This situational analytical approach on Virgin Australia domestic business class product and its ambitious ‘Game Change’ strategic plan elict a comprehensive descriptive research data of the product, distribution, competition, target market and macro environmental situations which are exploited with SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis. The objectives draw out three main marketing issues- cost control, improvement to competitive advantage without lowering pricing alone and strengthening its position as a full service carrier. Those factors that affect the product’s performance can then generate new insights and strategies about the product sustainability in the dynamic characteristics of demand and the proliferation of the airline market segments.
The essence of the Game Change strategic plan involves activities that are different from the incumbent airline. This differentiation is important in order to knockout its competitive advantage over rivals. Virgin must compete using its valuable tools and unique value based on a tailored mix of activities that differentiate it from rivals but not lowering its pricing alone to attract travellers.
The ethos of Virgin Australia’s vision is the ‘choice of airline’ that must match into the new business model in the marketing process. To support this view, fundamental changes are being embedded and underway according to plan which requires a different business model and interactions. Virgin has opted and entered into the growth strategies of product development and diversification through product/brand extension. The business class product is an example of brand extension which will be discussed.
Table of Contents
1. Introduction
2. Virgin Australia- Company snapshot
2.1 The emergent of a new low cost carrier-Virgin Blue
2.2 The Game Change strategy and a new name- Virgin Australia
2.3 Financial proposition and corporate vision
3. Product overview
3.1 Sydney-Perth business class product overview
4. Strengths and weaknesses in the present marketing mix
4.1 Product
4.2 Promotion
4.3 Price
4.4 Distribution
5. The market situation
5.1 Identified target markets
5.2 Size of Target Markets
6. The product situation
6.1 Product and brand recognition
6.2 Market share
6.3 Product Sales
6.4 Product issues- Costs and pricing
7. The distribution situation
8. The Competitor Situation
9. Macro environment situation
10. The SWOT analysis
11. Identification of main issues
11.1 The tradeoffs between pricing and profitability
11.2 ‘Choice of airline’: Something not much different
11.3 Effect of communication technology
11.4 First class value at the price of business class
11.5 Loyalty as a long term relationship
12. Conclusion
Objectives and Core Topics
This report provides an in-depth situation analysis of Virgin Australia's transition to a full-service carrier via its "Game Change" strategic plan, specifically focusing on the Sydney-Perth business class market. It evaluates the company’s competitive position and identifies key marketing challenges related to profitability and brand differentiation.
- Evolution of Virgin Australia from a low-cost carrier to a full-service airline.
- Comprehensive SWOT analysis of Virgin Australia’s current operations.
- Market situation, competitive landscape, and macro-environmental factors.
- Strategic marketing challenges: balancing cost control, pricing, and brand loyalty.
Excerpt from the Book
3.1 Sydney-Perth business class product overview
The product offers a direct route from Sydney-Perth, a journey about 5 hours and 20 minutes flight time over a distance of 3300 kilometres (Virgin Australia, n.d.). Travellers on this city pair choice can choose from any thirty four flights per week. They are given the flexibility to change their reservations without additional costs. The cabin configuration is based on the economic viability of mixed business (27 seats) and economy classes (251 seats) layout for the Airbus 330; while 8 seats are business and 168 seats are economy on the Boeing 737-800.
Virgin offers intangible attractive perks like in-flight entertainment, wider pitch seats and tangible service with a reputable chef special gourmet to reflect a high quality of standard in congruence with other Virgin brands. The aircrafts interior are retrofitted to two classes configuration, thus providing the opportunity to segment business class services targeted at individual, corporate and government travellers. This “market orientation” implies that Virgin focuses on its activities and to augment its product in creating an array of pre-departure benefits and in-flight indulgence (Narver & Slater, 1990, p. 21). Moreover, this creates a sustainable superior value that may exceed the expected value of any substitutable solution for the business travellers
Summary of Chapters
1. Introduction: Outlines the scope of the situation analysis, focusing on Virgin Australia's shift to a full-service business model.
2. Virgin Australia- Company snapshot: Details the history of Virgin Blue and its transformation into Virgin Australia under the 'Game Change' strategy.
3. Product overview: Examines the specific offerings of the Sydney-Perth business class route, including cabin configuration and service perks.
4. Strengths and weaknesses in the present marketing mix: Analyzes the four P's (Product, Promotion, Price, Distribution) within the context of the current business strategy.
5. The market situation: Discusses the target demographics, market size, and growth trends affecting business air travel.
6. The product situation: Evaluates brand recognition, market share, and the financial performance of the business class product category.
7. The distribution situation: Reviews the evolution of Virgin's booking and reservation technology, including the transition to the Sabre network.
8. The Competitor Situation: Compares Virgin's strategy against Qantas, highlighting competitive pressures and recent industrial relations impacts.
9. Macro environment situation: Identifies external factors like fuel costs and telecommunication trends that impact the airline industry.
10. The SWOT analysis: Summarizes internal strengths/weaknesses and external opportunities/threats facing the company.
11. Identification of main issues: Analyzes critical challenges, including pricing-profitability tradeoffs and the importance of long-term loyalty.
12. Conclusion: Summarizes the effectiveness of the 'Game Change' program in securing Virgin Australia’s future competitiveness.
Keywords
Virgin Australia, Game Change, business class, situation analysis, strategic plan, airline marketing, full-service carrier, SWOT analysis, competitive advantage, market segmentation, brand extension, corporate travel, pricing strategy, customer loyalty, Qantas.
Frequently Asked Questions
What is the primary focus of this report?
The report provides a detailed situation analysis of Virgin Australia, focusing on its strategic shift from a low-cost carrier to a full-service airline through its 'Game Change' initiative.
What are the central themes explored in the text?
Key themes include competitive market dynamics, product development, brand strategy, the impact of macro-environmental factors, and the challenges of balancing service quality with profitability.
What is the main objective of the 'Game Change' strategic plan?
The primary goal is to establish Virgin Australia as a 'choice of airline' for business travellers, moving beyond purely low-cost strategies to compete effectively as a full-service provider.
Which scientific or analytical methods were applied?
The author uses descriptive research data, an internal and external environmental scan, and a structured SWOT analysis to evaluate the company's performance and market position.
What does the main body of the report cover?
It covers the company history, specific product details for the Sydney-Perth route, analysis of the marketing mix, competitive benchmarking against Qantas, and an investigation into major issues like fuel costs and pricing.
Which keywords best describe the document?
The work is defined by terms such as Virgin Australia, Game Change, business class, SWOT analysis, competitive advantage, and airline marketing.
How does the author analyze the competition?
The report benchmarks Virgin Australia against Qantas, noting the incumbent's larger fleet, market share dominance, and the impact of operational challenges like industrial action on Qantas.
What is the significance of the Sydney-Perth route in this analysis?
This route serves as a practical case study for Virgin's business class offering, demonstrating how they compete on service quality, brand value, and scheduling against established rivals.
- Citar trabajo
- Kok Meng Chan (Autor), 2012, Virgin Australia: Situation analysis of the ‘Game Change’ strategic plan, Múnich, GRIN Verlag, https://www.grin.com/document/209340
