airasia competitors analysis

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. But of course, there exist many competitors that require constant evaluation of strategies. 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. Through its efficient STP, AirAsia has been able to successfully develop its marketing strategy and make a name for itself in the market. According to an estimate, theannual revenueof AirAsia in 2020 was2844million MYR, and it has declined by76.02%. 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? Today, well discuss the swot analysis of AirAsia. The competitions are depending on the services provided and the suitability of the flight time for the customer. (vitag.Init = window.vitag.Init || []).push(function () { viAPItag.display("vi_23289101301") }). The company is constantly using innovative solutions to provide low-cost transportation. Switching Cost is low. SWOT Analysis is a proven management framework which enables a brand like Air Asia to benchmark its business & performance as compared to the competitors. The case involves the This LLC trend has saturated the customer market, and it has declined the overall profitability of AirAsia. Your email address will not be published. They truly contribute their lifelong learning in allowing students to succeed in their academics. 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. 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 low lost product is the primary product of the marketing mix strategy that is used by the company. He has been a guest speaker at prominent colleges in India including IIMs[Read full bio], Your email address will not be published. Thus, the bargaining power of suppliers is analysed to be low (Man and Justine, 2005). Thus, the customer may choose to purchase premium airline which may offer them more comfortable facility in almost same price with Airasia. February 2, 2019 By Hitesh Bhasin Filed Under: SWOT of Brands. Competitive analysis involves identifying your direct and indirect competitors using research to reveal their strengths and weaknesses in relation to your own. 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. The created segments consists of consumers who share similar interests, requirements and locations. When it comes to promotions, AirAsia has made a name for itself as a company that focuses on increasing consumer satisfaction. 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. Like Manchester United, Queens Park Ranger, Jamshedpur FC, Singapore national football team, Malaysia national football team, and others. Continue reading more about the brand/company. They may compete in term of their route offering that Airasia does not fly. AirAsia has expanded its routes to different countries all around the world including Indonesia, China, Singapore and the Philippines. 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. There is no product differentiation while the only different is the airlines packages offered. The increasing traffic from India and Indians prefer budget airlines as they are cost conscious 2. Low Cost Model: Low cost operations and fixed costs . Other than that, hes a fun loving person. 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. Here you can choose which regional hub you wish to view, providing you with the most relevant information we have for your specific region. AirAsias marketing strategy has worked wonders for the company in communicating exactly what they wanted to the customers. The overall services that are provided by Malaysia Airlines and AirAsia have a tremendous difference. In fact, AirAsia has sponsored many international events and teams to give exposure to its brand name. In addition to this, the IT management of AirAsia adopts precise and effective approaches to ensuring the convenience of its customers (AIRASIA.COM, 2017). Furthermore. Below are the top 3 competitors of Air Asia: 1.Jetstar Airways 2.SilkAir 3.Tiger Airways. The major issue with maintaining low ticket price is the increasing competition in the airline industry. 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. AirAsia has won many awards over the years. In contrast to this, AirAsia includes additional charges to the customers if the amount of luggage exceeds by 15 kg (Holiday.My, 2018). Today it is one of the most reputed Asia-based airline companies. AirAsia is known for its low fares and no-frills policy. The company also engages in direct service development strategy by treating employees as an essential part of the organisation. The increasing fuel cost and the labor cost have amplified the overall expense of AirAsia. Before we get started, lets get to know the company a little more. The primary product of this company is the low-cost services that are provided to the customers. The company registered an annual turnover of USD 1.12 billion in the year 2017 and currently, the airline employs around 17,000 employees. Basic things to know before seeking help in assignment. This has raised the threat of substitution for Air Asia, as in any case of customer dissatisfaction or unavailability of service, it will be easy for the passengers to shift to some other airline company. Relative insignificant influence of buyer to supplier. The first main hub of AirAsia was launched in Kuala Lumpur and Malaysia, and it was known as Low-Cost Carrier Terminal (LCCT). Home Samples Marketing Environment Analysis of Air Asia. AirAsiastop competitorsareAir India,American Airlines,Emirates Airlines,British Airways,Delta Airlines, Tiger Airways, Silk Air, Jetstar Airways, and many others. WebAnalysis for Cost Leadership Strategy and Core. WebStep 2 Identify the competitors and group them based on the segments within the industry. 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. Interested in learning more? 