UNIVERSITY OF SAN JOSE- RECOLETOS
COLLEGE OF COMMERCE
TOURISM AND HOSPITALITY DEPARTMENT
HOSPITALITY MARKETING MANAGEMENT CLASS
Virgin Atlantic Airways
Ariza, Gee Kylie Krishna
Chua, Zyera P.
Comar, Grace Stephanie J.
Morales, Monique Joy
Mr. Steven N. Sasam
February 16, 2010
Virgin Atlantic Airways entertains the different status, gender and age.
Most of the travelers are business traveler and leisure travelers.
They allow children ages 5-and above to travel. Below 5 years old, the kid should
have guardian ages 16 up or parents. For the unaccompanied child/children, they
must follow a certain rule. The Virgin Atlantic also accepts trained pets who
accompanied disabled person e.g. Blinds person. Also some of their passengers
are packed with friends, families and high yield business travelers.
Virgin Atlantic Airways gives importance to technology. Technology could
also upgrade the expectations of passengers. Virgin Atlantic Airways knows how
dangerous to fly the airplane without further checking of its technology. There are
aircrafts engineers that have been researching to improve security airlines. They
also implement high technologies to entertain the passengers while waiting for
arrival. They don't want the passengers feel bored during the flight.
Innovations were implemented in order for the passengers to relax and to
feel comfortable. There were video entertainment, Sony watchman on board,
individual video screens for every seat; virgin’s onboard entertainment offered 20
audio channels, 16 video channels. Those innovations were created to cater the
needs and wants of the customers as well as to understand the passengers
needs and go beyond their expectations. They accept any status of passengers.
In January 1991, the UK opened Heathrow Airport to Virgin when it
abolished the London Air Traffic Distribution Rules in response to pressure from
the industry. The London Air Traffic Distribution Rules had come into effect in
1978, originally created to achieve a fairer distribution of traffic between
Heathrow and Gatwick, the UK's two main international airports, to help Gatwick
make a profit.
The former rules stated airlines without an international scheduled service from
Heathrow prior to 1 April 1977 would not be permitted operations there; instead
they would have to use Gatwick. Before the abolition, airlines that did not already
operate at Heathrow could commence domestic scheduled services there
provided BAA, which ran both Heathrow and Gatwick on behalf of the
Government, and the Secretary of State for Transport, granted permission.
The economic issues in the industry are also mostly concerned with
deregulation. The evolution of industry structure plays an important role in
determining the robustness and stability of lower air fares in unregulated
markets. Deregulation keeps airline fares so low as compared to that of other
countries. The reason for this is because despite the failure of most entrants
since deregulation, investors continue to create new airlines.
Market implications: lowered their airline tickets; discounts for senior citizens;
discounts for group travelers.
Virgin Atlantic Airways have quality staff despite of low income. Virgin
Atlantic’s employees should have the sense of responsibility in entertaining the
passenger’s needs and wants. Branson wanted that their customers also feel the
belongingness in the industry. The crew should also have the sense of fun.
Sense of fun that while the crew have to work hard, they should have fun and
should be satisfied with what they do and what to offer for the passengers.
Virgin Atlantic is committed to reducing our environmental impacts
where we can by becoming a more efficient business, leading the industry to
practical and technical solutions and engaging, inspiring and empowering our
staff and customers to help us meet this challenge.
Together with Virgin Atlantic's biofuel demo and push for more efficient aircraft
this is the sort of initiative the airline industry needs at a time when emissions
from this sector are growing at nearly 4% a year.”
• The dedicated emphasis • The increasing number of
on customer service and travelers in the UK is also
innovation an opportunity for Virgin
• It is headquartered in a Atlantic.
country where airline • There might have a push
competition is tolerated on the market with its
and enhances because latest Heathrow
of the deregulation clubhouse.
• Lacks transparency • The emerging consumer
unlike other Companies mindset thus it is
UK and around the dangerous to ride airlines
world. because they are
• Virgin Atlantic reach only susceptible to terrorist
limited countries unlike attacks.
other global airlines. • Emergences of new
• The company has limited airlines, as there are
destination. newly formed ones using
SUPPLIERS INDUSTRY Buyers
The airline industry is saturated. In a country, it can have more
than five airlines, which also compete against each other. Since travel services
are derived demand, new entrants should be able to cut a share in the pie in the
presently saturated market. Virgin Atlantic Airways, a company with a good
background in the industry and they are also backed up by Singapore Airlines.
The main supplier for airlines is obviously its aircraft manufacturer. In
Virgin Atlantic case, the main aircraft manufacturers are Boeing and Airbus. Fuel
companies are also one of the key suppliers for airlines, since fuel is the basic
necessity for aircraft in order to operate. the airport itself supplies the services
needed by aircrafts. IT companies such as IBM and NCR can be classified as
suppliers as they supply IT solutions.
The competitions are very stiff at this point, because of the reduced of the
government role and protective rules that lead to the increasing competition
among airlines. Competitors in the industry have same capability in terms of
interactivity of their web page. The core competence of the Virgin Atlantic
Airways is their high technologies, cheap ticket and good schedules.
Virgin Atlantic Airways is known for the quality service render to their
passengers. The Virgin Atlantic Airways offers the cheapest airfare so that the
passengers can afford.
Passengers were used to purchase their tickets directly from the airlines
company. At that time, bargaining power of customers was very low, but now
every airline spreads its distribution channel everywhere even overseas to keep
up with the competition. This enables the airlines to cover the market, but on the
other hand it also grants bargaining power to the buyers.
