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MKTG1203 low-cost airline market prezi presentation

MKTG1203 prezi presentation

Kayla Paul

on 1 November 2013

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Transcript of MKTG1203 low-cost airline market prezi presentation

Low-Cost Airline Market
This market focuses on offering a product with cheaper ticket fares compared to its competitors.
Brands typically only charge consumers for what they need and give them the option to add on extras.
This allows the consumer to build their own "flight experience".
Our three focus brands
Product Offering:
"A product is a good, service or idea offered to the market for exchange. Unlike physical goods, services are experienced rather than owned."
Total Product Concept:
Augmented Product
Expected Product
Core Product:
At the very basic 'core level', each brand offers a flight service from departure to destination.
Potential Product:
Consumers start to create social expectations about the product; this is known as the expected product.

This Includes:
-a plane
-safe handling of luggage
-on time arrivals/departures
-high safety
-a plane seat
-seat belt
-a pilot

, the potential product includes a movement towards challenging Qantas in the business and premium marketplace through expansion of their brand and an increase in market share.

, potential products include repositioning and strengthening their brand which will in turn aim to increase their market share and expand their businesses.

There are many different ways in which the consumer can alter their ‘flight experience’ or what marketers term the ‘augmented product’. This is the level of product offering brands most often compete on because it allows differentiation from their competitors.
Augmented Product
Cheap Flight deals
Travel insurance
Car rentals
Holiday deals/packages
Special deals
Loyalty Program
Business Class

These Include:
A larger window size
In-flight entertainment such as new release movies,
TV shows, NOVA radio, and over 50 albums
LED mood lighting
Larger seating space
Reduced turbulence
Lower altitude cabin pressure to decrease the effects of jetlag
Better air filtration
20% less fuel and air pollution.

In our recommendations we will look at the potential product for Tigerair.
The Product Lifecycle
Extras for Business class:
Increased baggage
Priority boarding
Improved food
Personal entertainment
Provided with comfort pack (pillow, toothbrush etc)
Coat check service
Consumer Behaviour:
1. Problem Recognition
(buying satisfaction to a problem)
Relies on Primary Demand
Flight time is seen as a burden or lost time
Air travel dominating service provider
Need to create Selective need recognition like securing
an exclusive destination contract creating secondary demand
“Positioning describes how target markets perceive the organisation’s offer relative to competing offers.” (Elliot, Rundle-Thiele & Waller 2012, p.184)
Established in 2003, Tiger has four airlines in Singapore, Philippines, Mandala and Australia to over 50 destinations in 13 counties in the Asia Pacific region.
Non-Habitual Process
High Risk which also leads to high class association
“all day, every day, low fares”.
The new Dreamliner is proposed to be bigger providing more space, with bigger windows and the latest engineering design that will make the new aircraft more cost efficient.
Information Search
Flight is at the base of the funnel, final obstacle for travel
Competition grouping sites such as webjet force prices lower and lower with increased competition.
Offering low cost flights to people who may never before had the chance to fly.
Now Virgin is attempting to extend its market towards business people.
Low Prices can stimulate an impulse buy
Takes out Monetary Risk
Virgin is also looking to expand into the “fly in fly out” market of the mining sector particularly in Western Australia.
Tiger airlines are not as competitive as Virgin and Jetstar as it recovers from years of scrutiny.
It is commonly perceived that Tigers extremely low prices come at a huge cost in service quality.
However recently
have entered into business with each other and Tiger are looking to re-launch their airline. They plan to do this by starting again from the basics and building their brand from there.
Personalised Marleting through emails is very powerful in driving primary search to a low cost airlines website
Have to know information about the consumer
such as email, location and interests.
Alternative Evaluation:
Entertainment Systems:
Food and Beverage Service
Baggage Allowances
Alternative Evaluation:
Price is still the predominant factor
core product
expected product
augmented product
potential product
Extra leg room for 'activities'
Jetstar's Boeing 787 Dreamliner has many augmented features of which exceed the luxuries of a standard plane.
Purchase/Post Purchase Outcomes
Self- Check in
Including emailed Boarding Pass
Ensure Plane departs
on time.
Ensure staff are friendly
and helpful
Tiger's partnership with
has ensured the business won't go down and has allowed the brand to take risks such as offering competitive prices.
In an online article recorded a
32% pre-tax fall of 138 million
for Tiger for this last financial year attributed to “the competitive domestic market and additional start-up losses” (O’Sullivan 2013).
This could mean that Tiger is in its maturity stage of the product lifecycle yet Elliot, Rundle-Thiele & Waller state that in order to make a profit, a company must first make a loss (Elliot, Rundle-Thiele & Waller2012), which is why we argue that Tiger is still in the
latter growth stages
and not in the maturity stage.

