can be threats. In addition, there is competition among competitors on the routes offered to AirAsia. The biggest competitors of AirAsia though, are Malaysian Airlines and JetStar Airways. Disclaimer: The reference paper provided by Student Life Saviour should be used as a model paper, and are not intended to be submitted to the universities. Currently, the priority for the company is to maintain the fundamental principle of keeping travel fair as low as possible so that people with weak financial status can also afford to travel in flights. As the rivalry is strong, Airasia may constant in price reduction to compete with them. Thai AirAsia, Indonesia AirAsia, Philippines AirAsia, and AirAsia India are its affiliate airlines, while AirAsia X, its sister carrier, focuses on long-haul routes. AirAsia Airline As the best low-cost passenger. Student Life Saviour is a prominent name in providing assignment, essay and dissertation help services to students. The increase in oil prices has critically impacted the operations of the organisation. Air Asia Competitor analysis In order to compete with AirAsia,. The company confronts various complaints and issues from the customers who are numerous to resolve instantly and result in customer dissatisfaction. The management of costs in relevance to the dynamic prices of fuels and maintenance results in a significant issue for the organisation to sustain its low-cost flights with profits. Other than that, hes a fun loving person. The airline brand should exploit these circumstances. Bargaining power of Buyers The buyer power for Air Asia is analysed to be high as with increasing options in the international market and decreasing prices of air tickets, people of every category of society can afford flying, and hence, the bargaining power of buyers is also high. 2.1.2 Pest Analysis PEST analysis is a useful tool for scanning the general environment. WebFive steps to successful analysis of. The Threat of Substitution The international airline market has sufficient low-priced airline options available for passengers to travel. A Marketing mix mainly focuses on the 4ps of an organization, which are Product, Place, Price, and Promotion. The brand colours of Air Asia are red and white, which represent determination along with passion, perfection, and positivity to serve customers high-quality services at low prices (Mele, Pels and Storbacka, 2015). Relative insignificant influence of buyer to supplier. Thus, the customer may choose to purchase premium airline which may offer them more comfortable facility in almost same price with Airasia. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); This site uses Akismet to reduce spam. Very interesting and informative. High numbers of Competitor. Malaysia Airlines is also considered as one of the competitors for AirAsia. It creates and maintains their competitive advantage by offering the cheaper prices and services than competitors price. The brand names and other brand information used in the SWOT Analysis section are properties of their respective companies. Required fields are marked *. With the increasing number of services by different competitors, AirAsia has also expanded its facilities including the tour packages and hotel booking services that help the company to sustain in the market. According to an estimate, theannual revenueof AirAsia in 2020 was2844million MYR, and it has declined by76.02%. Required fields are marked *. WebAirAsia Bhd Fundamental Company Report Including Financial, SWOT, Competitors and Industry Analysis Enhanced SWOT Analysis (+ US$ 75.00) PESTEL Analysis (+ US$ 150.00) IFE, EFE, IE Matrices (+ US$ 125.00) Porter Five Forces Analysis (+ US$ 75.00) VRIO Analysis (+ US$ 175.00) Special Bundle, including all types of analyses (+ US$ However, the low-cost pricing strategy has allowed the company to target price-conscious customers in the Asian market. The purpose of this report is to examine the market environment for AirAsia, which has established its business in Malaysia. WebAnalysis for Cost Leadership Strategy and Core. Since the airline brand follows the tight costing strategy and it allowed the company to offer cheap fare to the customers. There is no product differentiation while the only different is the airlines packages offered. It must have a good relation with hotels and tourism companies around Asia. Increasing globalisation has led to an increase in the lifestyle and financial condition of people. AirAsia has won many awards over the years. AirAsia has also expanded its social media presence across other platforms including YouTube (@airasia), Twitter (@airasia), Weibo and WeChat. AirAsia offers transportation services to its passengers along with several other services, which includes courier services and cargo