AirAsia is the largest low-fare airlines and rapidly growing in Asia since 2001. Switching Cost is low. Do essay writing needs professional writers? This company also focuses on providing the accessibility-based promotions in which the customers are informed about their new products and services by using simple tools of promotion, such as email. In order to stay ahead of the competition, the company needs to constantly invest in improving the additional facilities that make a difference to customers in todays times such as disposable in-flight meals, complimentary WiFi, entertainment facilities, and varied seat options. Quizzes test your expertise in business and Skill tests evaluate your management traits. Registered office: Creative Tower, Fujairah, PO Box 4422, UAE. Best regards from Kazakhstan.My name is Ainash. The low lost product is the primary product of the marketing mix strategy that is used by the company. It is thus very well known in its market for being one of the most feasible. AirAsia X aimed to ensure high frequency and point-to-point networks to the businesses situated at long distances. Revenue performance has greatly improved with sales across the group up 57% this week versus the preceding week, supported by the latest Rising Labour Costs 3. Some of the key weaknesses of Air Asia are: Opportunities refer to those avenues in the environment that surrounds the business on which it can capitalize to increase its returns. 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 AirAsia has 5 employees at their 1 location and RM1.84 b in annual revenue in FY 2021. Increasing globalisation has led to an increase in the lifestyle and financial condition of people. The companies are not associated with MBA Skool in any way.Edit the brand or add a new one to SWOT Analysis section : Contribute. Basic things to know before seeking help in assignment. Lets see how they compare amongst a few key indicators. Furthermore, the renovation, development and reconditioning facility is also partnered with other organisations. The flights cover a wide area of diverse countries and focus on further expansion of its coverage. 2.1.2 Pest Analysis PEST analysis is a useful tool for scanning the general environment. With the increasing number of services by different competitors, AirAsia has also expanded its facilities including the tour packages and hotel booking services that help the company to sustain in the market. The cost-cutting strategies of AirAsia are effective and beneficial in terms of financial growth and maintenance (Ahmad and Neal, 2006). The opportunities for any brand can include areas of improvement to increase its business. AirAsia X share began trading on Bursa Malaysia, formerly known as the Kuala Lumpur Stock Exchange, on 10-Jul-2013. This isbecauseof increased globalisation among industries and travelling, and the tourism industry has been severely affected by it. It was started in 1993, and the operations began in 1996. in the worldTherefore, in the increasingly competitive market, AirAsia flies to more number of destinations in comparison to its competitors. - Strong brand recognition - Airasia products have strong brand recognition in the Airline industry. Performance of rivalry. Porters five force analysis for Air Asia is as under: Bargaining power of Supplier Analysis of the bargaining power of suppliers is crucial for any organisation, as with the help of this, an organisation manages the capital and makes decisions regarding financial management (Thomas and Housden, 2017). The verdict overturned the Malaysian Competition Commission (MyCC) ruling that AirAsia and Malaysia Airlines (MAS) had colluded to share the market. Low Cost Model: Low cost operations and fixed costs . Brands, such as Jet Star Airways and Tiger Airways, are sustaining in the competition as they also provide air transportation at cheap costs to people along with enhanced in-flight services and varied options for passengers.This directly affects the customer strength of Air Asia, andthese companiespose a threat to the company. The bargaining power of buyers is strong because most of the customers for Airlines Company are individual travellers instead of travel in group. Air Asia uses direct sales methods, such as sales through the internet, call centres, and walk-in airport sales. The Essay Writing ExpertsUK Essay Experts. Copyright 2003 - 2023 - UKEssays is a trading name of Business Bliss Consultants FZE, a company registered in United Arab Emirates. Airasia had expanded its services provides to hotel booking as it already has its own hotel (tune hotel) which located not far away from its airport, and tour packages. The airline offers400destinations both local and international in25countries across the world. *You can also browse our support articles here >. Lead Trainer & Head of Learning & Development at IIDE, Leads the Learning & Development segment at IIDE. This strategy of networking is beneficial for Air Asia and every organisation, as it helps the company to have a thorough analysis of market and sustain in the market (Abdullah, Chew and Hamid, 2017). This may makes the industry very competitive. Its other main competitor, Malaysia Airlines , serves Kota