Air Asia Marketing Research
Air Asia’s quirky means of promotion has certainly helped make the airline a household name. Yet, barely eight years ago when it began operations, Air Asia had just two planes and a host of obstacles – Sars and the Sept 11 terrorist attacks included that preventing it from taking off. Today, the Malaysia-based budget airline boasts a fleet of 80 aircraft that ply over 122 routes, with 480 flights to more than 65 destinations daily. Group CEO Tony Fernandes has been instrumental in building the Air Asia brand. Known for its strong marketing and branding culture, Air Asia was recognized as one of Malaysia’s 30 Most Valuable Brands in 2008, and also made it to US-based business magazine Fast Company’s top 50 list of most innovative companies in the world last year. Their goal is to “continue to be the lowest cost airline in every market we serve”
Positioning Air Asia has considerate advantages over other airlines in many ways. Firstly, its experience of being in this industry for long time contributes to the already established service standard, operational expertise, infrastructure readiness, as well as bargaining power with suppliers. According to the survey done by www.lowcostairline.org, the travelers ranked Air Asia as number 8 of their most favorite low cost airlines. Secondly, Shin Corp, local partner, is very powerful business entity as it has highly diversified portfolio and many strategic business units in media industry. This gives Air Asia the competitive edge in terms of creating awareness of the brand and budget airline industry as a whole.
Product Strategy Air Asia provides a good service to their customer in order to attract their customer to come back after first time travel with Air Asia. First, Air Asia provide a service that pay attention to customer’s safety. It partnering with the world’s most renowned maintenance providers and complying with the world airline operation to ensure every plane in safety condition that can look after customer safety. Air Asia also uses Streamline Operations to make sure that processes are as simple as possible. It cans faster the service that provides to customer. It also provides a no seat assignment service to customer. So that, customer can freely finds their seat that comfortable for themselves. In additional, Air Asia also has provided an in-flight magazine to customer. It can take away their customer bored when in the plane. This is the first in-fight magazine that had provided by an airline in Malaysia. So, services are also important factors that that causes Air Asia so successful. Read another article “SWOT Airasia”
Pricing AirAsia is using randomized pricing strategy to increase the market demand and profit maximize. This strategy enable AirAsia varies its price from time to time, even more accurately is from day to day. Indirectly, this strategy is giving surprise for customer for each time of promotion, and the customer cannot learn from experience on the lowest price charge in the market. As a result, this influence the customer to pay attention on the price every minute, just to get the desired price they want.
Distribution Strategy AirAsia has implemented Computer Reservation System (CRS). AirAsia has used Open Skies to centralize customer data and this has helped AirAsia to track booking and the schedule of flight activities in real. Open Skies booking system which provided by Navitaire performed almost flawlessly on every single occasion and it managed to handle the most demanding requirements of AirAsia’s flight booking operations. On the other hand, on July 2010, AirAsia has successfully completed the implementation of its new reservation system which called New Skies. This booking system has replaced the previous system, Open Skies. Furthermore, this New Skies gives the customers a new experience as well as providing a greater convenience and generate more savings for the customers.
Marketing Communication Strategy AirAsia, the leading low cost airline in Asia, intends to develop its route map to Africa and new European destinations in the future. Currently AirAsia has succeeded in providing low cost flight services in areas with limited connectivity and high fares, especially in Asia. It also launched new services about travel products and membership service, such as AirAsia Go Holiday and BIG loyalty program. In order to eliminate risk and increase efficiency, AirAsia also collaborated with Expedia, Malaysian Airline System (MAS) and Japan’s All Nippon Airways. To gain further increases in net sale, AirAsia has introduced new flight routes and planned to spread its coverage to new places in Africa and Europe. There are opportunities and challenges for this market development strategy. The global context, especially political chaos and economic crisis, can be a threat to its development. On the other hand, its market strategy, communication campaign and technological improvement would aid to grasp this opportunity.
To remain the best company, Airasia provide and had a researched about smart cards that can be issued compatible with the prevailing ticketless booking. AirAsia can issue two kinds of smart cards. The first for the ordinary travelers offering rewards when topped and offering a value which is greater than the purchase price. For example: A card of 5000 may be worth 5500 and should be allowed to use by the person and his family having the same family name as the cardholder. The second one would be for frequent flyers offering unlimited travel. This smart card should be prices carefully for example at 15000 and the owner of the card can fly as many times as he wants over the specified period of time. Budget :
Air Asia is one of the world’s first long-haul budget airlines and offers cheap flights from London to Kuala Lumpur, Malaysia. Kuala Lumpur is an Air Asia hub, so even if you’re destination is Hong Kong and Macau, Thailand, Australia and beyond, flying into Malaysia with Air Asia and connecting, can still be cheaper than flying with traditional airlines. The Air Asia arm that operates the airlines long-haul flights is actually Air Asia X, although when booking you’ll see no difference between Air Asia and Air Asia X. Flying from London to Kuala Lumpur, one way tickets can be purchased for as low as £190, including all taxes. This is the economy promo price. Standard prices seem to come in around the £220 -£250, with taxes included. This is excellent value for money, and even if you have to shell out another £50 to connect regionally, you’ll still be saving money. Control :
Earlier this year Fernandes moved over 20 personnel to Jakarta and set up a planning office. This move has been criticised and he continues to get knocked for making that decision. “People still think I have left Malaysia because of the (failed) share swap between MAS and AirAsia,” he says. He handed the reins of the Malaysian operations, something he has been very passionate about because he founded and set up AirAsia Malaysia, to Aireen Omar. Though he says he has handed the reins, those in the know claim the he is very much in control of the day-to-day operations.
Marketing Organization AirAsia is the world most leading low cost carrier airline now as their name had earned a lot of recognition worldwide because consumer as their TOP priority with the tagline of “Now Everyone Can Fly”, AirAsia has made flying affordable for more than 61million guest. AirAsia started their business in year 2001 with only MYR1.00 with the partnership with Tune Air Sdn Bhd and AirAsia was remodeled into a low cost carrier by January 2002 where their mission is to make air travel much more affordable for Malaysians took flight. Valued at MYR2.3 billion, AirAsia is today award winning and the largest low cost carrier in Asia. From a two aircraft operation of Boeing 737-300, AirAsia currently boasts a fleet of 78 aircraft that flies to over 60 domestic and international destinations. The airline has carried, thus far, over 61 million guests since its first day of operation. Low fares is AirAsia’s philosophy where it has sparked a revolution in travel as more and more people from all walks of life are now able to fly for the first time. AirAsia’s success has taken flight through the continued confidence of our guests who prefer a no frills, hasselfree, low fare and convenient option in air travel. Figure 1.0 is the organization’s structure of Airasia.