services. Here you can choose which regional hub you wish to view, providing you with the most relevant information we have for your specific region. Considering the competitive characteristic of Malaysian airline market, AirAsia has comparatively gained significant customer attention from the customers due to its affordable tickets and additional services. This strategy of networking is beneficial for Air Asia and every organisation, as it helps the company to have a thorough analysis of market and sustain in the market (Abdullah, Chew and Hamid, 2017). This marketing mix 7 Ps model is used to explain the marketing strategy of Air Asia. The company was established in 1993, and the official operation of the company was started on 18 November 1996. This is act as a barrier of entry for the competitor as there are high in capital requirement such as set up of headquarters, purchasing or hiring aircraft, appointment pilots and other staffs like air supervisor. Tiger Airways. The check-in services in Malaysia Airlines are very convenient and comfortable as compared to AirAsia. The branding of the logo of Air Asia is essential for them. As per the past experiences and the feedback of the customers, Malaysia Airlines are found to react their destinations on time in comparison to AirAsia. Fixed cost incurred by an airline company may include the finance cost, hire purchase and staff cost while this fixed cost may be reduce through increase in market share. It offers scheduled flights and chartered flights for passengers, and also provides air cargo services (AirAsia, 2018). AirAsia is one of the largest low fare airline companies in Asia, which has been expanding its routes to different countries since 2001. Start-up Cost is high. To export a reference to this article please select a referencing stye below: If you are the original writer of this essay and no longer wish to have your work published on UKEssays.com then please: Our academic writing and marking services can help you! He has been a guest speaker at prominent colleges in India including IIMs[Read full bio], Your email address will not be published. The other supplier such as fuel supplier, merchandise supplier, or food supplier may be depend on market condition. Another important strategy that Air Asia will consider enhancing is improving Information Technology (IT) services in the company, as well as in the aeroplanes. But in 1993, Air Asia was established to finally connect Asia like no other airline company. As there are approximately 59 low cost airline operating in the industry,it is always easily for the customer to look for alternative. It has subsidiaries in Indonesia, Thai, Phillipines, Japan, 5.It has a fleet size of nearly 300 aircrafts. Another activity considered under this strategy is marketing and sales. Your email address will not be published. Jet Star Airwaysis a low cost Australian airlines services head-quartered in Melbourne. The dynamic oil prices and service costs result into criticality for maintaining the low-cost flights as the organisation focuses on facilitating the most affordable costs to its customers (Daft, Murphy and Willmott, 2010). The price offer by an airline company may not be fixed but it will depend on the time differences between the date of booking and flight. In accordance with the increased demands, the options available for flying has also increased, and hence, the bargaining power for buyers is examined to be high for Air Asia. AirAsia X has amplified its profit-making routes to multiple countries such as Australia, France, Iran, South Korea and New Zealand. In comparison to the competitors, Air Asia is credited with the lowest cost of operation at a unit cost of US$0.023 per available seat kilometer (ASK) and a passenger breakeven load factor of 52%. Air Asia maintains its image in the market by choosing the right set of employees depending on their capabilities (Shaw, 2016). Moderate Portion of buyers expend on airline. Their slogan Now Everyone Can Fly itself sets the tone for the brand. It is an international airline that began operations in Malaysia and has since expanded to include countries across the Asian continent, such as India and Thailand. Do you have a 2:1 degree or higher? It is an international air travel carrier that started its flights in Malaysia and expanded its base globally. The company is constantly using innovative solutions to provide low-cost transportation. Since AirAsia is a low-cost airline and the Indian market is price-conscious, it would be a win-win situation for both. AirAsia has the vision to be one of the best and largest airlines that operates at a low cost. This company also focuses on providing the accessibility-based promotions in which the customers are informed about their new products