Bahru and Singapore but dropped Bandung in late 2011. This has been possible through excellent brand positioning. Some of the opportunities include: Threats are those factors in the environment which can be detrimental to the growth of the business. Air Asia PESTLE Analysis examines the various external factors like political, economic, social, technological (PEST) which impacts its business along with legal & environmental factors. Heres the swot analysis of AirAsia as follows; AirAsia has a large fleet size comprising300aircraft. The adaptable quality of the employees with changes and amendments ensures ease in amending and improvising the operations of the organisation (Lim. Its going to analyze the internal and external factors impacting the worlds leading low-cost airline. Service or performance may include accuracy of takeoff time, aircraft performance and staff services. Air Asia maintains its image in the market by choosing the right set of employees depending on their capabilities (Shaw, 2016). The brand names and other brand information used in the SWOT Analysis section are properties of their respective companies. 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. It is also because they are providing same service to the customer which is sent their customer to their destination by flight. Furthermore, landing charges can be identified as the negative aspect resulting into underdevelopment of the airline industry as the aviation sector is strictly obligated to abide by precise air rights regulations and norms. The important thing the buyers look for is the fly to destination which shows the strong bargaining power of buyers. The increasing fuel cost and the labor cost have amplified the overall expense of AirAsia. In contrast to this, Jet Star Airways has more types of planes that are provided to its customers that includes A320, Bombardier Q300, A321 and Boeing 787 Dream Liner; whereas AirAsia offers only two types of planes to its customers, which are A330 and A320. Air Asia has established itself as a strong competitor in the airline industry. 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. WebThe two closest competitors that are considered against AirAsia include Jet Star Airways and Malaysia Airlines (AirAsia, 2018). The AirAsia Big Loyalty Program is one of the companys most popular campaigns, in which affluent customers win BIG points for any purchase they make and redeem those points for free airline tickets. Other than that, hes a fun loving person. As we know that Asia has established a reputation as LCC (low-cost carrier) airline in the Asian and global market. Like Worlds Best Low-Cost Carrier Award for 11 years in 2019, highest airline brand value in Asia, and many others. Continue reading more about the brand/company. Moreover, there is also a competition between the rivalries for the routes in which they services in comparison to AirAsia. Thai AirAsia, Indonesia AirAsia, Philippines AirAsia, and AirAsia India are its affiliate airlines, while AirAsia X, its sister carrier, focuses on long-haul routes. Exit Cost is high. It was named as the Best Low-Cost Airline Company in the world for 9 consecutive years at the Skytrax World Airline Awards. The major issue with maintaining low ticket price is the increasing competition in the airline industry. Furthermore, the company wants to serve the 3 billion people who are currently out of connectivity and cannot afford high fares. Another important strategy that Air Asia will consider enhancing is improving Information Technology (IT) services in the company, as well as in the aeroplanes. The distribution channels for the tickets include different sources such as internet ticket booking, exclusive reservation, and sales offices along with the agents that are authorised by the company. Moreover, the performance of the rivalry companies also affects the business of Air Asia as there is no remarkable difference in the services that are provided by Air Asia and other companies. All work is written to order. Additionally, competitive analysis is conducted for AirAsia, which is used to determine the strengths and the weaknesses of AirAsias competitors. AirAsia X joins AirAsia Berhad and Thai AirAsia with stock listings. Government regulations which target various aspects such as particular routes, landing permissions and share possession cause a drastic impact on the operations of the organisation. 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. The company develops the products and services that are convenient for its customers (Mele, Pels and Storbacka, 2015). Jet Star Airways provides more than 80 destinations that include Asia Pacific, Australia and Honolulu in America. But the company is only operating its business only in 25 countries. According to a report by The New York Times in 2007, it described AirAsia is the low-cost pioneer in the airline industry. As the rivalry is strong, Airasia may constant in price reduction to compete with them. It would be a strong competitive edge to AirAsia after the pandemic ofcovid-19because the purchasing power of the people has dropped significantly. If you did, be sure to share, comment, and let us know! It offered a new definition