The company believes that customers are the key to their expansion along with their growth. These include a 36% increase in passengers carried by AirAsia Malaysia, 79% increase in passengers carried by AirAsia India and an increase of 65% of passengers carried by AirAsia Thailand. And thus Indians meet their target requirements perfectly, Government charges and costs that are not in the control of the company may lead to severe losses in the future, With dynamic management and other operational costs, it becomes difficult to manage low-cost flights, AirAsia has 62.K followers on Instagram, 93.5K followers on Twitter, and 12M likes on Facebook, They post regularly on their pages, at least a couple of times a week, and maintain this consistency, They post a variety of content that aims at staying relevant in the minds of the customers, Their main strategy seems to be posting about exotic travel destinations with Call-to-Action, encouraging customers to avail their services in exploring these locations, The company also posts environmentally friendly content to echo the ethos of its brand. The company provides its services to people of every age group of society, and to the people belonging to the medium and high ranged of income or financial status. As Airasia only contribute 2 % from Airbus total order, Airbus has possess strong bargaining power over AirAsia. As compared to the services of the AirAsia,Malaysia Airlinesprovides better services and gain efficient customer satisfaction. The article below lists the Air Asia SWOT, competitors and includes its target market, segmentation, positioning & USP. Study for free with our range of university lectures! Browse marketing analysis of more brands and companies similar to Air Asia. AirAsia was named as the best low-cost airline company in the world for 9 consecutive years at the Skytrax World Airline Awards. Its routes include both domestic and international flights. They have achieved effective targeting to this segment by making their brand synonymous with low-cost services. As there are no significant differences in product offering, the customer may differ them through the service provided. In addition, rates are determined by the class of flight, airline load factors, travel dates and days, and competitor pricing in the airline industry. When it comes to promotions, AirAsia has made a name for itself as a company that focuses on increasing consumer satisfaction. They have a vast network of operations around the world, flying domestically and internationally. AirAsia managed to become one of the most popular and profitable airline companies in the world by implementing visionary leadership and innovative business approach. Our core asset in successfully accomplishing our objective is our experienced writers. Strengths are defined as what each business does best in its gamut of operations which can give it an upper hand over its competitors. Do essay writing needs professional writers? Besides, Airbus is using advance technology in designing aircraft, thus the power of supplier is high due to Airasia must depend to the Airbus engineers to do maintenance of the aircrafts and seek advices. UNICEF collaborated with AirAsia to raise $ 128 million for the people who were affected by the earthquake in Haiti. Ahsan Ali Shaw is an accomplished Business Writer, Analyst, and Public Speaker. However, the airline doesnt serve pork and alcoholic drinks based on Islamic religious grounds. Points to consider while selecting a topic for dissertation help. Another strategy that the company will implement in the future is networking. For example, they had a #responsibletraveller campaign on Instagram. Any opinions, findings, conclusions or recommendations expressed in this material are those of the authors and do not necessarily reflect the views of UKEssays.com. He is a Content Marketing Expert and has trained 6000+ students and working professionals on various topics of Digital Marketing. The company is constantly using innovative solutions to provide low-cost transportation. As reported in The Edge Markets in 2019, Khazanahs managing director Datuk Shahril Redza Ridzuan claimed that the airlines CASK was only 15 per cent to 20 per cent higher than AirAsia and was in fact lower than regional airlines such as Singapore Airlines, Thai Airways and Cathay Pacific. *You can also browse our support articles here >. The market has confronted critical competition in the form of new competitors who have also introduced low-cost flights. It has subsidiaries in Indonesia, Thai, Phillipines, Japan, 5.It has a fleet size of nearly 300 aircrafts. High numbers of Competitor. Their 5 main operational hubs are Singapore, Indonesia, Japan, Malaysia, and Thailand. This involves a detailed analysis of their actions and how these would affect the future strategies of AirAsia Flying Low Cost with High Hopes. The content on MBA Skool has been created for educational & academic purpose only. SWOT Analysis is a technique for analyzing these four aspects for a business for better decision making and judgement of its current position. Below are the Strengths in the SWOT Analysis of Air Asia : 1. The management of costs in relevance to the dynamic prices of fuels and maintenance results in a significant issue for the organisation to sustain its low-cost flights with profits. DRB-HICOM, a government conglomerate laid the foundation of AirAsia in 1993 and it became operational on Nov 18, 1996. Some factors like increased competitor activity, changing government policies, alternate products or services etc. Air India, Emirates, and many other Asian airlines have also started following the low-cost carrier strategy to attract market share. In the increasing demand of the airline services, there is a tough competition in the airline industry because of the varied numbers of the competitors that are providing the airline services. (vitag.Init = window.vitag.Init || []).push(function () { viAPItag.display("vi_23289101301") }). They may compete in term of their route offering that Airasia does not fly. 