and services by using simple tools of promotion, such as email. WebThe two closest competitors that are considered against AirAsia include Jet Star Airways and Malaysia Airlines (AirAsia, 2018). However, the company has employed more than20,000employees to manage its worldwide operations. Malindo will compete against AirAsia on all three routes. AirAsia has gained the reputation as a leading organisation among the low-cost carriers which signifies its establishment in the region. Here are the weaknesses in the Air Asia SWOT Analysis: 1.Not on too many routes as compared to market leaders 2.Stiff competition in its sector. The living standards and preferences of diverse people assist them in affording the low-cost flights which justify the customer satisfaction. Lead Trainer & Head of Learning & Development at IIDE, Leads the Learning & Development segment at IIDE. In the context of this fact, the loyalty of the customers of Air Asia has been decreased because of the increasing competitors of Air Asia in the airlines, such as Jet Star and Tiger Airways. WebCompare AirAsia against competitors. Furthermore, AirAsia adopted a fare structure, according to which, the people who book tickets earlier will get a cheaper fare (AirAsia, 2018). However, AirAsia provides service packages to its customers at a very reasonable charge that is affordable to the customers in comparison to the competitors in the airline industries. This section covers SWOT Analysis, Competitors, Segmentation, Target Market, Positioning & USP of more than 2500 brands from over 20 industry sectors. There are many services that are provided to the employees of the organisation, such as training and motivational lectures. Market segmentation is the concept where the potential target customers for any organisation are divided into groups or segments based on various characteristics. Hi, I am an MBA and the CEO of Marketing91. In the similar context, Air Arabia provides the facility of carrying extra baggage for passengers, and this makes Air Arabia a preferred choice over Air Asia. There are several brands in the market which are competing for the same set of customers. In addition, rates are determined by the class of flight, airline load factors, travel dates and days, and competitor pricing in the airline industry. However, there is also a barrier to the establishment of the new entrant in the airlines, which is the high start-up cost that is required for the airline services. Now, the brand should amplify its marketing and promotional campaigns to attract the Indian price-conscious market. Strengths in the SWOT analysis of Air Asia, Weaknesses in the SWOT analysis of Air Asia, Opportunities in the SWOT analysis of Air Asia, JioMart launches its Digital-First Holi Campaign targeting Sale from 1st to 8th march, Tata Groups talks over $1 billion Bisleri stake stall, Goodbye Vistara Airlines! Thailand s market currently has just two local LCCs, Thai AirAsia and Nok Air. Some of the key weaknesses of Air Asia are: Opportunities refer to those avenues in the environment that surrounds the business on which it can capitalize to increase its returns. Thai AirAsia faces new competitive threats in Thai Lion and Thai VietJet. See insights on AirAsia including office locations, competitors, revenue, financials, executives, subsidiaries and more at Craft. Low Cost Model: Low cost operations and fixed costs . AirAsia was bought over by Tony Fernandes, the current chief executive officer of AirAsia from DRB-Hicom on 2nd December, 2001 (Soon, 2017). For example, they had a #responsibletraveller campaign on Instagram. AirAsia offers the cheapest flights to over 120 destinations across Asia and Australia (AirAsia, 2018). Human resource management undergoes significant political pressure as the recruitment process of AirAsia is focussed on the racial determination of the applicants rather than their merits. Air Asia is a low-cost airline headquartered in Malaysia. They have official handles on all major platforms but for the purposes of this segment, we shall take a look at the main 3, which are Instagram, Twitter, and Facebook. They have been a major player in the low-fare airline industry and have connected over 88 countries together. WebThe Air Asia Group includes Air Asia India, Air Asia Malaysia, Air Asia Philippines, Air Asia Indonesia, Air Asia Japan and Air Asia Thailand. Marketing mix 7 Ps and SWOT analysis can improve the brand value of AirAsia and identify the strengths and weaknesses of AirAsia along with determining the future opportunities. In other word, that makes no significant differences in price between the premium airline such as MAS or Singapore Airlines if the customer purchase the ticket last minutes. Strengths are defined as what each business does best