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Importanceof logistics management
Importanceof logistics management
Importanceof logistics management
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1. Consider the air travel industry’s microenvironment. Using Figure 3.1, indentify the main companies and other organisations forming the microenvironment. Microenvironment is the factors that impact to organisation ability to serve its customers. In air travel industry, microenvironment can be say that is • Suppliers: Transport industry need vehicle to serve its customers, thus Boeing and Airbus, aerospace company, are main suppliers of air transport. Moreover, serving meal is one of its services that provided almost every flight. In-flight food companies, so are suppliers in this industry. • Company: Company need appropriate decision to perform efficiently. Such internal organisation as, finance department, account department, marketing department and so on, are influence to strength and weakness of company. Each company differing focus on different market. Qantas Group, for instead, transfer domestic flight to low-cost subsidiary airline, Jetstar, and drop some flights to reduce capacity and generate more profit in economic downturn while Singapore airlines concern about its premium market. (Geoffrey 2010, p43) • Competitors: Company that serve the same thing to the same group of customer, which in this case can be other airline or other transport, such as, train, bus or cruiser. • Marketing intermediaries: Instead of promote itself, agencies both ticket and travel, is chance of transport industry to make more sale which in globalisation, they effectively provide service via internet, telephone and also branch office. Customers simply access to agencies that provided like one-stop services. • Customers: Customers of air travel are consumer markets and international markets, such as tourists, students and businessmen. ... ... middle of paper ... ...ompany interested to increase flights in that. Thus, companies that have serviced in Asia have to try harder to attract customer by mean of concern about offer them cheaper price. 4. Why do those who pay more for air travel perceive value, when it is clear that many other people perceive value when they use a low-price air carrier? Price is not only one factor that used to choose this kind of service. Air travel industry depends on many factors such as, type of customer, how long of trip, service and facility in flight. In long trip flight, for instead, customer would like to have comfortable and wide seat, more room for leg, good meal, sufficient personal entertainment and prefer to pay more money for that. Moreover, others convenient things that provided such as check-in online, mile collection to be higher member with privilege option or after flight service.
of price versus service in the airline industry as a whole, as well as, the
Mason, K. J. (2001). "Marketing low-cost airline services to business travellers." Journal of Air Transport Management 7(2): 103-109.
Spirit addresses “price” by attempting to get the lowest possible fair for their potential customers. They have instituted their “unbundling” strategy that essentially removes all the conveniences that other airlines afford. Fees for checked bags, fees for flight changes, and no complementary in-flight beverages are just a few of the cost-trimming techniques employed. This strategy allows Spirit to come up with impossibly low fares. It also conforms to customers who just want to get from point A to point B without paying extra for services they don’t use. This strategy, coupled with an in-your-face “promotion” ploy, has made Spirit Airlines “the most profitable airline in the U.S.” (Nicas, 2012).
... amid nations (Gerber 2002, p. 29). Although there has been a major decrease of barriers to trade liberalisation concerning flight amenities in the last century, there are imperative uncontrollable external factors a business must assess and weigh before entering international borders and becoming a prosperous globally identified firm (Ramamurti & Sarathy 1997). Qantas, a highly esteemed patriotic and iconic Australian brand has demonstrated accomplishment intercontinentally. The ultimate success of their business, in order to sustain competitiveness in their global market, will rely heavily on their continuous assessment of combined political and legal reforms, economic dynamics, sociocultural influences, technological modifications and environmental concerns and their interlocking marketing strategies to gain the most beneficial opportunities that come their way.
In order to measure the impact of United's price increase, we would need the price elasticity of the demand. The main problem is that there is no agreement as to whether, generally speaking, air transportation is or is not relatively price elastic. There is ample evidence that the introduction of deeply discounted fares by the low cost carriers can be very price elastic, although, each type of traveler has its own price characteristics.
To identify the issues and problems that the company is facing and how the company incorporates into its business strategy the major trends that concerns air delivery business.
2.Price: A price must be set to add value to the consumer but also add revenue to the airline. Cost is considered the most volatile areas in the airline industry today; deregulation has forced pricing to become the major competitive variable. Like any industry supply and demand control the pricing elements of the ai...
