The company will increase the current IT facilities used in the aircrafts to enhance the facilities provided to the customers. It is the largest airline company based on the concept of the Low-Cost Carrier (LCC) (Zhang et al., 2017). Lets get into discussing their marketing efforts, starting with their marketing mix. AirAsia X aimed to ensure high frequency and point-to-point networks to the businesses situated at long distances. - Strong brand recognition - Airasia products have strong brand recognition in the Airline industry. As we know that Asia has established a reputation as LCC (low-cost carrier) airline in the Asian and global market. The biggest competitors of AirAsia though, are Malaysian Airlines and JetStar Airways. The company also engages in direct service development strategy by treating employees as an essential part of the organisation. In contrast to this, Jet Star Airways has more types of planes that are provided to its customers that includes A320, Bombardier Q300, A321 and Boeing 787 Dream Liner; whereas AirAsia offers only two types of planes to its customers, which are A330 and A320. AirAsia has been a successful part of the airline industry for over a decade. Jetstar Airways 2. Given the current situation, in-flight experience, especially hygiene matters a lot to customers so AirAsia should heavily market its hospitality and put customers at ease in availing their services. The first decision by the Malaysian Competition Appeal Tribunal since its inception more than four years ago caught the media and publics attention. They have achieved effective targeting to this segment by making their brand synonymous with low-cost services. AirAsia offers the cheapest flights to over 120 destinations across Asia and Australia (AirAsia, 2018). Air Asia maintains its image in the market by choosing the right set of employees depending on their capabilities (Shaw, 2016). Airasia are now facing competition with approximately 59 low fares airline such as JAL Express, Tiger Airways, Air Arabia, JetStar Airways, and etc. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); This site uses Akismet to reduce spam. Thank you very much Mr. Hitesh Bhasin for this SWOT analysis. AirAsia is a global airline with operations in more than 160 destinations in 25 countries. AirAsia Berhad also facilitates in operating businesses, related financial services and airline operation services. 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. But of course, there exist many competitors that require constant evaluation of strategies. Web- High margins compare to Airline industry's competitors - Even though Airasia is facing downward pressure on profitability, compare to competitors it is still racking in higher profit margins. The importance of pricing strategy is to know the strategies that are used in the market and to analyse the rivals that are present for Air Asia n the airline industry (Shaw, 2016). Liked our work? Air Asia is smartly using its social media in building a direct relationship with its customers. 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. 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. Air Asia is known as one of the most low-cost airlines in the airline industry. 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. in the worldTherefore, in the increasingly competitive market, AirAsia flies to more number of destinations in comparison to its competitors. The diversity results in critical issues and problems for AirAsia to manage and operate all its functions accordingly. Today, it connects domestic and international flights to more than 165 destinations within 25 countries. Air Asia can also implement a cost leadership business strategy. The increasing traffic from India and Indians prefer budget airlines as they are cost conscious 2. Air Asia Competitors There are several brands in the market which are competing for the same set of customers. Hence, customer may access to the current airlines information which are available at all time, this has reduced the power of negotiation for airlines and producing a strong customers bargaining power. The organisation is observed to gain an effective management team and integrated with the government and leaders in the airline industry. The distribution channels for the tickets include different sources such as internet ticket booking, exclusive reservation, and sales offices along with the agents that are authorised by the company. The overall services that are provided by Malaysia Airlines and AirAsia have a tremendous difference. This section covers SWOT Analysis, Competitors, Segmentation, Target Market, Positioning & USP of more than 2500 brands from over 20 industry sectors. Diversified in product offered. Air Asia started with only 2 Boeing 737 300 series and started their first point-to-point flights. I am a Digital Marketer and an Entrepreneur with 12 Years of experience in Business and Marketing. Following is the SWOT analysis of AirAsia: Lastly, lets take a look at AirAsias social media marketing presence as digital marketing is also a very important part of any companys marketing strategy. 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! 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. Physical evidence encompasses the ways in which the company can maintain their position in the industry. 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). Although the two major suppliers of aeroplane structures are Airbus and Boeing, the suppliers of other facilities required in an aeroplane, for hospitality services including food and merchandise, are available in adequate amount in the market. WebFive steps to successful analysis of. Here you can choose which regional hub you wish to view, providing you with the most relevant information we have for your specific region. Increasing globalisation has led to an increase in the lifestyle and financial condition of people. As per the results of the survey, AirAsia has. Furthermore, Jet Star Airways has comparatively more number of payment options that are available for the convenience of the customers (Finder, 2018). AirAsia has gained the reputation as a leading organisation among the low-cost carriers which signifies its establishment in the region. Our academic experts are ready and waiting to assist with any writing project you may have. 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: Multiple ticket distribution networks exist, including internet booking, exclusive reservations, sales offices, and company-approved agents. Disclaimer: This is an example of a student written essay.Click here for sample essays written by our professional writers. gained a smart rating of 54 whereas Malaysia Airlines has gained the rating of 85 which, signifies the contrast of both the airlines in terms of acceptance of the services and feedback by the customers (Holiday.My, 2018). Relative Price. Another reason for the threat of new entrants being low is government laws and regulations which pose restrictions on applying for permissions and license for operating an airline company. 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. Due to few suppliers in market, this has increasing the bargaining power of supplier. Apart from that, AirAsia engages in popular promotions such as social media advertising, print advertisements, and simple but efficient billboard advertising. Some factors like increased competitor activity, changing government policies, alternate products or services etc. Furthermore, landing charges can be identified as the negative aspect resulting into underdevelopment of the airline industry as the aviation sector is strictly obligated to abide by precise air rights regulations and norms. AirAsia is involved in many Corporate Social Responsibility (CSR) activities so that it can contribute towards the welfare of the community. Here you can choose which regional hub you wish to view, providing you with the most relevant information we have for your specific region. 