in its gamut of operations which can give it an upper hand over its competitors. AirAsia is a global airline with operations in more than 160 destinations in 25 countries. Below are the top 3 competitors of Air Asia: 1. The opportunities for any brand can include areas of improvement to increase its business. Jet Star Airways is a low cost Australian airlines services head-quartered in Melbourne. AirAsia is already trying to achieve that by expanding their facilities to hotel bookings, tour packages, etc to try and gain some competitive edge along with diversifying their product portfolio. Similarity in product offering. Following are the opportunities in Air Asia SWOT Analysis: 1. Get best assignment helper in Malaysia as offered by Student Life Saviour to ensure best grades in all Malaysian assignments. Due to few suppliers in market, this has increasing the bargaining power of supplier. Below are the Strengths in the SWOT Analysis of Air Asia : 1. Direct competitors market the same product to the same audience as you, while indirect competitors market the same product to a different audience. The airline claims No Admin Fee, but all the services provided by AirAsia are not free, it has some fees for some services. The case involves the SIA introduced 2 budget airlines; ValuAir and Tiger Airways.. The company AirAsia, demographic segmentation is preferred. It works towards providing the highest quality products by making technological advancement to reduce cost and enhance service levels. The introduction of ASEAN open skies policy facilitates opportunities for expansion and generalised airline regulations among the south-east countries of Asia which would benefit the organisation. Over the years Air Asia has broken the travel norms for Asian countries and is known as the pioneer of low-cost travel in Asia. Here you can choose which regional hub you wish to view, providing you with the most relevant information we have for your specific region. Low switching costs. The bargaining power of buyers is strong when the switching cost of airlines is low. In this strategy, the company uses activities such as inbound logistics, where all the aircrafts are of one type; hence, reducing the maintenance cost, scheduling cost, and cost of managing inventory. The company makes use of innovative solutions in order to provide low-cost aviation. It would be a strong competitive edge to AirAsia after the pandemic ofcovid-19because the purchasing power of the people has dropped significantly. The route network of AirAsia is one of the largest in the world, which covers more than 20 countries all around the world. This isbecauseof increased globalisation among industries and travelling, and the tourism industry has been severely affected by it. Well established LCC operating out of South East Asia, 3. Features, such as improved WIFI and other entertainment facilities, can be improved with the help of latest trends and technologies in the IT industry. AirAsias mainproducts and servicesare KL Syariah Index of Bursa Malaysia, low price Santan meal, and duty-free merchandise, drinks, food, and other menus if you buy on board. The companys primary focus is to build customer value. It has a fleet of over 70 aircrafts, which fly to over 120 destinations and operates over 400 flights daily from its hubs situated in Thailand, Malaysia and Indonesia (AirAsia, 2018). Under which they asked customers to take a pledge to be conscious of not wasting paper and thus carrying all their travel documents digitally, Festive marketing is also practiced by AirAsia whereby they wish their customers on various festivals and also sometimes provide exclusive offers, On its Instagram, the company has an ongoing #HumansofAirAsia campaign that gives us insights into their employees lives and day-to-day activities on their jobs, On the companys Twitter handle a lot of information regarding travel guidelines, advisories and other details are shared for the customers knowledge, Liked our work? The company has partnered with the worlds most famous maintenance providers to ensure its passengers safety. Air Asia uses direct sales methods, such as sales through the internet, call centres, and walk-in airport sales. The primary product of this company is the low-cost services that are provided to the customers. Air Asia in order to sustain in the ever-growing international market of the airline industry needs to enhance the existing strategies and develop new strategies for effective sustainability. Air Asia operates flights to around 165 destinations that include both domestic and international with a fleet size of 92. I am a Digital Marketer and an Entrepreneur with 12 Years of experience in Business and Marketing. The portions of income of an individual earns is the factors because