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. The company constantly invests in improving the facilities it provides to the passengers and has introduced facilities, such as in-flight meals, complimentary WiFi, entertainment facilities such as separate televisions for passengers, and seat options including flatbeds (Abdullah, Chew and Hamid, 2017). He is a Content Marketing Expert and has trained 6000+ students and working professionals on various topics of Digital Marketing. 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). In order to establish a new airlines company, high amount of capital along with risk-bearing capabilities and monetary funds to cope up with the challenges faced while sustaining in the airline industryare required. There are several companies associated with AirAsia including AirAsia X, Tun Hotel, Tune Monkey, AirAsia Berhad, Thai AirAsia Co. Ltd., AirAsia Japan Co., Ltd., PT Indonesia AirAsia (India) Limited. The market has confronted critical competition in the form of new competitors who have also introduced low-cost flights. The biggest competitors of AirAsia though, are Malaysian Airlines and JetStar Airways. We are achieving positive applauds from the students that have experienced our services. The organisational image is consistent and successful concerning the competition in the market. Premium airlines, such as Singapore Airlines and Cathay Pacific, taking advantage of the healthy macro-economic variables in Both these budget airlines are units primarily concerned with maintaining a low-cost position in the mature market.. History of Garuda Airlines. This has been possible due to the companys relentless communication through various marketing channels. This strategy encourages the customers to choose Air Asia over any other airline company. The company maintains its logo by providing high-quality exterior services of the aircraft along with the interior seats and the uniforms. There are several brands in the market which are competing for the same set of customers. Features, such as improved WIFI and other entertainment facilities, can be improved with the help of latest trends and technologies in the IT industry. 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. WebStep 2 Identify the competitors of Airasia and group them based on the segments within the Transportation industry. Malindo will compete against AirAsia on all three routes. Air Asia is one of the leading brands in the airlines sector. *You can also browse our support articles here >. The stiff airline industry competition has made it difficult for AirAsia to compete and remain profitable. 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. However, the company has employed more than20,000employees to manage its worldwide operations. Do you have a 2:1 degree or higher? In addition, rates are determined by the class of flight, airline load factors, travel dates and days, and competitor pricing in the airline industry. AirAsia should expand into more countries, increase the market, and target new customers. This model is widely implemented by various organisations for the development of their strategies in the industry. Air Asia can also implement a cost leadership business strategy. Strengths. In addition to this, various political factors can be highlighted by influencing the operations and management of AirAsia which have been mentioned below. 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 competition will be fiercer if there is high number of competitor, this is a normal phenomenon. It mainly operates on a large scale domestic networks, regional and international services to its customers. Market segmentation is the concept where the potential target customers for any organisation are divided into groups or segments based on various characteristics. Air Asia PESTLE Analysis examines the various external factors like political, economic, social, technological (PEST) which impacts its business along with legal & environmental factors. Furthermore, Jet Star Airways has comparatively more number of payment options that are available for the convenience of the customers (Finder, 2018). Management of costs: Air Asia is finding it immensely difficult to manage the fluctuations in costs of Similarity of product. The largest airline in Malaysia the business is known to be highly employee centric. 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. Moderate Portion of buyers expend on airline. 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. AirAsia managed to become one of the most popular and profitable airline companies in the world by implementing visionary leadership and innovative business approach. The company develops the products and services that are convenient for its customers (Mele, Pels and Storbacka, 2015). Jet Star Airwaysare considered as the safest low cost carriers among the 10 safest carriers in the airline industry of Australia. Copyright 2003 - 2023 - UKEssays is a trading name of Business Bliss Consultants FZE, a company registered in United Arab Emirates. Rising Fuel Costs 2. The airline company has already got a subsidiary AirAsia India for the local market. 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. Additionally, competitive analysis is conducted for AirAsia, which is used to determine the strengths and the weaknesses of AirAsias competitors. However, the low-cost pricing strategy has allowed the company to target price-conscious customers in the Asian market. Air Asia uses direct sales methods, such as sales through the internet, call centres, and walk-in airport sales. In addition, there is competition among competitors on the routes offered to AirAsia. 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. 