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. Through its efficient STP, AirAsia has been able to successfully develop its marketing strategy and make a name for itself in the market. WebAirAsias top competitors are Air India , American Airlines, Emirates Airlines , British Airways , Delta Airlines, Tiger Airways, Silk Air, Jetstar Airways, and many others. Back in the 1900s Thai National Airlines was the only airline that could fly in the main routes of Bangkok Chiang Mai with non-stop flights. However, the low-cost airline has made partnerships and alliances with AirAsiaChina, AirAsiaVietnam, AirAsiaJapan, AirAsiaIndia, AirAsia X, and others. Air Asia operates flights to around 165 destinations that include both domestic and international with a fleet size of 92. Their 5 main operational hubs are Singapore, Indonesia, Japan, Malaysia, and Thailand. For example, they had a #responsibletraveller campaign on Instagram. Revenue performance has greatly improved with sales across the group up 57% this week versus the preceding week, supported by the latest Similar service provided among every airline company so the competitive may be fierce. Well established LCC operating out of South East Asia, 3. Low switching costs. They truly contribute their lifelong learning in allowing students to succeed in their academics. 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 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. Due to competitive in airline industry and protects on national airline, MAS which facing losses in these year, it is quite difficult to apply for licensing and permit for operating airline company. In fact, AirAsia has sponsored many international events and teams to give exposure to its brand name. Your email address will not be published. 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. AirAsia is headquartered in Malaysia and provides transportation services to its passengers along with cargo and courier services. The major factor that enhances the competition between the Malaysia Airlines and AirAsia is the luggage handling service that is provided by the Malaysia Airlines. In anchor pricing strategy, the company prices its services along with the tickets at a low price. The AirAsia Big Loyalty Program is one of the companys most popular campaigns, in which affluent customers win BIG points for any purchase they make and redeem those points for free airline tickets. 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%. The weaknesses of a brand are certain aspects of its business which are it can improve to increase its position further. There are a lot of operations that are conducted by the company as it is spread across 25 countries in more than 160 destinations. Its going to analyze the internal and external factors impacting the worlds leading low-cost airline. This increases the probability of people to avail of airline services frequently. Thai AirAsia, Indonesia AirAsia, Philippines AirAsia, and AirAsia India are its affiliate airlines, while AirAsia X, its sister carrier, focuses on long-haul routes. Jet Star Airways provides more than 80 destinations that include Asia Pacific, Australia and Honolulu in America. The company is constantly using innovative solutions to provide low-cost transportation. There are many services that are provided to the employees of the organisation, such as training and motivational lectures. AirAsia uses various media platforms for the marketing and promotion of its products and services. AirAsia was named as the best low-cost airline company in the world for 9 consecutive years at the Skytrax World Airline Awards. AirAsia is a low-cost multinational Malaysian airline. In Air Asia SWOT Analysis, the strengths and weaknesses are the internal factors whereas opportunities and threats are the external factors. 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. According to an estimate, theannual revenueof AirAsia in 2020 was2844million MYR, and it has declined by76.02%. Competitiveness Points of Air Asia. Its routes include both domestic and international flights. 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. In addition to this, various political factors can be highlighted by influencing the operations and management of AirAsia which have been mentioned below. Porters Five-Forces Model of competitive analysis is widely implemented by most of the company to progress their strategies in many industries. Furthermore, the company wants to serve the 3 billion people who are currently out of connectivity and cannot afford high fares. Use Slintel to connect with top decision-makers at AirAsia. Ease to switching. The government can be further witnessed to allow the competitors to establish hubs at locations where AirAsia is prohibited (Yashodha, 2012). Required fields are marked *. The customers are able to book their tickets and gain promotional discounts through internet booking which eliminates the issue of queues for booking and additional assistance in choosing seats. Use fundamental and technical analysis of AirAsia Group and its peers Please click here if you are not redirected within a few seconds. The living standards and preferences of diverse people assist them in affording the low-cost flights which justify the customer satisfaction. Another strategy that the company will implement in the future is networking. This is due to Airbus is a UK based aviation company and their customer may come from around the world. Home Samples Marketing Environment Analysis of Air Asia. The purpose of this report is to examine the market environment for AirAsia, which has established its business in Malaysia. This article has been researched & authored by the Content & Research Team. Air Asia also engages itself in the promotion of the company through social media, print advertisements, and effective billboard advertising (Mele, Pels and Storbacka, 2015). 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. It constantly delivers on this promise of affordability, It is extremely difficult to keep costs as low as possible due to fluctuations in fuel prices and increases in service costs, AirAsia does not have its own MRO facility, Cut-throat competition in its sector. The major issue with maintaining low ticket price is the increasing competition in the airline industry. The company provides its services to people of every age group of society, and to the people belonging to the medium and high ranged of income or financial status. The price will be cheaper if you book earlier. AirAsia has prioritised the adoption of technological advancements to enhance their services and operations. The airline offers400destinations both local and international in25countries across the world. Tony Fernandes was recognised as for his outstanding work in AirAsia, and he was awarded by the International Herald Tribute Award and he also became the Malaysian CEO of the year in 2003 (Roy, 2014). Step 4 - Determine overall industry structure and test analysis of consistency. 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. Specific analysis has been conducted in order to analyse the market environment for AirAsia. Strong Promoter 2. The company engages in anchor pricing strategy in its marketing mix. Interested in learning more? Aircraft supplier could be the one who gaining most bargaining power as there are only two in operation, Boeing or Airbus. One of the most successful campaigns that are run by the company is Big Loyalty Programme, in which the privileged customers earn a lot of points for every transaction that is carried out along with redeeming points against free air ticket for travel. The organisational image is consistent and successful concerning the competition in the market. 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