when the portion is high, the more customers will look for cheaper price, hence the bargaining power of buyers will be strong. The large fleet size and the high number of destinations help the company to diversify its resources and amplify its target market. Air Asia has expanded their product line by not only sales ticket but also offering tourism package which is offering hotel booking while booking the ticket. Some important factors in a brand's strengths include its financial position, experienced workforce, product uniqueness & intangible assets like brand value. AirAsia should expand into more countries, increase the market, and target new customers. Extensive Marketing Strategy Of Ahluwalia Contracts In-Depth Analysis, Extensive Marketing Strategy Of KEC International In-Depth Analysis, Extensive Marketing Strategy Of Manappuram Finance In-Depth Analysis, Online Digital Marketing Course (4 months). It provides an understanding of the company's strengths, weaknesses, opportunities, and threats (SWOT) in relation to its competition. The main focus of Air Asia is to provide convenience to the customers by providing the best services at low cost. In addition to this, the IT management of AirAsia adopts precise and effective approaches to ensuring the convenience of its customers (AIRASIA.COM, 2017). Any opinions, findings, conclusions or recommendations expressed in this material are those of the authors and do not necessarily reflect the views of UKEssays.com. This increases the probability of people to avail of airline services frequently. WebAirAsia is largest player in June, with 35% capacity market share Indonesia: Easing restrictions as the country step into transition period. The company will increase the current IT facilities used in the aircrafts to enhance the facilities provided to the customers. The Essay Writing ExpertsUK Essay Experts. Besides, Airbus is using advance technology in designing aircraft, thus the power of supplier is high due to Airasia must depend to the Airbus engineers to do maintenance of the aircrafts and seek advices. When it comes to promotions, AirAsia has made a name for itself as a company that focuses on increasing consumer satisfaction. Continue reading more about the brand/company. Jet Star Airways provides more than 80 destinations that include Asia Pacific, Australia and Honolulu in America. The content on MBA Skool has been created for educational & academic purpose only. Learn how your comment data is processed. Switching Cost is low. In contrast to this, AirAsia is offering more than 130 destinations that include the Middle East, Honolulu and the Asia Pacific. The threats in the SWOT Analysis of Air Asia are as mentioned: 1. AirAsias marketing strategy has worked wonders for the company in communicating exactly what they wanted to the customers. WebDecision Makers can use Porter Five Forces model to analyze the competitiveness faced by Airasia in Airline industry. Brands, such as Jet Star Airways and Tiger Airways, are sustaining in the competition as they also provide air transportation at cheap costs to people along with enhanced in-flight services and varied options for passengers.This directly affects the customer strength of Air Asia, andthese companiespose a threat to the company. Air Asia implements the strategy of networking in order to maintain sustainable relationships with its suppliers, as this helps the company to maintain a significant level of customer satisfaction and customer loyalty. Like Manchester United, Queens Park Ranger, Jamshedpur FC, Singapore national football team, Malaysia national football team, and others. The focus of AirAsia was on maintaining its low-cost policy and in context to that AirAsia X was launched in 2007. Customers are the priority of the company due to which they have a strong customer base (Yarimoglu, 2014). This comes with a lot of competition. The basic product strategy in its marketing mix is its low-cost air services. Revenue performance has greatly improved with sales across the group up 57% this week versus the preceding week, supported by the latest In our previous article, we learned in detail about the marketing strategy of a leading global Digital Marketing Courses Across The World, Mumbai | Navi Mumbai | Andheri | Mulund | Vashi | Thane | Churchgate | Delhi | Noida | Hyderabad | Gurgaon | Udaipur | Surat | Pune | Patna | Nagpur | Lucknow | Kolkata | Jaipur | Indore | Chandigarh | Ahmedabad | Nigeria | Dubai | Abu Dhabi | Egypt | Nepal | Malaysia | Sri Lanka, Geographic segmentation- AirAsia caters to mainly the Asian market, hence the name Air Asia. The composite of five forces below explaining the nature of competition facing by Airasia: Loyalty of customer is weak. Let us start the Air Asia SWOT Analysis: For Air