images or symbols that identify goods
Brands create a 'point of difference' between competitors which allows the consumer to differentiate between similar products
Brands and the images associated with them create triggers for the viewer
which can be positive or negative
conveying feelings and ideas
The Tigerair rebrand aims to rebuild consumer confidence, revive the Tiger brand and create more competition within the low cost airline market
The goodwill associated with a brand is imperative to how a customer relates to the product
What factors are important in creating a strong brand presence?

medium/platform used
Use of preconceived ideas

Marketing communications defines the role of promotion in creating and maintaining relationships with target marketers.
Recommendations for Tigerair:

After analysing the three brands we believe that Tigerair has the potential to grow further in this market.
We suggest combining the first two recommendations, cobranding and the new Dreamliner into a Facebook "like and share in order to win" promotional material.

Recommedation 1: "who says?"

Who says Tiger can't also acquire new consumers and expand their brand by investing in the Boeing 787 Dreamliner?
We suggest utilising celebrity endorsement to join 'Step Brothers'' star Will Ferrell in Tigerair's new promotional advertising campaigns.
The financial hit to Tiger has essentially been a hit to the Virgin brand pushing it into the
late growth and early maturity phases
of the product lifecycle.
Virgin reported annual loses for the 2013 financial year of 98.1 million (the carbon tax heavily influencing this) (Virgin Australia 2013). Adopting Tiger had expanded Virgin’s network but as profits started to decline Virgin needed to proceed with their rebrand which came in 2011 and 2012.
Jetstar can also be classified in the growth stages of the product lifecycle because it is still yet to dominate the market
Ensure an increase in prospective sales and customer loyalty
Not only would the excitement of a new and revolutionary plane boost the sales of flights but the planes can be afforded on a very similar profit margin that is currently in process at Tiger.
By adding a new airline to the company, Tiger will be competing on an augmented level in a market that is heavily dominated by expected services.
What the Dreamliner will do for Tiger:
New wing design that helps decrease drag and increases the speed and performance of the plane.
This will also help reduce fuel consumption of the aircraft compared to other similar aircraft.
Wings are also fitted with fly by wire control systems which allow the pilots control of the plane through electrical impulses which also give the plane the ability to make adjustments for a smoother flight and again help improve fuel consumption efficiency.
Other Features of the Dreamliner:
By getting more value from fuel and maintenance Tiger will be able to be more competitive in their prices while providing a very high quality aircraft without having to sacrifice other flight services.
The idea of being more comfortable and relaxed on a flight experience which then leads to a lower jet lag and an increase in value for money as the passenger may not be lethargic or nauseous on their holiday is very positive.
Our marketing strategy: "cheap doesn't mean cheap quality."
Recommendation 2:
"if you can't beat em', join em'."
Recommendation 3:
"expand the name, expand the brand."
By encouraging students to share the picture with their friends, Tiger would be creating opportunities for brand awareness and furthering their consumer relationships.
We believe that these recommendations will not only help improve Tiger’s brand image and brand equity, but it will also help create, encourage and target new students to become involved with Tigerair and hopefully form long-lasting consumer relationships.

Because of Tiger’s position in the low-cost airfare market, we think that the business will benefit most by taking on a new advertising scheme incorporating a newly acquired aircraft and celebrity endorsement.

The new Dreamliner will be an investment that will reach out beyond Tigerair's target audience of students and embrace new consumers as well as old.
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