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2.1.2 Pest Analysis PEST analysis is a useful tool for scanning the general environment. The major competitors for Air Asia as per the market analysis are Jet Star Airways, Tiger Airways, JAL Express, and Air Arabia. Continue reading more about the brand/company. Airasia may be small portion of customer whom orders 200 aircraft from the total 9,113 aircraft order from other customer of Airbus. According to an estimate, theannual revenueof AirAsia in 2020 was2844million MYR, and it has declined by76.02%. Lets take a look at AirAsias marketing mix. 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). The cost may include staff retrenchment fee, paying off the loan or debts and refunds due to flight cancellation so it may expensive for an airline company to leaving the industry. 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. The acronym refers to political, economic, social and technological factors. The biggest competitors of AirAsia though, are Malaysian Airlines and JetStar Airways. AirAsia focuses on delivering accessible promotions, in which customers are aware of new product offers with minimal company intervention through simple tools such as emails. In order to build buzz, cheap flight tickets are given out based on demand in the form of promotional schemes. 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. WebAirasia are now facing competition with approximately 59 low fares airline such as JAL Express, Tiger Airways, Air Arabia, JetStar Airways, and etc. The threats in the SWOT Analysis of Air Asia are as mentioned: 1. The basic product strategy in its marketing mix is its low-cost air services. This marketing mix 7 Ps model is used to explain the marketing strategy of Air Asia. It seems as the destination and customer market share of AirAsia is only limited to the Asian countries. This company also operates through affiliated airlines, such as Thai Air Asia, Indonesia Air Asia, Philippines Air Asia. Business is my passion and i have established myself in multiple industries with a focus on sustainable growth. Lets see how they compare amongst a few key indicators. It must have a good relation with hotels and tourism companies around Asia. Continue reading more about the brand/company. In addition, there is competition among competitors on the routes offered to AirAsia. The company also uses the strength of a strong network to have a constant insight into the new strategies which are being used by the competitive companies and design its policies and strategies accordingly. *You can also browse our support articles here >. Use fundamental and technical analysis of AirAsia Group and its peers Please click here if you are not redirected within a few seconds. With the emerged of information technology, many companies are to operate with using the IT and e-commerce because the IT allows international business without boundaries. It employs an anchor pricing policy, which establishes a baseline for pricing all AirAsia-operated flights. As there are adequate options available for passengers to choose from, at the similar price as Air Asia, the company needs to focus on the amenities and hospitality services it provides to the customers. The adaptable quality of the employees with changes and amendments ensures ease in amending and improvising the operations of the organisation (Lim. The focus of AirAsia was on maintaining its low-cost policy and in context to that AirAsia X was launched in 2007. WebThe Competitors analysis of AirAsia Flying Low Cost with High Hopes looks at the direct and indirect competitors within the industry that it operates in. 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. Do you have a 2:1 degree or higher? 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. 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. The airline has four subsidiaries including Air Asia X, Indonesia Air Asia X, Indonesia Air Asia and Thai Air Asia. According to a report by The New York Times in 2007, it described AirAsia is the low-cost pioneer in the airline industry. 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. 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. 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. Moderate Portion of buyers expend on airline. AirAsia is a low-cost multinational Malaysian airline. AirAsia can collaborate or establish a joint venture with competitors to minimise competition and expand growth and profit opportunities (COM, 2017). AirAsia X has amplified its profit-making routes to multiple countries such as Australia, France, Iran, South Korea and New Zealand. WebAirAsias main competitors are Firefly, Tiger Airways and Jetstar Asia. The following are strengths and weaknesses of AirAsia: 1. In this section of the blog, we shall understand AirAsias marketing with the help of its STP (segmentation, targeting, and positioning) strategy. As there are no significant differences in the price compare to Air Asias competitor such as Tiger Airway and Jet Star as mentioned earlier, their customer do not need to spend more to shift to another airline. The increasing cost has made it impossible for the company to offer low prices and remain profitable. The airline offers400destinations both local and international in25countries across the world. The company makes use of Yield Management System (YMS), Customer Reservation System (CSR) and Enterprise Resource Planning (ERP) system, which makes it more effective in providing its services, reduces overall cost, and eliminates inefficiency in their business. The microenvironmental analysis for any company or organisation is performed using Porters Five force model. 