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. Some writers often extend the acronyms to include legal and environmental factors. Some of the opportunities include: Threats are those factors in the environment which can be detrimental to the growth of the business. Required fields are marked *. The major issue with maintaining low ticket price is the increasing competition in the airline industry. Jet Star Airways provides more than 80 destinations that include Asia Pacific, Australia and Honolulu in America. 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. Air Asia uses direct sales methods, such as sales through the internet, call centres, and walk-in airport sales. Luggage handling is the major factor that is considered by the customer as well as the airlines industries and in context to this fact, Malaysia Airlines provides average 15 kg of luggage, and it does not include any additional charges in case there is few more luggage than the normal capacity provided by the airlines. Management of costs: Air Asia is finding it immensely difficult to manage the fluctuations in costs of The company can increase its sales in these pandemic times as well by leveraging its low-cost flights. It employs an anchor pricing policy, which establishes a baseline for pricing all AirAsia-operated flights. Both these budget airlines are units primarily concerned with maintaining a low-cost position in the mature market.. History of Garuda Airlines. In 2002, AirAsia became the first airline company in the region that allowed passengers with the facility to pay for their bookings by using credit card. These are people ranging from those who could not afford to fly previously, to corporate business employees whose employers are looking to fly them while cutting costs. Continue reading more about the brand/company. The microenvironmental analysis for any company or organisation is performed using Porters Five force model. Find useful insights on AirAsias company details, tech stack, news alerts, competitors and more. Besides @flyairasia and The brand colours of Air Asia are red and white, which represent determination along with passion, perfection, and positivity to serve customers high-quality services at low prices (Mele, Pels and Storbacka, 2015). Discover AirAsia alternatives or similar companies to benchmark and competitors' market analysis. In comparison to the competitors, Air Asia is credited with the lowest cost of operation at a unit cost of US$0.023 per available seat kilometer (ASK) and a passenger breakeven load factor of 52%. The cost leadership business strategy helps the company to maintain service quality, hospitality, and in-flight services and maintenance cost, within the specified budget as the company has to maintain a low-cost price for air tickets. Your topic helped a lot, Your email address will not be published. AirAsia can collaborate or establish a joint venture with competitors to minimise competition and expand growth and profit opportunities (COM, 2017). 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. But in 1993, Air Asia was established to finally connect Asia like no other airline company. Their slogan Now Everyone Can Fly itself sets the tone for the brand. Hence the airlines companies have more sales on individuals tickets rather than the groups of customers. Similar service provided among every airline company so the competitive may be fierce. Another important strategy that Air Asia will consider enhancing is improving Information Technology (IT) services in the company, as well as in the aeroplanes. I am a Digital Marketer and an Entrepreneur with 12 Years of experience in Business and Marketing. As per the results of the survey, AirAsia has. Apart from that, AirAsia engages in popular promotions such as social media advertising, print advertisements, and simple but efficient billboard advertising. It has been reviewed & published by the MBA Skool Team. AirAsia focuses on delivering accessible promotions, in which customers are aware of new product offers with minimal company intervention through simple tools such as emails. AirAsia X was regarded as having the worlds best low-cost airline premium seat and the worlds best low-cost airline premium cabin for five consecutive years (AirAsia X, 2018). With the emerged of information technology, many companies are to operate with using the IT and e-commerce because the IT allows international business without boundaries. The main focus of Air Asia is to provide convenience to the customers by providing the best services at low cost. As increasing in the number of airline competitor such as Jet Star and Tiger Airways which are also promote low cost fare may decrease the shifting cost of the customer lead to decrease of Air Asias customer loyalty. Air Asia operates flights to around 165 destinations that include both domestic and international with a fleet size of 92. Another activity considered under this strategy is marketing and sales. Continue reading more about the brand/company. Disclaimer: This is an example of a student written essay.Click here for sample essays written by our professional writers. 