WestJet’s competitive priority relates to cost, quality and delivery. Cost – WestJet has been able to reduce its operating costs through standardization. By purchasing only one type of plane WestJet is able lower both maintenance and training costs, resulting in higher profits. These savings and profits allows WestJet to provide lower cost airfares to its customers, thereby having a competitive advantage over its competitors. Quality – WestJet’s culture emphasizes a fun and friendly atmosphere for all travellers and empowers employees with bottom-up management.
The first thing the airline must do is look at the firm supply. If they are to continue the flights from those two hubs then they must determine if at some point in the long run the firm must be profitable or should exit the market. (Brickley et al., 2009, p. 181) Since I would assume that the costs of that route would be quite high it would appear that it would be extremely difficult for them to make a profit especially since there are lower cost airlines that customers could do business with. A competitive firm should produce
The consumer buys the portion of ownership over the jet and can then decrease travel time while increasing comfort and broader airport access. Founders of Netjets Inc. implemented blue ocean strategy in this case, finding an "untapped" market void of competition- partial private jet ownership. Consumers find this service more expensive than flying commercially,
Marketing Strategy Relationship marketing is the current marketing strategy Classic Airlines is using. The goal of relationship marketing is to build lasting relationships between the company and its customers (Kotler & Keller, 2006). The Classic Rewards Program has been Classic Airlines primary method of implementing their relationship marketing strategy. This program uses discounts on seat
Both airlines adopted the business model of Southwest Airlines in the U.S. of cost reductions. Southwest flies point-point versus a hub, and utilizes much greater efficiency and turnaround time at the airport thus maximizing aircraft utilization. Both Easyjet and Ryanair operate a younger fleet than Southwest, average age of about 5.5 years compared to 11.7 years for Southwest, ideally resulting in lower operating costs with newer more fuel efficient aircraft (AirlineFleets, 2014). Easyjet’s operations differ from Ryanair in a few key areas. Easyjet flies to mostly primary airports, where Ryanair flies to secondary airports to further cut costs (Easyjet/Ryanair, 2014).
There are several options available for customers to choose in this industry because the standard product and service are in this industry, so customers are more care about the price. And also the Internet makes customers research cheaper flight much easier than before and switching cost is low. The threat from substitute is high. Numerous options for customers can instead airlines, such as trains, buses, boats, and personal vehicles. Customers usually desire a cheaper way to travel if there are many options for them.
This will help to recapture profit margins lost to inefficiency and make them better competitors in their chosen market, (Russell & Taylor, 2011). b) Economies of Scale in material purchasing: Albatross
They offer their clients cost saving solutions to overseas flights as well as time and money as they offer a choice of best value flight fares and routings suited to the client’s itinerary. | National agencies description and Organisation example: | National business travel agents operate from one country, but they have braches in other countries as well. For example Flight centre is a national agency that is an Australian retail travel company, but they have many branches in the UK and target small and medium enterprises. They try to meet the needs of business travellers as well as leisure
The resources and capabilities that are critical to Southwest Airlines operations include a no-frills flight service to lower costs and minimize turnaround times, a family type corporate culture that ensures employee satisfaction and a frequent flyer program that retains loyal customers while adding new ones. These resources and capabilities are difficult to imitate by competitors which gives Southwest its sustainable competitive advantage. Southwest operates a linear route structure (point-to-point) through less-crowded secondary hubs in order to avoid flight congestion and high costs that are associated with primary hubs. This strategy perfectly caters to frequent business and leisure travelers who are willing to forego the frills offered by Southwest’s competitors for cheaper tickets. Southwest uses only Boeing 737 model planes for their flights, the usage of 737’s only reduces plane maintenance time and avoids delays.
The core feature of Wal-Mart’s strategy is overall low-cost leadership. According to the text, cost leadership is a lower-cost competitive strategy that aims at the broad mass market and requires “aggressive constructions of efficient-scale facilities, vigorous pursuit of cost reductions from experience, tight cost and overhead control, avoidance of marginal customer accounts, and cost minimization in areas like…” It attracts a broad spectrum of customers by supplying a wide selection of the lowest-cost general merchandise. When it comes to marketing your business, there are three generic strategies you can use: focus, differentiation and cost leadership. While the cost leadership strategy can be highly successful, it can be quite difficult to employ. It involves marketing your company as the cheapest source for a good or service.