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. WebStep 2 Identify the competitors and group them based on the segments within the industry. The following are the strengths of Air Asia : Weaknesses are used to refer to areas where the business or the brand needs improvement. Comment * document.getElementById("comment").setAttribute( "id", "a896926ff00456d33666396e451bba6e" );document.getElementById("i2e65971ac").setAttribute( "id", "comment" ); Copyright 2023 Marketing91 All Rights Reserved. The marketing mixs 7 Ps model is a marketing strategy tool that is used in a business in order to gain the feedback from the market in relation to marketing objectives. The major reason is that the number and type of competitors remain the same for a long time,and this reduces the chance of an airline company at a lower level coming higher in the market.Different airline brands are known for various services, for instance, JetBlue is known for the quality of services and amenities and Air Asia is known for its low cost. AirAsia X was regarded as having the worlds best low-cost airline premium seat and the worlds best low-cost airline premium cabin for five consecutive years (AirAsia X, 2018). Sponsorship is also one of the great marketing tools. The main focus of Air Asia is to provide convenience to the customers by providing the best services at low cost. Physical evidence encompasses the ways in which the company can maintain their position in the industry. Along with these improvements, if AirAsia continues to deliver to its target market effectively, it will surely maintain its differentiated position in the industry. Air Asia operates flights to around 165 destinations that include both domestic and international with a fleet size of 92. Government regulations are strict. In addition to this, various political factors can be highlighted by influencing the operations and management of AirAsia which have been mentioned below. The route network of AirAsia is one of the largest in the world, which covers more than 20 countries all around the world. The airline which was set up in the year 1993 started operations in the year 1996 and is thus a fairly new airline. 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 Air Asia is one of the leading brands in the airlines sector. Do check out our Free Digital Marketing Masterclass by Karan Shah. Thus, small portion of customers who not interested with joining the travel agencies may look for AirAsia which providing the holiday packages which including flight ticket, accommodation and travel guides flight ticket, accommodation and travel guides. AirAsia has also expanded its social media presence across other platforms including YouTube (@airasia), Twitter (@airasia), Weibo and WeChat. The company also engages in direct service development strategy by treating employees as an essential part of the organisation. I am a Digital Marketer and an Entrepreneur with 12 Years of experience in Business and Marketing. The airline brand should exploit these circumstances. As increasing in the number of airline competitor such as Jet Star and Tiger Airways which are also promote low cost fare may decrease the shifting cost of the customer lead to decrease of Air Asias customer loyalty. No plagiarism, guaranteed! Air Asia started with only 2 Boeing 737 300 series and started their first point-to-point flights. SIA introduced 2 budget airlines; ValuAir and Tiger Airways.. The company cannot control a number of charges and costs which are regulated by government and airline authorities which may result in a significant loss in profits and consistency of the organisation. In order to stay ahead of the competition, the company needs to constantly invest in improving the additional facilities that make a difference to customers in todays times such as disposable in-flight meals, complimentary WiFi, entertainment facilities, and varied seat options. They hence practice geographic segmentation by focusing their services primarily in Asia, Demographic segmentation- Being a low-cost airline, they cater to people in the low to medium income group, Psychographic segmentation- Their main customer is the cost-conscious traveler, AirAsia provides service packages to its customers at a very reasonable charge that is affordable to the customers in comparison to JetStar Airlines, JetStar is providing more payment options or gateways to its customers, AirAsia provides services to 130 destinations as compared to JetStar which provides services only to 80 destinations, Malaysia Airlines generates 113% of AirAsias revenue, Malaysia Airlines also has fewer employees, at 7,159 compared to AirAsias 20,000, AirAsia is the low-cost airline leader in the Asian market, The company has subsidiaries in Indonesia, Thailand, the Philippines, and Japan, It boasts a fleet of nearly 300 