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 Strengths. Air Asia started with only 2 Boeing 737 300 series and started their first point-to-point flights. Air Asia is known as one of the most low-cost airlines in the airline 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. Today, well discuss the swot analysis of AirAsia. The strengths of Air Asia looks at the key aspects of its business which gives it competitive advantage in the market. Over the years Air Asia has broken the travel norms for Asian countries and is known as the pioneer of low-cost travel in Asia. In this context, Air Asia will be focusing on the use of the strategy of service innovation as it is the best strategy to effectively implement the factor of providing new and enhanced services to passengers at low cost. Firstly, macro analysis has been performed with the help of PEST analysis, in which the political, economic, social and technological analysis has been conducted in correlation with AirAsia. The company also engages in direct service development strategy by treating employees as an essential part of the organisation. The threats for any business can be factors which can negatively impact its business. Secondly, microanalysis has also been conducted for AirAsia with the help of PORTERs five forces model. AirAsia was bought over by Tony Fernandes, the current chief executive officer of AirAsia from DRB-Hicom on 2nd December, 2001 (Soon, 2017). The organisational image is consistent and successful concerning the competition in the market. AirAsias marketing strategy has worked wonders for the company in communicating exactly what they wanted to the customers. 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. Registered office: Creative Tower, Fujairah, PO Box 4422, UAE. Given the current situation, in-flight experience, especially hygiene matters a lot to customers so AirAsia should heavily market its hospitality and put customers at ease in availing their services. Features, such as improved WIFI and other entertainment facilities, can be improved with the help of latest trends and technologies in the IT industry. Use Slintel to connect with top decision-makers at AirAsia. Focusing on providing air travel without frills at substantially lower prices, AirAsia has managed to achieve lower prices to attain high passenger loads, market share, and profitability by eliminating provision of The airline offers400destinations both local and international in25countries across the world. The adaptable quality of the employees with changes and amendments ensures ease in amending and improvising the operations of the organisation (Lim. SilkAir 3.Tiger Airways Hence this concludes the Air Asia SWOT analysis. AirAsia X aimed to ensure high frequency and point-to-point networks to the businesses situated at long distances. Switching Cost is low. Step 3- Assess the Porter Five Forces in relation to the industry and assess which forces are strong and which forces are weak. The bargaining power of buyers is strong because most of the customers for Airlines Company are individual travellers instead of travel in group. WebAirAsias top competitors are Air India , American Airlines, Emirates Airlines , British Airways , Delta Airlines, Tiger Airways, Silk Air, Jetstar Airways, and many others. The profits of the organisation have been observed to be remarkable which introduce an opportunity to new competitors causing a severe threat to AirAsia for sustainable profits. Their target audience is- travelers looking for inexpensive flights. WebThe two closest competitors that are considered against AirAsia include Jet Star Airways and Malaysia Airlines (AirAsia, 2018). WebCompare AirAsia against competitors. It was started in 1993, and the operations began in 1996. AirAsia is the largest low-fare airlines and rapidly growing in Asia since 2001. From simple essay plans, through to full dissertations, you can guarantee we have a service perfectly matched to your needs. It must have a good relation with hotels and tourism companies around Asia. The threats in the SWOT Analysis of Air Asia are as mentioned: 1. Its other main competitor, Malaysia Airlines , serves Kota Bahru and Singapore but dropped Bandung in late 2011. AirAsia offers transportation services to its passengers along with several other services, which includes courier services and cargo services. In fact, AirAsia has sponsored many international events and teams to give exposure to its brand name. It ensures no-frills, low fare, and hassle-free services to decrease the cost and increase the efficiency in every unit of its business. Swot Analysis of AirAsia Berhad. The portions of income of an individual earns is the factors because when the portion is high, the more customers will look for cheaper price, hence the bargaining power of buyers will be strong. AirAsia uses various media platforms for the marketing and promotion of its products and services. 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. Ease to switching. Step 3- Assess the Porter Five Forces in relation to the Airline industry and assess which forces are strong in Airline and which forces are weak. Comment * document.getElementById("comment").setAttribute( "id", "a896926ff00456d33666396e451bba6e" );document.getElementById("i2e65971ac").setAttribute( "id", "comment" ); Copyright 2023 Marketing91 All Rights Reserved. Strengths in the SWOT analysis of Air Asia, Weaknesses in the SWOT analysis of Air Asia, Opportunities in the SWOT analysis of Air Asia, JioMart launches its Digital-First Holi Campaign targeting Sale from 1st to 8th march, Tata Groups talks over $1 billion Bisleri stake stall, Goodbye Vistara Airlines! Do you have a 2:1 degree or higher? The increasing traffic from India and Indians prefer budget airlines as they are cost conscious 2. In this strategy, the company uses activities such as inbound logistics, where all the aircrafts are of one type; hence, reducing the maintenance cost, scheduling cost, and cost of managing inventory. Fixed Cost is high. It follows vital certain strategies, which include safety first, high aircraft utilisation, streaming operations, lean distribution system and point-to-point network to amplify the working of its low-cost model (Zhang et al., 2017). The overall services that are provided by Malaysia Airlines and AirAsia have a tremendous difference. As there are adequate options available for passengers to choose from, at the similar price as Air Asia, the company needs to focus on the amenities and hospitality services it provides to the customers. 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. The Essay Writing ExpertsUK Essay Experts. Very interesting and informative. 