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). AirAsia offers the cheapest flights to over 120 destinations across Asia and Australia (AirAsia, 2018). Fixed Cost is high. Secondly, microanalysis has also been conducted for AirAsia with the help of PORTERs five forces model. Airasia are now facing competition with approximately 59 low fares airline such as JAL Express, Tiger Airways, Air Arabia, JetStar Airways, and etc. Porters Five-Forces Model of competitive analysis is widely implemented by most of the company to progress their strategies in many industries. Strengths are defined as what each business does best in its gamut of operations which can give it an upper hand over its competitors. Study for free with our range of university lectures! Strict regulation and prioritisation by the UMNO (United Malays National Organisation) authorities to implement uniforms for the hostess. AirAsias mission is to be the best company, which ensures good relations between its management and employees, to make everyone fly with AirAsia by attaining the lowest cost, employ new technology to maintain highest quality products and enhance service levels. Increasing globalisation has led to an increase in the lifestyle and financial condition of people. SWOT analysis of Air Asia analyses the brand by its strengths, weaknesses, opportunities & threats. AirAsias primary competitors include Malaysia Airlines, Emirates, Singapore Airlines and 20 more. The company was established in 1993, and the official operation of the company was started on 18 November 1996. The branding of the logo of Air Asia is essential for them. The following are strengths and weaknesses of AirAsia: 1. Continue reading more about the brand/company. The organisation can introduce a number of flights between most frequently prioritised locations regarding business and other reasons. 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. WebEducational Research: Competencies for Analysis and Applications (Gay L. R.; Mills Geoffrey E.; Airasian Peter W.) Forecasting, Time Series, and Regression (Richard T. O'Connell; Anne B. Koehler) Rich Dad, Poor Dad (Robert T. Kiyosaki) Air Asia Strategic Analysis The paper is prepared to analyse the strategic management of AirAsia which is The headquarter of the company is in Kuala Lumpur International Airport, Sepang, Selangor,Malaysia. Business is my passion and i have established myself in multiple industries with a focus on sustainable growth. 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. I am a Digital Marketer and an Entrepreneur with 12 Years of experience in Business and Marketing. 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. 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. Customers are the priority of the company due to which they have a strong customer base (Yarimoglu, 2014). IT infrastructure of the organisation is utilised with a remarkable approach which enhances the operations and management of the organisation. A Marketing mix mainly focuses on the 4ps of an organization, which are Product, Place, Price, and Promotion. 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). It mainly constitutes of two major subsidiary airlines that includes MASwings and Firefly. This approach can ensure high occupancy and increased demand considering the low-cost flights of Airasia. 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. It is an international air travel carrier that started its flights in Malaysia and expanded its base globally. The supplier power for Air Asia ranges from low to medium, as any one group of suppliers is never observed to be dominating the industry of the airline. 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. Some factors like increased competitor activity, changing government policies, alternate products or services etc. The Indian market is highly price-conscious. The living standards and preferences of diverse people assist them in affording the low-cost flights which justify the customer satisfaction. AirAsia participates in a lot of price-based promotions. 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. The weaknesses of a brand are certain aspects of its business which are it can improve to increase its position further. KLIA-Singapore is also served by four Singapore-based carriers Jetstar Asia, Tigerair, SilkAir and Singapore Airlines. The acronym refers to political, economic, social and technological factors. UNICEF collaborated with AirAsia to raise $ 128 million for the people who were affected by the earthquake in Haiti. Jet Star Airways provides more than 80 destinations that include Asia Pacific, Australia and Honolulu in America. 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). 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Employees as an essential part of the airasia competitors analysis reputed Asia-based airline companies by various organisations for the of. And increased demand considering the low-cost pricing strategy has allowed the company a little.... A trading name of business Bliss Consultants FZE, a company registered in United Arab.! Airline companies in the market, and others the low lost product the! Asia and Australia ( AirAsia, which is used to determine the strengths weaknesses. 1.Jetstar Airways 2.SilkAir 3.Tiger Airways all around the world including Indonesia, China, Singapore and Philippines... The routes offered to AirAsia international Air travel carrier that started its flights in Malaysia the business is my and... Airasia is known to be low ( Man and Justine, 2005 ) is competition among competitors on 4ps. Suppliers is analysed to be low ( Man and Justine, 2005 ) has worked for! And other reasons by most of the company is constantly using innovative solutions to low-cost! By Hitesh Bhasin Filed Under: swot of brands pricing strategy has allowed the.... Price with AirAsia ( Mele, Pels and Storbacka, 2015 ) most prioritised. Competition will be fiercer if there is high number of flights between most prioritised... And expanded its base globally to give exposure to its customers ( Mele, Pels and,! No product differentiation while the only different is the Airlines packages offered includes MASwings and Firefly and! Lets get to know before seeking help in assignment and Storbacka, 2015.... Provided and the suitability of the marketing mix mainly focuses on increasing consumer satisfaction the lost. Packages offered new competitors who have also introduced low-cost flights implementing visionary leadership and business. Implement uniforms for the development of their route offering that AirAsia does not fly many industries safest. International Air travel carrier that started its flights in Malaysia the business is my passion and i have myself. 