The United Kingdom Regional Airlines Segmentation - Assignment Example

?Marketing Management Table of Contents Market Segmentation 3 Benefits of Segmentation 4 Recommendations for better Future Experience 6 Competitive Advantage 9 Marketing Communication 11 References 13 Bibliography 15 Market Segmentation A market comprises simply of a group of users which exhibits similar needs. It is a set of possible buyers of a product (Allen, Macy & Hutchison, 2009, p.21). In other words a market comprises of subgroups and segments which contains users of minor differentiated needs from the other segments. Therefore for a company to perform its operation effectively in the market place it needs to segment its intended market appropriately (Croft, 1994, p.1). Market segmentation has always been an area where a company needs to work a lot. Market segmentation is therefore defined as the procedure which a company follows to identify different segments of user inside the market place who could be possibly targeted by using different products, services and other marketing programs. Now a day’s goods and services are strictly developed by considering the wants and needs of a customer. Subsequently marketing segmentation is considered as an essential and central element of marketing for a company (Kamakura & Wedel, 2000, p.3). Now in the context of UK regional airlines segmentation can play a major role for identifying the specific business segments as well as the consumer segments and also to boost the total number of footfalls. There are two bases of market segmentation i.e. observable segmentation and unobservable segmentation. An observable segmentation include geographic, cultural, demographic and socio economic segmentation. While on the other hand unobservable segmentation includes psychographic, values and personality segmentation (Businessmate, n.d.). Among the available types of segmentation the company can make use of demographic segmentation and geographical segmentation. The company needs to target small and medium business ventures and average income group individual consumers. Therefore the company may strictly employ demographic segmentation in respect of statistics and income level. Now to target the business houses the company can offer them special prices and discounts for frequent travellers and bulk bookings. After making the segmentation and targeting the intended customers it becomes very much vital for the company to position it in the market. As positioning can be defined as how a company positions its product in the minds of the consumers (Ries, 2003, p.3). In this context it is recommended that the company must position itself as the carries which offers high facilities but at low cost. This will surely attract bulk customers if the positioning can be properly carried out. Benefits of Segmentation It has been described that Regional Airlines will target mainly individual consumers with average income level and small and medium business ventures. The benefits which will be availed by the company for taking up this particular course of action are illustrated below. The company will be able to focus on the particular segments which will allow the marketing team to initiate different types marketing events and programs for the target group. This will also ensure in utilizing the allotted budget for marketing in the correct place. Since it becomes practically impossible to cater to each and every individual it’s always better to make segmentation (Themanager, n.d.). Therefore rather than going for a mass target the company can cater to a specific segment more efficiently. In such case the company can hugely cut down its promotional cost, there will be no need of using all the available promotional platforms, only which fits the requirement can be used. For example to target the business consumers the company can make use of business magazines apart from advertising in television. This will also help the company to undertake market expansion. Once a set of loyal customers are generated, the company can further expand domestically as well as in the other parts of Europe. Presently UK Regional Airlines only have its international destination in Paris, but it can expand by taking up geographic segmentation as well. The company can easily amalgamate geographic segmentation along with the demographic factors. For example Regional Airlines may target the small and medium business ventures from Spain, Italy and even from other countries. But this will solely depend upon the expansion of the company. Customer retention is also another factor which can be encouraged to a large extent if segmentation is properly carried out. All of the above mentioned factors can contribute heavily towards increasing the number of customers for the airlines company. It will also ensure that if mainly the business segment is satisfied they have the potential to offer large customers to the company as they are frequent travellers. Recommendations for better Future Experience For the reason of suggesting some ways by which the company may better service excellence in the future it is very much vital to know and assess the market along with strengths, opportunities