For every product or service a company offers, there is always a
potential of a substitute for it. Virgin Atlantic Airways operates completely in air
transportation. Air transportation is utilized by people who need to travel faster
and time efficiency is crucial for them. If time is not a main consideration, people
might choose to travel by sea or land and this saves them a lot of money. The
main substitutes for airline industry are trains, buses and ships.
STATEMENT OF THE PROBLEM
How will Virgin Atlantic Airways segment and position their
firm in the market min order for them to surpass their competitors and
become a market leader?
Virgin Atlantic airways were founded by Richard Branson. Richard
Branson believes knowing the needs and wants of the customers are the best
core competence to them. By this way, the company can target all the market.
The virgin Atlantic believes that they need to accommodate all potential
customers for as long as they can afford unaccompanied children, male and
female, employed or unemployed, and their different purpose of travels. The
virgin Atlantic Airways don’t practice the marketing segmentation
How the Virgin Atlantic maintain their good reputation and their services?
The Virgin Atlantic Airways is known for its high technology, offers
a best fares and schedules, comfortable seats than other airlines their
entertainment system is the best among the others. Passengers expect what
they saw in the websites and also in the magazines. A passenger expects good
employees as well. But there are more unsatisfied passengers who commented
in the internet about the Virgin Atlantic. The virgin Atlantic airways offers a best
fares and schedules, the seats are much more comfortable than the most
airlines, their entertainment system is better than anyone else. But unfortunately,
the seats are tiny with absolutely no leg room in the premium economy class.
The seats recliner button broke. Passenger’s comment about their services and
staff. Some of these are: lousy services, uninformed and uncaring employees,
arrogant staffs, unprofessional, incredibly rude ground staffs, over-booked flight,
inattentive attendants; they take no responsibilities for their mistakes. And they
call their passengers foul names.
Presentation of the alternatives
Alternatives A for primary problem
Virgin Atlantic Airways cannot serve all customers in a broad
market. The company needs to identify their target market so that they can serve
and do their job effective and efficient. Virgin Atlantic can apply the mass-market
strategy. The mass-market strategy call on a firm to develop one product the is
marketed to all potential consumer this approach considers the market segment
with similar wants and needs of the customers.
Alternatives B for primary problem
Alternatives A for Secondary problem
Virgin Atlantic Airways are known for their state-of-the-art facilities
and their low price but there are still unhappy passengers because of some
failures of their facilities which are not operating well. The main goal of the
company is to give “Upper Class service in a low cost”.
The management must check their equipments and facilities
before and after the flight. So that the management can fix it ahead of time and
also to avoid customers complaints. If the entertainment games is not available
and must be fix for a longer time, they must informed the passengers about the
problem and instead of on flight games, they can have an interactive games like
bring me game, guessing game, playing cards and more to entertain the
passengers and to avoid them to feel bored.
Alternatives B for Secondary problem
Since in gaining good reputation and obtaining a good service,
Virgin Atlantic should conduct a disciplinary action for their employees because
they are the one who delivered the service to the passengers. The management
should give a wish list through the attendants upon entering the plane or upon
sitting on their sits. Attendants should distribute this wish list just like during
Christmas. The passenger can write what they want during the flight and after the
flight. They can wish to buy presents for them instead of them who will go to the
duty free. By this wish list, the management and the attendants would know the
likes and dislikes of the passengers and to avoid complaints. And they can also
offer the Upper Class service to their passengers.
Recommendation for the primary problem
Recommendation for the secondary problem
Gaining the trust of customers is not easy. Therefore we
recommend alternative B because by this way the company would know the
needs and wants of their passengers. They would also a big help for them
because the staff would know what to do and what should not do. And they can
give it much better than expected.
Implementation and Control
What Who When How
1. Globalize Marketing 2-3 years if By expanding on
the Virgin Director possible some countries and
Brand Name operate in other
2. Develop Marketing 1-3 years By identifying the
innovative ideas Director needs and wants of
of services the customers then,
3. Ensuring the Mr. Richard Anytime By keeping their
companies safety, Branson and eyes peeled for
reputation and the rest of opportunities and
success the staff threats of the
4. Conduct a Research 6 months-3 Distribute check-list
market research Department years for every passenger.
To know the
HM11 Personnel Management
Case Analysis Evaluation
Case No. /Title: Virgin Atlantic Airways Date: February 16, 2010
Particulars Weight Grade Remarks
1. Sufficient presentation of the relevant issues of
company’s structure and environment
2. Sufficient presentation of the relevant issues of 10%
the company’s marketing practices
3. Appropriate identification and phrasing of the 15%
case problem(s) – primary, secondary with brie
support discussion on the evidence and effects
of the problems
5. Development of sound, appropriate mutually 10%
exclusive strategic alternatives
6. Construction of rational scenario for each 10%
alternative, with relevant, exhaustive discussion
of pros and cons
7. Sound and thorough discussion of the alternative 15%
selected and recommended, justifying
recommendation with the strategic factors
presented in item 6
Implementation, Evaluation and Control
8. Development of thorough and exhaustive 20%
programs to implement and support the
recommended alternative, replete with the
relevant what, why, who, how much (relevant
financial computations), when, where
9. Identification of relevant types of evaluation and 10%
control mechanisms to ensure the
implementation success of recommendation