Airline Marketing Management - Coursework Example

AIRLINE MARKETING MANAGEMENT Introduction In the current world, many inventions and technologieshave been essential in influencing the modern lifestyles. One of these is the airplane, which facilitates national and international travel. The Airplane industry has continued to influence the construction designs of planes and their carrying capacity, something that has necessitated the need for increased travelling. The air travel and aviation industry have become essential as far as human activities are concerned such that people cannot manage their activities effectively without them. Globalisation activities in business and other human activities have played a big role in influencing people’s travelling needs worldwide (Yosef 2005, 21). In this case, it is evident that the world’s airline industry has tremendously progresses in line with the changing needs of people across the world. The industry has altered the way people live; it has made it easy for people to work in different places worldwide, while managing to reach at their workplace on time (Fojt 2006, 16). Additionally, it has increased the growth of businesses through shortening the travel times from one place to another. This has increased the demand for traveling within and out of a country. Airline Companies Airline companies are business firms that facilitate air travel by operating airplanes of various types depending on their market needs. While some airline companies are restricted to operating within the borders of their countries, others operate regional and globally, the choice of which depends on the company’s capacity to fulfill the larger needs of the wider market in the regional and global front (Belobaba 2009, 27). One of the best ways to operate an airline company in the international destinations is to have an understanding of how to operate the company successfully on the national and regional front. Often, business growth and expansion happens when particular airline company managers devise strategies that enable them to exploit opportunities they discover existing in various places. An airline manager is expected to understand how to manage the company in achieving its short and long-term goals and objectives (Fojt 2006, 28). The manager has to make a good environmental analysis and know how to manage the changing economic environment and competition brought by emerging companies in the industry. Management Information Systems and Environmental Scanning and analysis The success of any business depends on its efforts in environment scanning the particular environment in which it is operating. It is important as an airline manager to understand that the process of environmental scanning is a very significant component of the overall international environment scanning. Environmental assessment, monitoring and forecasting all make up the general global environmental analysis for effective business operation (Belobaba 2009, 35). A business’ global business environment describes its microenvironment, which is made up of markets, competitor’s clients, industries and other similar or related companies. Consequently, this environment comprises of the micro level, where customers, human resources and suppliers are included. Environmental scanning and analysis, as practiced by businesses refers to the study and the interpretation of the economic, social, political and the technological factors and trends that influence business operations in various ways. They are also critical in influencing various practices in different industries and markets in general. In conducting a business environmental scanning, some of the important factors to consider include important events in the industry, trends, expectations and issues in the various interest groups. Issues, in the business environment refer to the forerunners of the trend breakers; on the other hand, a shift in the consumers values, tastes and preferences describe the trend breakers. Technological innovations in the environmental scanning process refer to the paradigm changes that are sometimes temporary or permanent. It is important to understand that issues are often less deep-seated and can at times happen to be temporary short-lived reactions to various social phenomena. Conversely, trends can be described as the environmental phenomena that have adopted certain structural characters. The airline sector is often highly competitive, amidst the liberation of various economies and the rapidly growing economic globalisation that has given room for the growth of other emerging businesses (Walsh 2011, 52). In the recent decades, the industry has experienced a broad shakedown, which is expected to have far-reaching implications on the various industry trends in expanding to various international market places. In the past, the airline industry was totally controlled by the government; however, modern developments trends have a change from this practice (Connell 2011, 42). Most airline companies in the United States and Europe are managed privately, with owners deciding on their management and expansion strategies and approaches. This development has seen many airline companies receive trading licenses to offer flight services, something that has brought about extreme competition in the airline industry. in this case, airline companies growing and expanding to operate beyond their regional fronts have to understand the competitors in the industry. This is important for them as they devise their marketing and other management strategies for their effective and successful business operations. Market Research Market research describes the organized efforts involved in the information gathering about certain targeted markets or consumers in the process of a business growth and expansion. This is an essential component of any business strategy geared towards developing certain competitive advantages. Market research activities, as carried out by businesses are often directed towards understanding market characteristics. It is important to understand that market research is an essential component that maintains competitive advantages to a company over its competitors. The process is a source of important information essential in identifying and analyzing market needs, sizes and competition among other important features. In the airline industry like any other economic sectors, marketing managers are expected to conduct market research most often in order to keep abreast with changing trends and issues in the industry (Connell 2011, 47). This is the only way they can manage their expansion processes and growth. Whenever people think about the airline industry, what comes in their minds instants is often the feeling of opulence and luxury including convenience and comfort. However, amidst all these expectations, the fact on the ground is that airline companies worldwide are often confronted with reduced profits, high operating costs, decreasing margins and other demerits arising from various factors in the external international airline environment (Walsh 2011, 54). While passengers may not understand these, enjoying the comfort and conveniences in their travel, it is airline manager and their companies that often suffer from the changing business