and threats of the company. Therefore in order to carry out the market analysis of the company SWOT analysis technique has been used for the evaluation. SWOT analysis is considered as an essential element which matches the company’s capabilities and resources to the environment where it operates along with its competitors (Richter & Pahl, 2009, p.1). SWOT analysis can be used to appraise the position of a company in the market, process of sales and distribution, business ideas etc (Pehlchen, 2007, p.28). It is also important instrument for portraying the internal and external information of a company (Bohm, 2009, p.1). Strengths of UK Regional Airlines It offers low cost travelling to the customers. High offerings to the customers. Weakness Less number of loyal customers. Financial slowdown is also another major weakness for the company. Opportunity It holds the opportunity to cater to bulk group of business customers. Expansion into foreign avenues is also an opportunity that the company presently holds. Presently it is the subsidiary to air Berlin, therefore based on its brand image the campany can certainly make the most out of it. Threats Economic downfall and less travelling of consumers acts as a major threat to the company. The competitors of the company such as Ryanair, Easyjet and Aer Lingus give a stiff competition to the company. Therefore after analysing the present internal environment and the market situation the following are the recommendations by which the company can certainly ensure a better future experience for the passengers. 1. It is highly recommended that the company must focus towards the facilities they are offering to its customers. Some of the additional features which can be launched may include separate business class and economy class for the different segment of customers. 2. Ticket reservation system can be made simpler. Apart from directly buying and online booking the company may introduce some other ways of ticket reservation. The company can employ mobile booking with the help of SMS feature. They can also make some ticket selling counters in one or two places of the city hub. This will ensure that customers get their ticket in an effortless way. 3. One of the innovative techniques which will surely distinguish Regional airline from its competitors is through the free route transport facility. In this case the company may offer the customers free road transportation after they get out of the plane. The transport will help the customer’s to reach their desired destination. But in order to do it in a cost effective way the company may use busses which will carry a group of customers at the same time. This facility will surely attract lots of customer and will also hugely make positive impacts in the customer experiences. 4. The interior environment of the plane can be also enhanced for providing better customer experiences. This can be done in the form of installation of some technical equipment for the purpose of entertainment of the consumers. 5. The company may also develop some program where it will be listening to the queries and suggestion from the customers in order to develop the current offerings. This can be undertaken by opening a customer care centre for customer suggestion and queries or by placing physical suggestion boxes at different airports. 6. Another important aspect is that the company must hugely focus on the training of the employees. They should be trained in such a manner that the customers get highly satisfied by interacting with them. The hospitality must be given high priorities. Competitive Advantage In this turbulent business environment a company needs to have some competitive advantages for its survival and existence. Competitive advantage can be defined as a condition or a particular aspect which makes an organization more successful from its competitors (Cambridge, n.d.). Competitive advantage is the innermost criteria for a firm to be successful in the competitive market. Generally firms experiences slow growth rate is due to their inability in grasping competitive advantage. For example competitive advantage for a firm can be like as, when a firm sells its product in the market at low price as compared to its customers but offers the same quality, features and value for the product. In other words a competitive advantage is about the way an organisation puts its business strategies into action (Porter, 1998, p.xxi). Therefore it becomes very much essential for Regional Airlines to have some competitive advantages over its competitors. The competitive advantage can be achieved by undergoing or undertaking the following course of action. A strong marketing team of the company which makes the competitor look weak: - The Company must develop a sales force which posses superior skills and expertises. The sales team must be given high end training in order to increase their communication skills. Greater Customer service: - The Company must develop a strong that will be looking after the customer service and satisfaction process. Elimination of barriers within the internal departments: - Most organizations are faced with problems of the barrier of communication