On and off-Line Strategic Options for Low-Cost Carrier Easy Jet Airlines - Coursework Example

Low cost carrier EasyJET Contents Introduction 3 Discussion 3  Evaluation of the on and off-line strategic options available to the company and suggestion realistic set of objectives, actions and tactics that they should be considering in order to achieve a sustainable competitive advantage 3 Justification of arguments from the viewpoint of a strategic marketing focus for the 5 year timeline suggested 5 Difficulties in implementing the plans proposed and making suggestions to meet these challenges 7 Conclusion 8 References 10 Introduction Easy Jet airlines are known for its low cost and are regarded as the fourth largest airline of Europe. The major aim of Easy Jet airlines is to provide their customers with the best quality and point to point services. The airlines focus on offering some reliable consistent air fares across leisure tours in European route and also for business market segment. The major competitive advantage of the company is that it is being able to meet the demand of their consumers by offering them low air fares and appropriate service. Easy Jet even takes measures to keep their employees satisfied so that there are able to deliver productive results and offer value added services to the customers. The main goal of Easy Jet is to maximize aircraft utilization so as to provide point to point aircrafts and to reduce the overall overhead cost. The mission of this airline forms its major strength in the highly competitive airline industry. Easy Jet incorporates low cost strategy into its business operations and offers the lowest fare possible to the customers in comparison to all its competitors in the market place. Discussion  Evaluation of the on and off-line strategic options available to the company and suggestion realistic set of objectives, actions and tactics that they should be considering in order to achieve a sustainable competitive advantage Easy Jet Airlines has been able to maintain a competitive position and is one of the successful and greatest airlines in Europe. However the company needs to develop some innovative strategies so that it can achieve a sustainable competitive position in the market place. There are some strategic options that are available to the company which can be explored in an effective manner. Easy Jet cuts down a lot of cost in terms of short haul routes as it does not have to include any form of frills services, transit cost for passenger assistance for those who has connecting flights or even of baggage transfer. These additional costs can be utilized in some other strategic areas so that it can give a tough competition to other players in the industry such as Ryan Air and other domestic airlines. In today’s competitive world low cost strategy is adopted by maximum of the companies in every sector so it is important for Easy Jet to offer something more to its customers (Abell, 2010, pp.45-46). The available strategic options that the company has are in the fields of more promotions, advanced online facilities, offering more of destinations and to enhance customer loyalty programs. These strategies would help the company to acquire new customers as well as retain the existing ones. Competitive advantage can be achieved by a company by utilizing its resources and capabilities to the maximum so as to perform at higher levels in comparison to all other players in the same industry. As per the theories that have been stated by Porter there are four different strategies that can be used by companies so as to achieve competitive advantage in the industry. The four strategies are cost leadership, differentiation, innovation and operational effectiveness strategy (Batey, 2012, pp. 67-68). The cost leadership strategy denotes that a company’s main goal is to deliver services or products at the lowest cost in the industry and even encompass good discounts and offers. The differentiation strategy states that the company would adopt measures so that they are able to offer some unique products or services that cannot be easily copied by other players or are being offered currently by any other players (Belobaba, Odoni and Barnhart, 2009, pp.75-76). The innovation strategy is basically adopted by those companies specifically in the technological sector so as to introduce a completely new product range or services that are completely new to the industry. Lastly the operational effectiveness strategy denotes that a company adopts measures so that the business operations are performed much well in relation to other competitors which helps in developing brand image and makes it the first preference amongst all the players in the market (Codita, 2011, pp. 113-114). Easy Jet has already been able to develop a market position through its low cost air fares and now the company can adopt measures such as differentiation and operational effectiveness strategy. The differentiation strategy can be obtained through expanding air routes and even promoting their services so as to attract more number of customers (Doole and Lowe, 2008, pp. 167-168). The other strategy would require the company to set high performance standards for its operations so that there is no delay in air routes and the aircrafts are departed on time for various destinations. The objectives of the company for the suggested strategic options would be to build a strong brand reputation so that the passengers do not have a perception that low cost reflects compromise on quality of service (Lynch, 2007, pp. 96-97). The set objective is SMART as it is aligned with growing competition and the growing need for constantly upgrade service level specially in airline industry that faces a tough challenge to sustain its market share over the years. The main action plan to be undertaken by Easy Jet would be to improve its operational efficiency and to maintain good relationships with customers most importantly the business segments as these customers prefer to travel on time rather than any frill benefits. Justification of arguments from the viewpoint of a strategic marketing focus for the 5 year timeline suggested The strategic options that the company has which can be incorporated in the system in the next five years so as to give profitable returns are advantageous for the company so as to achieve sustainability in the market place. The strategy that Easy Jet has adopted of low cost air fares is currently imitated by many players in the airline industry so the main focus of the company would be to do some value addition to its services. Easy Jet has limited its operations which have even resulted into a lot of restrictions of its market growth (Ulwick, 2005, pp. 105-106). The need for adaptability towards new strategic directions is only because it