Asia, SWOT analysis can help the brand focus on building upon its strengths and opportunities while addressing its weaknesses as well as threats to improve its market position. This involves a detailed analysis of their actions and how these would affect the future strategies of AirAsia Flying Low Cost with High Hopes. Jet Star Airwaysare considered as the safest low cost carriers among the 10 safest carriers in the airline industry of Australia. Physical evidence encompasses the ways in which the company can maintain their position in the industry. Porters Five-Forces Model of competitive analysis is widely implemented by most of the company to progress their strategies in many industries. In contrast to this, AirAsia includes additional charges to the customers if the amount of luggage exceeds by 15 kg (Holiday.My, 2018). Strict regulation and prioritisation by the UMNO (United Malays National Organisation) authorities to implement uniforms for the hostess. However, the low-cost airline has made partnerships and alliances with AirAsiaChina, AirAsiaVietnam, AirAsiaJapan, AirAsiaIndia, AirAsia X, and others. Competitiveness Points of Air Asia. Hence the airlines companies have more sales on individuals tickets rather than the groups of customers. Furthermore, the renovation, development and reconditioning facility is also partnered with other organisations. AirAsia has expanded its routes to different countries all around the world including Indonesia, China, Singapore and the Philippines. The new handles will reflect AirAsia's brand identity and values, and make it easier for customers to connect with the airline and the super app on social media. The strengths of Air Asia looks at the key aspects of its business which gives it competitive advantage in the market. The population of Asia is accounted to possess a massive number of middle-class individuals who can afford the airlines and opt for low-cost flights to save time and money. Student Life Saviour 2022 - All rights reserved. SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. Liked our work? Their 5 main operational hubs are Singapore, Indonesia, Japan, Malaysia, and Thailand. AirAsia is involved in many Corporate Social Responsibility (CSR) activities so that it can contribute towards the welfare of the community. Luggage handling is the major factor that is considered by the customer as well as the airlines industries and in context to this fact, Malaysia Airlines provides average 15 kg of luggage, and it does not include any additional charges in case there is few more luggage than the normal capacity provided by the airlines. Apart from that, AirAsia engages in popular promotions such as social media advertising, print advertisements, and simple but efficient billboard advertising. Government regulations are strict. Exit Cost is high. Such events and teams have got millions of fan following, when an airline sponsors a team or an event, then it allows the company to reach new customers. Performance of rivalry. Premium airlines, such as Singapore Airlines and Cathay Pacific, taking advantage of the healthy macro-economic variables in In addition to this, various political factors can be highlighted by influencing the operations and management of AirAsia which have been mentioned below. This has been possible through excellent brand positioning. Focusing on providing air travel without frills at substantially lower prices, AirAsia has managed to achieve lower prices to attain high passenger loads, market share, and profitability by eliminating provision of Ahsan Ali Shaw is an accomplished Business Writer, Analyst, and Public Speaker. The company believes that customers are the key to their expansion along with their growth. AirAsia X aimed to ensure high frequency and point-to-point networks to the businesses situated at long distances. AirAsia launched AirAsia Berhad in 2001, which provides air transportation services, particularly in Malaysia. Air Asia is known for treating its employees and customers well. It was started in 1993, and the operations began in 1996. SWOT analysis of Air Asia analyses the brand by its strengths, weaknesses, opportunities & threats. The 7 Ps of the model are price, product, promotion, place, people, process, and physical environment (Fine, 2017). AirAsia focuses on providing guests with comfort through competent facilities that meet industry standards, as well as regular flights and secure point-to-point connectivity. The complaints received by the organisation are identified to be the consequences of low prices as the organisation may face critical problems in ensuring service and assistance with the low-cost flights. tcu cheer roster 2020, housatonic house restaurant seymour, ct,

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