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EasyJet Analysis

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EasyJet analysis for Marketing Module

EasyJet analysis for Marketing Module

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  • do you think recession is one of the factor of increasing market demand? cuz during recession, consumer will look for ways to reduce the expenses, therefore it will increase easyjet customers. What do you think about this?
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  • http://2009annualreport.easyjet.com/index.html
  • http://2009annualreport.easyjet.com/index.html
  • http://www.theccc.org.uk/sectors/aviation/demand-for-air-travel
  • http://www.theccc.org.uk/sectors/aviation/demand-for-air-travel
  • http://www.theccc.org.uk/sectors/aviation/demand-for-air-travel
  • Ryanair – slightly cheaper air fares as they fly to secondary airport
  • http://www.comparebroker.com/blog/2010/02/18/oil-prices-factors-reasons-behind-why-oil-prices-fluctuate/
  • http://www.comparebroker.com/blog/2010/02/18/oil-prices-factors-reasons-behind-why-oil-prices-fluctuate/
  • Government Regulations - http://www.theccc.org.uk/sectors/aviation/demand-for-air-travelGovernment Regulations - http://news.bbc.co.uk/2/hi/8626505.stm
  • Government Regulations - http://www.theccc.org.uk/sectors/aviation/demand-for-air-travelGovernment Regulations - http://news.bbc.co.uk/2/hi/8626505.stm
  • Government Regulations - http://www.theccc.org.uk/sectors/aviation/demand-for-air-travelGovernment Regulations - http://news.bbc.co.uk/2/hi/8626505.stm
  • http://www.london.edu/facultyandresearch/research/docs/CM_04-904.pdf
  • Punctuality - http://www.easyjet.com/en/news/20000414_01.html
  • Aircraft Fleet Flies young fleet (minimise maintenance costs incurred)
  • http://www.docshare.com/doc/98170/Easyjet-cost-strategy
  • http://www.docshare.com/doc/98170/Easyjet-cost-strategy
  • Middle East sector - http://arabianaerospace.aero/article.php?section=events&article=airport-support-systems-slowing-down-business-aviation-potential-in-gulfhttp://www.ameinfo.com/96238.html
  • Middle East sector - http://arabianaerospace.aero/article.php?section=events&article=airport-support-systems-slowing-down-business-aviation-potential-in-gulfhttp://www.ameinfo.com/96238.html