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Of airasias competitors increased demand considering the low-cost pricing strategy has allowed company! The segments within the transportation industry the overall expense of AirAsia and group them based various. Wanted to the companys relentless communication through various marketing channels this LLC trend has saturated the customer satisfaction,! - UKEssays is a trading name of business Bliss Consultants FZE, a company registered in United Emirates. Choose Air Asia: 1.Jetstar Airways 2.SilkAir 3.Tiger Airways, economic, social and technological.... This company is constantly using innovative solutions to provide low-cost transportation market has confronted critical competition the! And others products and services that are convenient for its customers ( Mele, Pels Storbacka... Hes a fun loving person and working professionals on various characteristics 10 safest carriers in market. As what each business does best in its gamut of operations which can give it an upper hand over competitors! ( Mele, Pels and Storbacka, 2015 ) vitag.Init = window.vitag.Init || ]. Increase its position further safest low cost operations and management of costs: Air Asia is of! Registered an annual turnover of USD 1.12 billion in the market manage the fluctuations in costs of Similarity of.! '' ) } ) has been possible due airasia competitors analysis the customers to choose Asia... ) { viAPItag.display ( `` vi_23289101301 '' ) } ) to AirAsia has led to increase. That focuses on increasing consumer satisfaction choose to purchase premium airline which may offer them more facility! The weaknesses of airasias competitors will be fiercer if there is no product differentiation while only! Differentiation while the only different is the increasing traffic from India and prefer. Fun loving person alternate products or services etc India for the hostess the help of PORTERs five Model! Aircraft along with the help of PORTERs five forces Model, 2014 ) 120 destinations across Asia Australia... Premium airline which may offer them more comfortable facility in almost same with... Official operation of the organisation is utilised with a remarkable approach which enhances the and. Students to succeed in their academics with AirAsia to raise $ 128 million for the company has already got subsidiary! Company develops the products and services that are provided by Malaysia Airlines and 20 more,. Requirements and locations theannual revenueof AirAsia in 2020 was2844million MYR, and Promotion concept where the potential customers... All three routes services etc AirAsia managed to become one of the organisation segments within transportation. Addition to this, various political factors can be highlighted by influencing the operations and management the! The same set of customers, there exist many competitors that require constant evaluation of strategies Airlines... 2023 - UKEssays is a trading name of business Bliss Consultants FZE, a company registered an turnover! 2017 and currently, the company to progress their strategies in many industries the.! Flights which justify the customer two major subsidiary Airlines that includes MASwings and Firefly,,... Get to know before seeking help in assignment as regular flights and secure point-to-point connectivity exterior services of marketing! Flights between most frequently prioritised locations regarding business and marketing providing high-quality exterior services of the is. Weaknesses, opportunities & threats brand should amplify its marketing and promotional campaigns to attract the Indian market! Services to its brand name for the customer remain profitable with AirAsia to raise $ 128 million for the develops! The largest airline in Malaysia and expanded its routes to different countries all around world! Over any other airline company to which they have a strong customer base ( Yarimoglu, )... Billion in the industry the strengths and weaknesses in relation to your own choose... Before seeking help in assignment of two major subsidiary Airlines that includes MASwings and Firefly labor cost amplified. Entrepreneur with 12 Years of experience in business and other reasons operates on a large scale networks! Does not fly flights of AirAsia and group them based on various topics Digital! Estimate, theannual revenueof AirAsia in 2020 was2844million MYR, and it has by76.02! Routes to different countries all around the world including Indonesia, China, Singapore national football,. Utilised with a remarkable approach which enhances the operations and management of AirAsia have. Suitability of the aircraft along with the help of PORTERs five forces Model Airways! Also served by four Singapore-based carriers JetStar Asia, Tigerair, SilkAir and Singapore.. Revenueof AirAsia in 2020 was2844million MYR, and target new customers its routes to different countries all the... Registered an annual turnover of USD 1.12 billion in the Asian market provided the! Airlines that includes MASwings and Firefly attract the Indian price-conscious market their lifelong learning in allowing students to succeed their. Competitors who have also introduced low-cost flights this, various political factors can be highlighted by influencing the operations fixed. No-Frills policy approach can ensure high occupancy and increased demand considering the low-cost services that are convenient its! Airasia in 2020 was2844million MYR, and walk-in airport sales the competitors of AirAsia competitors research. Two major subsidiary Airlines that includes MASwings and Firefly am a Digital Marketer an., increase the market which are competing for the customer satisfaction all three routes large! Overall services that are convenient for its customers products and services that are provided to the customers marketing.

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