2.1.2 Pest Analysis PEST analysis is a useful tool for scanning the general environment. The companies are not associated with MBA Skool in any way.Edit the brand or add a new one to SWOT Analysis section : Contribute. Business is my passion and i have established myself in multiple industries with a focus on sustainable growth. Premium airlines, such as Singapore Airlines and Cathay Pacific, taking advantage of the healthy macro-economic variables in This paper will examine the results of the strategic actions of AirAsia in the Malaysian domestic airline market. WebStep 2 Identify the competitors and group them based on the segments within the industry. It mainly constitutes of two major subsidiary airlines that includes MASwings and Firefly. The company makes use of innovative solutions in order to provide low-cost aviation. About Air Asia Air Asia in order to sustain in the ever-growing international market of the airline industry needs to enhance the existing strategies and develop new strategies for effective sustainability. AirAsia has prioritised the adoption of technological advancements to enhance their services and operations. Air Asia maintains its image in the market by choosing the right set of employees depending on their capabilities (Shaw, 2016). Supplier concentration in a few hands. - Strong brand recognition - Airasia products have strong brand recognition in the Airline industry. Jet Star Airwaysare considered as the safest low cost carriers among the 10 safest carriers in the airline industry of Australia. This has been possible due to the companys relentless communication through various marketing channels. AirAsia X joins AirAsia Berhad and Thai AirAsia with stock listings. The company will increase the current IT facilities used in the aircrafts to enhance the facilities provided to the customers. WebAirAsia Competitors Specify up to 10 symbols: WH REGN XHR NVO VRTX HOG IHG rprx Sophisticated investors, who have witnessed many market ups and downs, frequently The PESTLE Analysis highlights the different extrinsic scenarios which impact the business of the brand. Additionally, competitive analysis is conducted for AirAsia, which is used to determine the strengths and the weaknesses of AirAsias competitors. Kamarudin Meranun and Tony Fernandes bought the airline on Sep 08, 2001. The organisation has outsourced its maintenance and repairing facility as it does not possess in such facilities. This tells us that AirAsia mainly needs to understand its customers a little better and provide them with the extra services they need. Hi, I am an MBA and the CEO of Marketing91. Pacific (Cebu Air Inc, 2012), AirAsia (AirAsia, 2011), and JetStar Airways (Jetstar Airways, 2012) all reporting increase in revenues and recording profits over the previous year. AirAsia X has amplified its profit-making routes to multiple countries such as Australia, France, Iran, South Korea and New Zealand. Out of which, the net income of the airline was-5097million MYR, and it has decreased by1513.76%. Back in the 1900s Thai National Airlines was the only airline that could fly in the main routes of Bangkok Chiang Mai with non-stop flights. Carriers in the form of new competitors who have also introduced low-cost flights the major issue maintaining! For a business for better decision making and judgement of its current position using innovative in. 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Started following the low-cost carrier strategy to attract market share competitor, Malaysia, and Thailand named as best! Better services and cargo services among the 10 safest carriers in the industry... Honolulu in America France, Iran, South Korea and new Zealand and teams to give exposure its... Phillipines, Japan, 5.It has a fleet size of nearly 300.. Secondly, microanalysis has also been conducted for AirAsia with the help of Porters Five forces in to! A detailed analysis of more brands and companies similar to Air Asia looks at the to... And marketing the organisational image is consistent and successful concerning the competition in the form of new who!, 2017 ) income of the AirAsia, Malaysia Airlinesprovides better services and cargo services [... The right set of employees depending on their capabilities ( Shaw, 2016 ),! Most popular and profitable airline companies in the airline was-5097million MYR, and it operational! Disclaimer: this is an example of a student written essay.Click here sample! Known as the safest low cost with High Hopes new Zealand their route offering that AirAsia does possess... Asia started with only 2 Boeing 737 300 series and started their first point-to-point flights # responsibletraveller campaign on.. With changes and amendments ensures ease in amending and improvising the operations began in 1996 company details, stack... Service development strategy by treating employees as an essential part of the most popular and profitable airline companies the. Of Marketing91 MYR, and simple but efficient billboard advertising forces are strong and forces! Exposure to its passengers along with several other services, which is to! Sep 08, 2001 may differ them through the service provided Asia maintains its image in world! Competition and expand growth and profit opportunities ( COM, 2017 ) Slintel connect! Amplified its profit-making routes to multiple countries such as Australia, France, Iran, South Korea and new.. Connect Asia like no other airline company in the aircrafts to enhance their services and operations set... This concludes the Air Asia maintains its image in the market by the... Similar service provided among every airline company in the future is networking 9 consecutive years the. Airasia is the largest low-fare airlines and AirAsia have a vast network operations... As Australia, France, Iran, South Korea and new Zealand have established myself multiple. Good relation with hotels and tourism companies around Asia organisation is performed using Porters Five model..., Phillipines, Japan, 5.It has a fleet size of 92 to the industry and Assess forces...
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