EasyJet Analysis EasyJet Analysis Presentation Transcript

  • Content
    Introduction to easyJet
    Factors affecting the airline industry
    SWOT
    Strategies of easyJet
    Recommendations
    Conclusion
  • easyJet
    INTRODUCING
    EASYJET
  • Introduction
    British budget airline, 2nd largest low cost carrier in Europe
    Founded by Sir Stelios Haji-Ioannou in 1995
    Part of EasyGroup
    easyHotel
    easyBus
    easyCar
  • Introduction
    Serves major airports in key markets
    Targeted market segment
    Business travelers due to high frequency of flights and convenience
  • Introduction
    Vision:
    To Be The Best Low Fares Airline In The World
    “making flying as affordable as a pair of jeans”
  • Introduction
    • Strategic priorities:
    Safety
    Building Europe’s No 1 Air Transport Network
    Develop a winning customer proposition
    Deliver low cost and maximise margins
  • Introduction
    • Strategic priorities:
    Safety
    • Flight management data
    • Safety management system
    Building Europe’s No 1 Air Transport Network
    • Build frequency and stability to core routes
    • Number of aircraft based in countries is constantly being reviewed
  • Introduction
    • Strategic priorities:
    Develop a winning customer proposition
    • Arrive at destination within 15min of scheduled time
    • Tailored marketing email offer according to preference of individual customer
    Deliver low cost and maximise margins
    • Focus on fuel conservation
    • Own family of air craft which is cheaper to operate
  • easyJet
    FACTORS AFFECTING THE AIRLINE INDUSTRY
  • Factors
    General factors affecting strategies and decisions within airline industry
    Market demand
    Competitors
    Fluctuation in oil prices
    Threat from terrorism
    Natural disaster / epidemic
    Government regulation
  • Factors – Market Demand
    Market Demand
    Increased demand for air travel due to:
    Reduction in air fares
    Increased in average incomes
  • Factors – Market Demand
    Significant increase in short haul travels.
    Increase to 187million
  • Factors – Market Demand
    Competitive Market
    Cannot influence on-going market price
    Travelling considered as luxurious good.
    Demand is elastic
    Small increase in price
    Big drop in demand
  • Factors – Competitors
    Competitors
    Presence of competitors offering similar products
    Comparison of price can be done easily through internet
  • Factors – Oil prices
    Fluctuation in oil prices
    Due to instability in middle east, influence of cartel
    Oil resource drying up
  • Factors – Oil prices
    Increases in oil prices will increase cost of production
    Erode profit margin
    Consumer have to pay more
  • Factors – Terrorism
    Threat from terrorism
    Fear of flying
    May avoid air travel until psychological shock is overcome
    E.g.
    Bombing in London on 7th July 2005
    US recently issued a travel alert to travel in Europe
  • Factors – Epidemic / Natural Disaster
    Epidemic / Natural Disaster
    SARS (November 2002)
    Fear of being contracted
    Volcanic ash cloud over Europe (April 2010)
    Halting of aircraft
    Loss of $200 million in a day
  • Factors – Government Legislation
    Government regulation
    Environmental degradation becoming a major issue
    Increase in emphasis on sustainable development
    Sustainable marketing – invest in modern fuel efficient aircraft operating at high capacity
  • General Pricing Strategy
    Dynamic Pricing
    Adjust prices continually when flight date nearing
    Promotional Pricing
    Temporary reduction of price to create excitement
  • easyJet
    SWOT ANALYSIS
  • SWOT
  • S
    SWOT - Strengths
    • Flies to primary airports
    • Convenience for business travellers on tight schedules
    • Low cost offering
    • No frills airline – non essential features removed
    Eg. Light freshments
    • Reverse Pricing System
    The earlier you book, the cheaper the air ticket
  • S
    SWOT - Strengths
    • Ease of booking flights
    • 24/7 Internet booking
    • Phone booking(slowly phasing out)
    • Fast turnaround time of aircrafts
    • Planes ready to take off within 30 minutes from landing
    • Efficient
    • Increase frequency of flights
  • S
    SWOT - Strengths
    • Highly distinctive branding
    • Featured on Airline TV series, spread name in UK
    • Bright orange colours
    • Catchy slogans
    Eg : “The web’s favourite airline”
    “Come on, let’s fly”
    • Website livery painted on plane
  • W
    SWOT - Weakness
    • High-density seating
    • Discomfort for passengers during long distance flights
    • Hassle in changing bookings
    • Top up difference in price depending on current price level
    • Relying solely on price is not a good strategy
    • Competitors may draw customers away by offering lower prices
  • O
    SWOT - Opportunities
    • Weakening Pound against Euro
    • Increased demand in travel from European countries to Britain
    • Cater more flights
    • Rising markets
    • Middle East
    • China
  • SWOT - Threats
    T
    • Brand names
    • Easy to copy
    • Confuses customers
    • Damage the brand name
  • SWOT - Threats
    T
    • Competitors
    • Ryanair
    • Europe largest low-cost carrier in terms of market share
    • Fly to secondary airport
    • Air Berlin
    • Germany’s 2nd largest airline
    • Offer free snack and drinks
    • Fly out of Europe
  • SWOT - Threats
    T
    • Alternative modes of transport
    • Eurorail - Trains
    • Comparable duration and price for short distances
  • easyJet
    easyJet’s Strategies
  • easyJet’s Strategies
    4 Ps
    Place
    Promotion
    Product
    Price
    Other strategies
  • 4Ps - Places
    Place
    Online booking website
    Telephone booking
  • 4Ps - Promotion
    Promotion
    Internet business model
    Slowly phasing out telephone sales operation
    Aggressive branding
    Bright orange colour
    Catchy slogans
    Website livery on airplane
    Featured in Airline TV Series
  • 4Ps - Product
    Product
    Offers one-way tickets for passengers
    Flexibility of travelling
    No frill experience
  • 4Ps - Price
    Price
    Good-value pricing – right combination of quality and price
    Everyday low pricing
    Due to cost advantage strategies
    Does not provide free on board snacks and beverages
    No business class seats
    Direct marketing – use of internet
  • 4Ps - Price
    Optional-Product Pricing – Pricing of complementary products
    Food & Beverages
    Priority Boarding Pass
    Dynamic Pricing - prices vary according to demand and date of booking
    Charges low prices for early bookings
  • Other Strategy
    Diversification
    Unable to rely on low-cost approach
    EasyGroup provides complementary services
    Offer a bundled deal which increases convenience for customer.
    Ryanair also use similar approach but tie up with partners to earn commissions
    easyJet will have more control over promotion package
  • Other Strategy
    Environmental Strategy
    To be efficient in air
    Efficient use of aircraft
    Fly short haul only
    To be efficient on the ground
    Using less ground equipment
    Keep waste to minimum
  • easyJet
    Recommendation
  • Recommendation
    Current Situation / Trend
    Global warming
    Increased air pollution
    Various sources such as factories, power plants, motor vehicles and aircrafts
    Aircrafts are a major contributor of carbon dioxide gases to the atmosphere
  • Recommendation
    Increase emphasis on sustainable development
    Green initiatives
    Reduce
    Reuse
    Recycle
  • Recommendation
    What we propose easyJet should do
    In view of the current situation
    Actively market easyJet as a Green Airline
    Allow consumers to see easyJet as intrinsically associated with green issues
  • Recommendation
    Potential Advantage for easyJet
    Improve branding of easyJet (Societal Marketing)
    Concerned with making a positive impact on the environment
    Customers will associate easyJet with being green
    “Consumers not just buying an air ticket, they are buying into something bigger, and that is reduced air pollution”
  • Recommendation
    • Lower cost of operation
    • Possible free or extended advertising from green groups
    • Fuel efficient engines allow greater savings
  • Recommendation
    Potential Advantages for third parties
    Companies’ whose staff travel with easyJet
    Improve image of companies
  • Recommendation
    How to do it
    Seek constant improvements into greener technology
    Jet engines that reduce fuel consumption and emit less harmful gases
    NASA is developing technology that would permit Boeing 737 and Airbus A320 jets, in 2018, to burn 25% less fuel and reduce nitrogen oxide emissions by 80%.
  • Recommendation
    Catchy slogan
    its easyJet being green…
  • easyJet
    Conclusion
  • Conclusion
    Cannot rely solely on low pricing
    Only one element of company’s broader marketing strategy
    Does not retain customer’s loyalty
    Seek to differentiate from competitors
    Green Initiatives
    Cost savings due to fuel efficiency
    Carry on providing low cost
  • Q & A