemal, 2014). References Aaker, D & Shansby, J (1982). Positioning your product. Business horizons. Vol. 25, no. 4, pg. 56-62. Doran T. (1981). Theres a S.M.A.R.T. way to write managements goals and objectives. Management Review. Volume 70, no.1, pp. 35–36. Feinberg, F. M., Kinnear, T. C., & Taylor, J. R. (2013). Modern Marketing Research: Concepts, Methods, and Cases. New York : Cengage Learning. Khemal, D. (2014). Why your marketing plan is important to your business. Retrieved April 9, 2014 from http://www.streetdirectory.com/marketing/why-your-marketing-plan-is-important-to-your-business.html Nicole R. (2012). Qantas marketing strategies. Retrieved April 9, 2014 from http://www.prezi.com/qantas-marketing-strategies/html Samuel M., Kanyagia, P. & Wagoki J. (2012). Market positioning and organizational performance. International journal of arts and commerce. Vol. 1, no. 4, pg. 121-130. Zikmund, W. G., & Babin, B. J. (2012). Essentials of marketing research. New York, NY: South-Western Pub. Read More