aircrafts, AirAsias positioning is steady and consistent in being a low-cost airline. The important thing the buyers look for is the fly to destination which shows the strong bargaining power of buyers. Copyright 2003 - 2023 - UKEssays is a trading name of Business Bliss Consultants FZE, a company registered in United Arab Emirates. AirAsia is a global airline with operations in more than 160 destinations in 25 countries. The company has partnered with the worlds most famous maintenance providers to ensure its passengers safety. Features, such as improved WIFI and other entertainment facilities, can be improved with the help of latest trends and technologies in the IT industry. AirAsia is a reputed and leading Asian based airline company, which is headquartered in Malaysia by a government-owned corporation named DRB-Hicom. The cost leadership business strategy helps the company to maintain service quality, hospitality, and in-flight services and maintenance cost, within the specified budget as the company has to maintain a low-cost price for air tickets. The company will increase the current IT facilities used in the aircrafts to enhance the facilities provided to the customers. Some factors like increased competitor activity, changing government policies, alternate products or services etc. Home Samples Marketing Environment Analysis of Air Asia. The companys primary focus is to build customer value. AirAsia has 5 employees at their 1 location and RM1.84 b in annual revenue in FY 2021. Swot Analysis of AirAsia Berhad. Knowing the increase of competition in the market, AirAsia applied the adaptation process (Hanan & Freeman, 1984) by expanding its operation to long haul services to various destinations. The check-in services in Malaysia Airlines are very convenient and comfortable as compared to AirAsia. Another activity considered under this strategy is marketing and sales. As there are approximately 59 low cost airline operating in the industry,it is always easily for the customer to look for alternative. But in 1993, Air Asia was established to finally connect Asia like no other airline company. 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. AirAsia also acquired recognition for improving its supportive and constructive management, as it received rewarded by Center Asia Pacific Aviation (CAPA) as the best airline of the year. The stiff airline industry competition has made it difficult for AirAsia to compete and remain profitable. Some important factors in a brand's strengths include its financial position, experienced workforce, product uniqueness & intangible assets like brand value. A recipient of numerous awards Air Asia has been consecutively designated as the leading low-cost carrier in the Asian region. The article below lists the Air Asia SWOT, competitors and includes its target market, segmentation, positioning & USP. Today it is one of the most reputed Asia-based airline companies. In Air Asia SWOT Analysis, the strengths and weaknesses are the internal factors whereas opportunities and threats are the external factors. Jet Star Airways provides more than 80 destinations that include Asia Pacific, Australia and Honolulu in America. Due to few suppliers in market, this has increasing the bargaining power of supplier. Points to consider while selecting a topic for dissertation help. Orient Thai previously competed as a third LCC domestically but has essentially withdrawn from this market, initially shutting its LCC brand One-Two-Go in 2008. Step 3- Assess the Porter Five Forces in relation to the Airline industry and assess which forces are strong in Airline and which forces are weak. Basic things to know before seeking help in assignment. 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$ Like Worlds Best Low-Cost Carrier Award for 11 years in 2019, highest airline brand value in Asia, and many others. The Air Asia X mainly focuses on the long-haul routes (Yarimoglu, 2014). Now, the brand should amplify its marketing and promotional campaigns to attract the Indian price-conscious market. Through its efficient STP, AirAsia has been able to successfully develop its marketing strategy and make a name for itself in the market. It works towards providing the highest quality products by making technological advancement to reduce cost and enhance service levels. Air Asia Revenue : RM 10,638 million (FY 2018) (9.6% increase YoY) RM 9,710 million (FY 2017) Competitive Analysis of Air Asia SWOT PESTLE The SWOT analysis of Air Asia is presented below: Air Asia PESTLE Analysis examines the various external factors like political, economic, social, technological (PEST) which impacts its business along with legal & environmental factors. Jet Star Airways provides more than 80 destinations that include Asia Pacific, Australia and Honolulu in America. This strategy encourages the customers to choose Air Asia over any other airline company. Build a competitive intelligence sales and marketing strategy based on the data Here > amending and improvising the operations and management of AirAsia was on maintaining its low-cost Air.. Threats are the strengths and weaknesses of AirAsia is the fly to destination which shows the strong bargaining power buyers... 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