The complements such as TV screens, Wi-Fi Internet capability, and comfort aboard the airplane do influence customers. However, people prefer airplanes because of the length of time to reach their destination.
Lufthansa, one of the world’s biggest airliners, has divisions handing maintenance, catering and air cargo. Since the World War II the airline industry has never earned its cost of capital over the business cycle (Hitt, 2010). Most of the airline companies have either filed for bankruptcy or are being bailed out by their government. Lufthansa had also gone through these tough times, but had resurfaced to become one of the worlds most profitable airline company. The company adapted a transnational strategy, seeking to achieve both global efficiency and local responsiveness. Lufthansa’s monopoly in Germany came to a halt with the creating of the European Union. All the EU member countries become one regional and therefore the European competition became, an increasingly a local competition. Lufthansa created its regional Hubs, to cater for its domestic market. But the availability of substitutes such as bullet trains and the Euro tunnel, made is necessary for Lufthansa to create short traveling time, customizations and quality standards in the region to achieve a competitive advantage. But outside the EU there are no substitute to air travels as such all the flag carriers are competing in the market, the international airline industry is a highly competitive environment. A new force has also emerged in the world of air travel, in the form of three Gulf airlines with jumbo ambitions. Within a decade Dubai’s Emirates, Qatar Airways and Eithad from Abu Dhabi have between them carried the capacity of two hundred million passengers (Micheal, 2010). The company had to go global and therefore adopted the international corporate-level strategy, where Lufthansa will ope...
Dixit, A. (2000). Growth of discounting in the airline industry: Theory, practice, and problems. (Order No. 9978379, Georgia Institute of Technology). ProQuest Dissertations and Theses, , 330-330 p. Retrieved from http://search.proquest.com/docview/304592352?accountid=8364. (304592352).
AirAsia Berhad (AirAsia) is a leading Low-Cost Carrier in the Association of Southeast Asian Nations (ASEAN) region. AirAsia focuses on providing high-frequency services on short-haul domestic and international routes. The main goal of this paper is to analyse the business strategy of AirAsia as a low-cost airline. This paper aims to apply the management process of strategy and analyse the three levels of strategy by which AirAsia is able to maintain its reputation as the top Low-Cost Carrier (LCC) in Asia. This paper will then show how innovation is a key aspect in AirAsia’s strategy, and will finally consider the external environment framework in which AirAsia is succeeding.
Although JetBlue focuses on service value through highly productive personnel and aircraft, potential consumers are still interested in value when they fly; the Price aspect of the marketing mix. Customers are interested in quality service at a reasonable price.
Within the airline industry currently the airlines can be divided into low cost airlines and full service airlines. The low cost airlines targets customers that are seeking no frills connectivity between cities at low ticket prices. The full service airlines provide several add-ons like free meals, on plane entertainment, and communication facilities. The target market for full service airlines are customers who are willing to spend extra for the services that the airlines provides.
This identifies the main micro-environmental influences by classifying them into six groups: Political, Economical, Sociocultural, Technological, Environmental and Legal. By applying this framework to Ryanair it is possible to summarise the key forces in the general environment (see appendix A) likely to present opportunities and threats to the organisation (Johnson & Scholes 2002).
In order to identify Air Mauritius’ target market variables such as demographic, geographic, psychographic and behavioural variables have to be covered. Air Mauritius can be considered a small aircraft company as it has a rather narrow range of planes compared to other airline companies, this is primarily due to the fact that Sir Seewoosagur Ramgoolam International Airport in Mauritius Islands cannot accommodate very large planes. However, it is not a small nor regional airline company and has flight schedules every week in continents such as Africa, Asia, Europe and Australia (O'Hanlon, 2013). Consequently it can be assumed that the target market is basically adult (age) men and women (gender) from different places all over the world who are looking for comfort and good services while travelling (benefits sought) of a medium to high status and income in order to be able to pay for all the tariff fares (psychographic). . Hence, it can be approved that Air Mauritius’ target market is scattered worldwide and cannot be really classified as they tend to market for various markets ranging from businessmen to tourists of different ages. However as Mauritius Islands are mostly known for its tourism industry, Air Mauritius is trying a new marketing strategy in order to attract more families to travel with them to Mauritius Islands for touristic reasons (4 trends in family travel for