within the internal departments. Therefore if this area of concern is sorted out, it will surely provide competitive advantage to the company. Smarter Advertising strategies: - The Company must thoroughly focus on the advertising campaigns. It is recommended that Regional Airlines must deploy smarter and innovative advertisement campaigns which will help in attracting customer attention. Viral advertisement is one such tool which will serve the purpose to greater extent. Viral marketing is therefore defined as a type of marketing activity where information about the product and services spreads through the people via internet (Cambridge, n.d.). Marketing Communication Now in order to communicate the messages of the company to the intended customers a suitable communication tools needs to be used. The promotional tools which can be undertaken by Regional Airlines are as follows:- Advertising campaigns: - Newspaper advertisement can play a major role in drawing the attention of the consumers toward the company. According to the target market the company must advertise about itself in the business related newspapers. In Newspaper advertisement if the company can provide some discount coupons and some contests it will help to grab customer attention. Magazines: - The Company can also make use of business magazines and sports & entertainments magazines for targeting business and individual consumers respectively. Sponsorships: - Sponsorship is one more tool which can be used by the company to make its presence felt in the market. This will also boost their brand image and brand value. In order to so the company make take up sponsoring some sporting events. Online Promotion: - Online promotion or digital marketing is the process of marketing by which the product is placed on the digital platform and making it available for the millions of users. It is also known as internet marketing (Miller, 2012, what is digital marketing). The company can extensively make use of websites and other form to promote the services offered. The company can also make use of cost effective promotional platforms like Face book, Twitter, You Tube and Orkut. Coordinated marketing communication is a growing form of marketing communication and holds very much importance (Ashford & Beamish, 2005, p.113). While on the other hand Integrated Marketing Communication is a way of communication which links the communication functions with the marketing function (Hegazy, n.d.). Therefore the company may also employ integrated marketing communication and coordinated marketing communication which will also help in promoting the services effectively in the marketplace. References Allen, P., Macy, A., & Hutchison, T. W. (2009). Record Label Marketing. Massachusetts: Focal Press. Ashford., R., & Beamish, K. (2005). Cim Coursebook 05/06 Marketing Planning. London: Routledge. Bohm, A. (2009). The Swot Analysis. Munich: GRIN Verlag. Businessmate. (No Date). What is a Market Segmentation Analysis. [Online]. Available at: http://www.businessmate.org/Article.php?ArtikelId=206. [Accessed on 19 May 2012]. Cambridge. (No Date). Competitive Advantage. [Online]. Available at: http://dictionary.cambridge.org/dictionary/business-english/competitive-advantage. [Accessed on 19 May 2012]. Cambridge. (No Date). Viral Marketing. [Online]. Available at: http://dictionary.cambridge.org/dictionary/business-english/viral-marketing. [Accessed on 19 May 2012]. Croft, M. J. (1994). Market Segmentation: A Step-By-Step Guide to Profitable New Business. London: Routledge. Hegazy, I. (No Date). Workshop Objectives, Proposed Agenda and Working Procedures. [Ppt]. Available at: www.kult-educ.org/wksp/imc-4/files/ibrahim/IMC-4_1-2.ppt. [Accessed on 19 May 2012]. Kamakura, W. A., & Wedel, M. (2000). Market Segmentation: Conceptual and Methodological Foundations. Berlin: Springer. Miller, M. (2012). B2B Digital Marketing: Using the Web to Market Directly to Businesses. New Jersey: Que Publishing Pehlchen, B. (2007). Analysis of the Chilean Tourism Market - Products and Opportunities for the Destination Pucon and the IXth Region. Munich: GRIN Verlag. Porter, M. E. (1998). Competitive Advantage: Creating and Sustaining Superior Performance: with a New Introduction. US: Simon and Schuster. Richter, A., & Pahl, N. (2009). SWOT Analysis- Idea, Methodology and a Practical Approach. Munich: GRIN Verlag. Ries. (2003). Positioning: The Battle for Your Mind. New Delhi: Tata McGraw-Hill Education. Themanager. (No Date). Why Segmentation. [Online]. Available at: http://www.themanager.org/marketing/segmentation.htm. [Accessed on 19 May 2012]. Bibliography Collica, R. S. (2007). CRM Segmentation and Clustering Using SAS Enterprise Miner. Carolina: SAS Institute. Kitchen, P. J. (2006). A Reader in Marketing Communications. Oxford: Taylor & Francis. Sengupta, S. (2005). Brand Positioning: Strategies For Competitive Advantage. New Delhi: Tata McGraw-Hill Education. Shimp, T. A. (2008). Advertising, Promotion, and Other Aspects of Integrated Marketing Communications. Connecticut: Cengage Learning. Weinstein, A. (2004). Handbook of Market Segmentation: Strategic Targeting for Business and Technology Firms. London: Routledge. Read More