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1
About Airbus
● Leader in the commercial aviation industry
● Formed in 1967 between Britain, France and Germany
● Currently has 17,000+ aircraft orders, with 10,334 fully delivered
● Single-aisle deliveries account for over half of of Airbus’ operating aircraft
2
Mission Statement
A leading presence in aerospace and defense
markets, Airbus constantly strives for improvement by
driving technological innovation, forging new
partnerships and strengthening its localized presence
around the globe.
3
A380
Airbus’ response to airport congestion
and increased passenger demand:
● Double-decker “Jumbo Jet”
● Introduced in 2005 (First aircraft was put into service in 2007)
● 868 seating capacity || 575+ with a 3-class arrangement
● 15+ hour non-stop flight range
● Allows airlines to transport 60% more passengers in less trips
● Focusing on the “Sweet Spot” of 500+ passengers
4
Business Objective
Core Competencies Strategic Assets Benefits
● Industry Leader
● Technology & Data
● Globalization
● Value Chain
● Value-Add Services
● High capacity jet-liner
● Long distance
capability (15+ hours)
● Existing Airbus
technologies / logistics
● Reduction in airport
and flight overcrowding
● More seats available for
long-distance travelers
● Efficiency and lower
operating costs for
airlines
5
Marketing Objective
● The A380 is positioned to drive acquisition of airline routes currently
occupied by its main competitor Boeing
● Airlines are head-loyal, driven by shareholder pressure for profits
6
Source of Volume
● Stimulate primary demand
● Category leader operating in a
duopoly
● Air travel doubles every 15 years
● Emphasize main variable “long
range flight” to attract new
category users
7
Industry & Competition
● Boeing’s 747 (first introduced
in 1988) is the closest
competitor to the A380
● 1,500+ 747s have been
delivered since its inception
● Overall sales of high-capacity
“Jumbo Jets” have slumped
in recent years
*diagram is pre-stairway reconfiguration (early 2017)8
Segmentation Variables
DynamicVariable:HighCapacitySeating
Main Variable: Long-Distance Capability
7,000 Nautical Miles 9,000 NM 10,000 NM
100Seats400+200
A380
Boeing
787-8
Boeing
777
A340
Boeing
787-9
8,000 NM
300
A350 XWB
Boeing
747
9
Product
● Search: Price, Range, Seating,
Innovative Components / Technology
● Experience: Flight experience (from
passengers & pilots), Ease of use /
incorporation, Reliability, Efficiencies
● Credence: Passengers enjoy the
experience, Pilots / Airline employees
positive experience with jetliner
10
Product
● A380 currently operates out of 60
airports and 120 destinations
● Emirates Airlines has largest fleet
with 94 A380’s
A380
Price $404 Million
Seating Capacity (DV) 868 (max)
Range (NM) 8,200 average
Fuel Cost per Nautical
Mile
$61.83
Cost per Passenger per
mile
$.07 (@ max capacity)
Orders placed 317
Orders Received 210
11
Price
● Market pricing for aircraft is
driven by operating costs
airlines anticipate
● Airbus has lowered the
effective price per seat for
airlines by adding additional
seating
● This discount is intended to
make the A380 more
competitive and align to value
12
Placement
● Buying process requires high involvement and low frequency (premium
product will last 20+ years)
● Airbus delivery team delivers A380 directly to its customers
● Channel breadth for the A380 is exclusive (only one outlet located in
Toulouse, France)
AIRBUS
AIRLINES
(LEASING
COMPANIES)Direct Channel
& Forward
Integration
13
Promotion
● Communication Objective: (Basic
awareness)
● To make A380 more profitable and
attractive they are trying to create
awareness about their innovations and
unique features
● Launch of iflyA380.com- information
about destinations, flight airline
operators, passenger feedback,
facilitates A380 booking with airlines
14
Problem
The A380’s performance has been disappointing with only 12
scheduled for production in 2018. Orders for the massive
aircraft are rarely placed and existing orders have even been
canceled. What actions should Airbus take?
15
New Source of Volume
● Stimulate demand Earn share
● Transition from attracting new
users to taking market share from
Boeing
● Overcrowded flights/airports
● Emphasize dynamic variable
“capacity” to attract competitive
brand/segment users
16
New Big Picture
Category: Long Range Aircraft
Source of Volume: Earn Share (specifically from 747)
Segmentation Variable: Airlines looking to replace / upgrade aging 747’s
Promotion: Information / Behavior (Here’s why your plane needs
replacing / Now replace it with an A380)
Product / Price / Placement: Same
17
New Target Audience
Generic Airline is a full service international carrier. Generic Airline operates
frequent international flights weekly with over 250 passengers per flight to the
Middle East, Asia, Europe, Africa, America, and Australia. The Airline caters to
customers through 3 different seating classes - Economy Class, Business
Class, and First Class. Generic Airline frequently assesses its operation to
discover ways in which they can create more efficiencies in the operations.
Being a major international airline operator, the majority of their flights connect
from major megacities.
18
5-Box Positioning
19
Q&A
Questions???