environment that is sometimes highly unpredictable. In this case, emerging and expanding companies are expected to have a perfect understanding of the requirements for effective airline business. For the new company, I would rely on market research in order to produce information about the important factors in a business external environment. In expanding the airline company, company managers will have to understand the political, economic and competition conditions so that they do not become surprised by sudden unexpectations as they come into the reality of the real business environment. The European airline industry is highly liberal; the industry has many private companies licensed to operate in the environment. This is an important information for the company as it maps out their expansion strategies Market segmentation One of the most reliable marketing strategies in a business’ expansion strategies is market segmentation. This strategy entails dividing the target market into various subsets or sections for consumers with respect to similarities in priorities and marker needs among others. After this division, the company designs and implements strategies it can use in targeting the selected subsets. The process of market segmentation is essential in identifying the target customers and providing relevant supporting data for the company’s effective positioning. This is essential in development of the marketing plan and objectives for the targeted market. A business, can therefore, develop various product differentiation strategies or undifferentiated approaches to exploit the identified opportunities in the targeted market. The differentiated or undifferentiated approaches by the marketing executives rely on the particular demands and other essential attributes of the targeted segments. In the airline industry, market segmentation is an important aspect that enables it to achieve set marketing objectives. According to this airline industry, it has been operating successfully in the selected regional airports in the northern parts of England and 20 other destinations in Europe. The company has been effective in its airline operation and now looks forward to expand and exploit other opportunities in the industry in other parts of Europe. One of the important expansion strategies in its endeavor to increase the number of planes with a larger carrying capacity is having an understanding the business environment that it wants to exploit. Segmenting the targeted market will be helpful in understanding the state and preferences for the consumers in the targeted market and providing solutions for the particular market effectively. By segmenting the market, the expanding airline company will manage to design and introduce various travel packages for clients in certain segments. The effectiveness of these approaches will make the company decide on other ways of adding value to its services. Additionally, this strategy is effective because the company will understand the packages that are effective and carry on with them while discarding those that may not appeal to certain target markets. It is important to note that the process of going global is well managed if done in manageable levels. Competitor analysis In business, one of the important processes in the marketing process is making an analysis of the competitors. Competitors are rival businesses that offer similar or related products as those of the company (Barnhart 2012, 34). The process is essential because it provides important data about factors like strength and weaknesses of the existing competitors in the business environment. In this case, the analysis is essential in providing an offensive as well as a defensive strategic context for identify the opportunities and threats to the business. It is important to note that the process of competitor analysis is a significant corporate strategy for companies seeking international growth and expansion. Many companies do not often conduct competitor analysis in their growth and expansion processes; instead, the marketing managers rely on the informal impressions as well as intuition and conjectures they constantly get in the course of operation. In this dimension, it is evident that many companies are often at risk of finding themselves in competitive blind spots because of lack of reliable comprehensive competitor analysis. In the expanding airline company, a competitor analysis will be one of the important marketing activities that will have to be conducted in the expansion process. Knowing that this industry is liberal in the European airline market, competitor analysis will be essential in providing some of the essential information that can assist in creating approaches and strategies to counter the competition After making the competitor analysis, the company will devise strategies to enhance the value and utility that customers will get by traveling with it. Some of the value addition practices that will be essential in countering the competition from this analysis will include offering special packages for holiday travelers and well as other short breaks. Additionally, competition analysis will be helpful in the pricing of service the airline. It may decide to offer penetrative pricing strategies or competitive, according to the strategies used by the competitor companies. In marketing, competitor analysis helps to avoid the risk of pricing services too low or too high, something that work in its disadvantage. In this case, the analysis is essential in devising the best approach that enables the company to compete effectively in the market, while getting enough returns from its expansion and growth processes. Consumer behavior Consumers are the most important parties in the production process. This is because, they utilize the products and services made by the company by consuming them according to their particular needs. Understanding the buying patterns and behavior of consumers is an essential process that markets have to decide in the process of developing their marketing and internationalization strategies. Consumer behavior is described as the study and analysis of individual people, groups and well as organisations for the particular processes they often rely on when selecting, securing and disposing their products, services and other experiences in satisfying their particular needs. Additionally, the process also examines the impacts of these factors on the consumers in the entire society. It is important for marketers to understand that consumer behavior depends on their purchasing patterns and behavior. In this case, consumers play three basic functions; they are users of the products, payers as well as buyers. When undertaking this process, research has shown that it is a very difficult thing to predict; for this reason, markets are expected to rely on market research, observe past trends and devise their approaches towards the same. For the airline company, the process of expanding its flight services will include having a perfect knowledge on the consumer behavior. The company will be expected to examine some of the preferences that consumers have in their choice of flight companies. They may have to market survey on regular flight consumers as well as companies whose operations