would help the company to maintain its market leader position and even would help to build a barrier for all possible new entrants in the industry. In order to develop such sustainable program the best approach that can be considered by the company is to design an interactive platform where the customers can write in queries they have regarding flight details, etc., or even can come up with their experience travelling with Easy Jet and some future recommendations for improved service which can be utilized by the company (Markides, 2013, pp. 66-68). The other marketing approach would be to go into an agreement with all the tour agents in Europe so that their service reaches out to the maximum tourists or citizens who wish to fly over across locations in Europe within the minimum time and at the lowest cost. Easy Jet needs to take active measures so that it can deliver bulk mails or messages to the entire existing passenger list so as to make them aware of their new offers or discounts and special air routes designed across some of the remote locations. Graham’s matrix describes the best as to which time would be appropriate for adoption of such strategies. The diagram of this matrix has been given below- (Hastings, 2013, p.155) As per this matrix this year would be the right time for the company to incorporate new strategies into the business operations. The major market segment for the company should be the business people and tourist travelling across Europe. The company possesses intangible assets in the form of expertise, operational efficiency, skilled staff, and brand image. The tangible assets comprise of the wide range of aircrafts, human resource, infrastructure and financial stability. These assets and financial resources are compatible enough for the company to set its operations this year. Relationship marketing campaign can help in adding value to Easy Jet’s services and this can be achieved through designing some loyalty programs so as to retain existing customer base by offering them some discounts on regular travel or by giving some complimentary gifts to all those customers who uses their aircrafts for frequent travel (Richter, 2012, pp.132-133). This would even comprise of some promotional activities in the form of tour agents and also in different business as well as travel magazines so as to attract a completely new market segment. As per the Ansoff matrix, Easy Jet needs to focus more on its service development which can only be achieved through offering some more aircrafts in routes such as Scandinavian capital comprising of places such as Helsiki and Stockholm where there are no flights of Easy Jet and even the number of airline options is low and that of low cost airlines is null in these regions (Simerson, 2011, pp. 212-213). Difficulties in implementing the plans proposed and making suggestions to meet these challenges The company is cutting down a lot of costs from meals and snacks that other airlines offer to their customers. This reduction in operating costs can benefit the company to adopt some of strategies of the proposed marketing campaign such as advertisements, promotions, loyalty programs and extended flight routes so as to offer their customers convenience at low cost (Spulber, 2007, pp. 133-134). The company has financial stability to support such strategic campaigns but the system lacks some advanced technology that would help them to capture the records of the existing customers and even be aware of some potential customers (Keller, 2008, pp. 103-104). This would be required by the company in terms of building effective relationships with the customers and even tracking records so as to support some loyalty programs in order to retain the existing the customers and generate business from this customer base through positive word of mouth to their friends and relatives (Steers, 2006, pp. 193-194). The company lacks good CRM or customer relationship management software to handle such innovative approaches. This challenge can be solved by investing the saved operating costs in this sector to gain sustained competitive advantage. The other approach of extending its aircraft routes would require more number of staff and a proper restructuring of schedules of all its airlines (Tielmann, 2010, pp. 173-174). The company currently would face the challenge of insufficiency of staff and this can be overcome by transferring some of the experienced ground staff to specific duties on the new extended aircrafts and recruit some fresh candidates for ground duty. Conclusion The airline industry is a highly competitive industry and in order to gain competitive advantage in this sector it is very essential for a company to take active measures so to enforce customer satisfaction and retain the existing customers. It has been proved from various studies that new customers are often more costly to acquire in relation to retaining some existing customers who can generate more profits of the company. The main aim of the proposed strategic approaches for Easy Jet for five years down the line would be build customer relationships and offer value added services and not just to be focused on point to point flights. The company needs to overcome some of its challenges in terms of technology and skilled workforce so that the recommended strategic propositions can be incorporated effectively into the system. References Abell, D. F. 2010. Managing with Dual Strategies. USA: Simon and Schuster. Batey, M. 2012. Brand Meaning. USA: Psychology Press. Belobaba, P., Odoni, A., and Barnhart, A. 2009. The Global Airline Industry. UK : John Wiley & Sons. Codita, R. 2011. Contingency Factors of Marketing-Mix Standardization. Germany : Springer Doole, I. and Lowe, R. 2008. International Marketing Strategy: Analysis, Development and Implementation. Canada: Cengage Learning EMEA. Hastings, G. 2013. The Marketing Matrix: How the Corporation Gets Its Power – And How We Can Reclaim It. New York: Routledge. Keller, P. 2008. Strategic Brand Management. New Delhi: Pearson Education India. Lynch, 2007. Corporate Strategy. New Delhi: Pearson Education India. Markides, C.C. 2013. Game-Changing Strategies: How to Create New Market Space in Established Industries by Breaking the Rules. San Francisco: John Wiley & Sons. Richter, T. 2012. International Marketing Mix Management. Berlin: Logos Verlag Berlin GmbH. Simerson, B.K. 2011. Strategic Planning: A Practical Guide to Strategy Formulation and Execution. USA: ABC-CLIO. Spulber, 2007. Global Competitive Strategy. USA: Cambridge University Press. Steers, R. M. 2006. Managing in the Global Economy. Canada: M.E. Sharpe. Tielmann, V. 2010. Market Entry Strategies. USA: GRIN Verlag. Ulwick, A. W. 2005. Business Strategy Formulation: Theory, Process and the Intellectual Revolution. USA: IAP. Read More