20

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Big picture framework Airbus

  • 1. 1
  • 2. About Airbus ● Leader in the commercial aviation industry ● Formed in 1967 between Britain, France and Germany ● Currently has 17,000+ aircraft orders, with 10,334 fully delivered ● Single-aisle deliveries account for over half of of Airbus’ operating aircraft 2
  • 3. Mission Statement A leading presence in aerospace and defense markets, Airbus constantly strives for improvement by driving technological innovation, forging new partnerships and strengthening its localized presence around the globe. 3
  • 4. A380 Airbus’ response to airport congestion and increased passenger demand: ● Double-decker “Jumbo Jet” ● Introduced in 2005 (First aircraft was put into service in 2007) ● 868 seating capacity || 575+ with a 3-class arrangement ● 15+ hour non-stop flight range ● Allows airlines to transport 60% more passengers in less trips ● Focusing on the “Sweet Spot” of 500+ passengers 4
  • 5. Business Objective Core Competencies Strategic Assets Benefits ● Industry Leader ● Technology & Data ● Globalization ● Value Chain ● Value-Add Services ● High capacity jet-liner ● Long distance capability (15+ hours) ● Existing Airbus technologies / logistics ● Reduction in airport and flight overcrowding ● More seats available for long-distance travelers ● Efficiency and lower operating costs for airlines 5
  • 6. Marketing Objective ● The A380 is positioned to drive acquisition of airline routes currently occupied by its main competitor Boeing ● Airlines are head-loyal, driven by shareholder pressure for profits 6
  • 7. Source of Volume ● Stimulate primary demand ● Category leader operating in a duopoly ● Air travel doubles every 15 years ● Emphasize main variable “long range flight” to attract new category users 7
  • 8. Industry & Competition ● Boeing’s 747 (first introduced in 1988) is the closest competitor to the A380 ● 1,500+ 747s have been delivered since its inception ● Overall sales of high-capacity “Jumbo Jets” have slumped in recent years *diagram is pre-stairway reconfiguration (early 2017)8
  • 9. Segmentation Variables DynamicVariable:HighCapacitySeating Main Variable: Long-Distance Capability 7,000 Nautical Miles 9,000 NM 10,000 NM 100Seats400+200 A380 Boeing 787-8 Boeing 777 A340 Boeing 787-9 8,000 NM 300 A350 XWB Boeing 747 9
  • 10. Product ● Search: Price, Range, Seating, Innovative Components / Technology ● Experience: Flight experience (from passengers & pilots), Ease of use / incorporation, Reliability, Efficiencies ● Credence: Passengers enjoy the experience, Pilots / Airline employees positive experience with jetliner 10
  • 11. Product ● A380 currently operates out of 60 airports and 120 destinations ● Emirates Airlines has largest fleet with 94 A380’s A380 Price $404 Million Seating Capacity (DV) 868 (max) Range (NM) 8,200 average Fuel Cost per Nautical Mile $61.83 Cost per Passenger per mile $.07 (@ max capacity) Orders placed 317 Orders Received 210 11
  • 12. Price ● Market pricing for aircraft is driven by operating costs airlines anticipate ● Airbus has lowered the effective price per seat for airlines by adding additional seating ● This discount is intended to make the A380 more competitive and align to value 12
  • 13. Placement ● Buying process requires high involvement and low frequency (premium product will last 20+ years) ● Airbus delivery team delivers A380 directly to its customers ● Channel breadth for the A380 is exclusive (only one outlet located in Toulouse, France) AIRBUS AIRLINES (LEASING COMPANIES)Direct Channel & Forward Integration 13
  • 14. Promotion ● Communication Objective: (Basic awareness) ● To make A380 more profitable and attractive they are trying to create awareness about their innovations and unique features ● Launch of iflyA380.com- information about destinations, flight airline operators, passenger feedback, facilitates A380 booking with airlines 14
  • 15. Problem The A380’s performance has been disappointing with only 12 scheduled for production in 2018. Orders for the massive aircraft are rarely placed and existing orders have even been canceled. What actions should Airbus take? 15
  • 16. New Source of Volume ● Stimulate demand Earn share ● Transition from attracting new users to taking market share from Boeing ● Overcrowded flights/airports ● Emphasize dynamic variable “capacity” to attract competitive brand/segment users 16
  • 17. New Big Picture Category: Long Range Aircraft Source of Volume: Earn Share (specifically from 747) Segmentation Variable: Airlines looking to replace / upgrade aging 747’s Promotion: Information / Behavior (Here’s why your plane needs replacing / Now replace it with an A380) Product / Price / Placement: Same 17
  • 18. New Target Audience Generic Airline is a full service international carrier. Generic Airline operates frequent international flights weekly with over 250 passengers per flight to the Middle East, Asia, Europe, Africa, America, and Australia. The Airline caters to customers through 3 different seating classes - Economy Class, Business Class, and First Class. Generic Airline frequently assesses its operation to discover ways in which they can create more efficiencies in the operations. Being a major international airline operator, the majority of their flights connect from major megacities. 18