spans across the borders of countries in Europe. This way, they will know the specific services to incorporate in their value addition to enhance their business operations. Strategic planning The process of international growth and expansion is not always an easy step as it may sound. While international expansion has many benefits when effectively planned, executed and managed, the company can fail tremendously when it fails to make proper strategic planning for the process. Strategic planning, as practiced in organisations describes the process of defining strategies or directions and coming up with certain decisions that are helpful in pursuing the set strategies. The process also extends to the control mechanisms that guide a company in implementing the already identified strategies. In companies, the process of strategic planning is often the duty of strategists or strategic planners. These people are always expected to include all parties and other reliable sources of research when making their analysis about the organizations ability to undertake certain activities in their management, growth and expansion. Just as in other businesses the process of business growth and expansion in the airline company has to be preceded by a carefully organized strategic planning (Fojt 2006, 51). In this case, the strategic planning will define the approaches to be used and their requirements in the growth process. From the foregone discussion, it is evident that the airline industry in Europe is highly competitive, owing to the fact that it is privately managed as opposed to other places where the sector lies solely in the hands of the government. Strategic planning in this case, will guide the process of market segmentation and the pricing strategies the company will use when reaching new markets in the larger Europe. The process is important as it makes the company prepare adequately for unexpectations, and coping with them effectively, as it establishes competitive advantage and market position. Pricing strategies Pricing is an important process in the process of marketing in companies. This follows the fact that pricing is an important process that plays an essential role in influencing consumer behavior. When expanding the airline industry, the company has prepared to offer various packages to the new clients in the targeted markets. In this case, it is important that the company understand the best pricing strategies for the particular packages in order to have an effective market entry and position. While an organization can have better products and services in the market, its particular pricing can play a role in their success or failure. Prices for the packages in the airline company can be developed in a way to maximize the profits for each of the unit packages sold or for the entire market overall. Most often, companies use different pricing strategies to restrict new entrants or increasing their market share in the new market. The expanding airline company has to know that it can achieve tremendous benefits by having low or high prices for their package units (Lee 2007, 38); alternatively, it can also get huge losses by pricing them low or high; in this case, the pricing strategies will have to be based on information from its market analysis. The marketers will have to understand that finding the best pricing strategy will be essential in enhancing the success of their expansion strategies. While offering new products in the market, many companies often use skimming strategies when setting their prices. Here, the companies, set high prices for these product and services in the hope that the few sales they may make will help them simply to break even. as the competitors introduce similar products, these companies often have made maximum profits. Additionally, the companies will resolve to reduce the prices for these products in order to attract more clients and maintain their market share. Alternatively, the companies way prefer to use penetrative prices; here, the company offers low prices for its products and increased the prices gradually as it client base for the particular products increases. However, the disadvantage with this strategy is that it may take long for a company to break even and begin getting profits from its products. The choice of the particular pricing strategy will rely on the information the airline company will have got from its market research and strategic planning. Product and branding strategies Branding is an important process for all business organizations, the process involves identify the names, symbols and slogans that can be used in the process of marketing and other related activities. Product and company branding is an important marketing activity that influences consumer behavior. It is important to note that consumers make their purchase decisions depending on the popularity of certain product brands. One of the things that the airline company will have to do in the process of making its branding is establishing unique a brand that consumers have not dealt with before (Shaw 2011, 57). This will go a long way in influencing their consumers’ preferences for the company. The marketers will be expected to identify the products packages that the company is introducing in the new markets it is targeting. Being a new company, they will be expected to establish the best slogans, logos and other branding items for the services in order to influence the behavior of consumers in the new market. When a company has a consistent brand, it makes it easy for its consumers to recognize it and trade with it. In this case, it makes the consumers purchase more of the company products and services and influences repeat purchases (Shaw 2011, 561). In the modern airline industry, like other businesses, branding helps companies to stand apart from the rest of other companies in the business environment (Lee 2007, 46). The business ahs to understand that it is no longer operating in the regional environment, but has now advanced to an international and expanded business environment. In this case, proper branding is important in helping to consolidate its performance in the market, while giving it competitive advantages to challenge its rival in the business environment. The airline company, will therefore, have to incorporate the marketing team and other players in its operations so that it develop proper brands that can help it succeed in the newly targeted international market. Bibliography Barnhart, C. 2012. Quantitative problem solving methods in the airline industry a modeling methodology handbook. Springer, New York. Belobaba, P. 2009. The global airline industry. Wiley, Chichester, U.K. Connell, J. 2011. Air transport in the 21st century key strategic developments. Ashgate, Farnham, Surrey, England: Fojt, M. 2006. The Airline Industry. Emerald Group Pub, Bradford, England. Lee, D. 2007. The economics of airline institutions, operations and marketing. Elsevier, Amsterdam. Shaw, S. 2011. Airline marketing and management (7th ed.). Ashgate, Burlington, Vt. Walsh, C. 2011. Airline industry strategies, operations and safety. Nova Science, New York. Yosef, E. 2005. The evolution of the US airline industry theory, strategy and policy. 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