of affordable traveling with its Tagline Now Everyone Can Fly. The organisation has outsourced its maintenance and repairing facility as it does not possess in such facilities. SilkAir 3.Tiger Airways Hence this concludes the Air Asia SWOT analysis. SWOT analysis of Air Asia analyses the brand by its strengths, weaknesses, opportunities & threats. Bargaining power of Buyers The buyer power for Air Asia is analysed to be high as with increasing options in the international market and decreasing prices of air tickets, people of every category of society can afford flying, and hence, the bargaining power of buyers is also high. However, the low-cost airline has made partnerships and alliances with AirAsiaChina, AirAsiaVietnam, AirAsiaJapan, AirAsiaIndia, AirAsia X, and others. In order to establish a new airlines company, high amount of capital along with risk-bearing capabilities and monetary funds to cope up with the challenges faced while sustaining in the airline industryare required. Air Asia is known for treating its employees and customers well. Thus, the bargaining power of suppliers is analysed to be low (Man and Justine, 2005). The organisation can be witnessed to confront critical competition from the competitors who are facilitating similar costs and additional services and privileges which act as a drawback for the organisation (Man and Justine, 2005). Let us now get into its marketing strategy. Jet Star Airways is a low cost Australian airlines services head-quartered in Melbourne. Air Asia implements the strategy of networking in order to maintain sustainable relationships with its suppliers, as this helps the company to maintain a significant level of customer satisfaction and customer loyalty. Student Life Saviour 2022 - All rights reserved. It has subsidiaries in Indonesia, Thai, Phillipines, Japan, 5.It has a fleet size of nearly 300 aircrafts. The basic product strategy in its marketing mix is its low-cost air services. Since the airline brand follows the tight costing strategy and it allowed the company to offer cheap fare to the customers. This tells us that AirAsia mainly needs to understand its customers a little better and provide them with the extra services they need. Required fields are marked *. Direct competitors market the same product to the same audience as you, while indirect competitors market the same product to a different audience. Fixed Cost is high. 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. AirAsia is a Malaysia-based aviation company that owns and operates jet aircraft that offers scheduled passenger and cargo transportation services. This reduces the chances of small or medium enterprises to enter this industry, and hence, the threat of new entrants for Air Asia is very low. The approach towards technology assists the organisation in minimising risks and problems and facilitating enhancement in customer services. It mainly operates on a large scale domestic networks, regional and international services to its customers. The population of Asia is accounted to possess a massive number of middle-class individuals who can afford the airlines and opt for low-cost flights to save time and money. The market has confronted critical competition in the form of new competitors who have also introduced low-cost flights. Following are the opportunities in Air Asia SWOT Analysis: 1. It must have a good relation with hotels and tourism companies around Asia. Air Asia Revenue : RM 10,638 million (FY 2018) (9.6% increase YoY) RM 9,710 million (FY 2017) Competitive Analysis of Air Asia SWOT PESTLE The SWOT analysis of Air Asia is presented below: Air India, Emirates, and many other Asian airlines have also started following the low-cost carrier strategy to attract market share. Now, the brand should amplify its marketing and promotional campaigns to attract the Indian price-conscious market. The threats in the SWOT Analysis of Air Asia are as mentioned: 1. The Indian market is highly price-conscious. AirAsia can collaborate or establish a joint venture with competitors to minimise competition and expand growth and profit opportunities (COM, 2017). In addition to this, various political factors can be highlighted by influencing the operations and management of AirAsia which have been mentioned below. Under which they asked customers to take a pledge to be conscious of not wasting paper and thus carrying all their travel documents digitally, Festive marketing is also practiced by AirAsia whereby they wish their customers on various festivals and also sometimes provide exclusive offers, On its Instagram, the company has an ongoing #HumansofAirAsia campaign that gives us insights into their employees lives and day-to-day activities on their jobs, On the companys Twitter handle a lot of information regarding travel guidelines, advisories and other details are shared for the customers knowledge, Liked our work? Do you have a 2:1 degree or higher? 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. Share, comment, and others only operating its business only in 25 countries the situated! With the extra services they need Bandung in late 2011 to this, various political can. 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