Airasia Case Study

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Marketing Report

Case Study 2: AirAsia

Lim Jia Chi (CEA120042)

Mohd Hafizi Bin Mohd Zaki (CEB090032)

Nur Hidayah Binti Ruslan (CEA120073)

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Introduction

            In general, for our group topic case study 2, AirAsia: the sky’s the limit, we will answer 4 questions which related with our study outline analyzing the market.

First and foremost, we will discuss the micro and macro environmental factors that have contributed to the early success of AirAsia. In this topic, we will define clearly the factors related with some explanation and provide some relevant example related to the case study.

Secondly, we will explain the micro and macro factors that would affect AirAsia’s performance in the current competitive environment described in the case. For this question, we will describe in details the environmental forces that affect the company’s ability to serve its customers in the current competitive environment.

Thirdly, we will analyze that by focusing on low prices, has AirAsia pursued the best strategy? If they do pursued with the best strategy, how they make it and why? If they do not pursued with the best strategy then what are the reasons? Besides, we will see how AirAsia analyze these environments to better understand the marketplace and consumers.

Finally, given AirAsia’s current situation with bigger competitors following its business model, we will give some suggestion and recommendations through our own opinion with the relevant statements and examples to CEO Tony Fernandes for the future of his company.

QUESTION 1

What are the micro and macro environmental factors that have contributed to the early success of AirAsia?

Microenvironment factors                                                                                                                                

1. Customers

              Customers are the most important microenvironment factor. Customers can be classified as consumer market, business market, reseller market, government market and international market. The company needs to target their own market to deliver the customer value and building customer relationship.

               AirAsia captures their consumer markets who are individuals and households that purchase their airline services for travelling purpose for example from Kuala Lumpur to Kota Kinabalu for domestic airline. A success in building customers network contributed to the early success of AirAsia.

1. The Company

              Company consists of top management, finance, research and development (R&D), purchasing, operations and accounting that build up the internal environment. All of these interrelated groups will work together to design the marketing plans and marketing management. Top management sets the company’s mission, objectives, broad strategies and policies. Marketing managers make suitable decisions according to the strategies and plans from the top management.

              Inside the company, all the departments will work together to achieve the objectives. In our case study, the top management of AirAsia is is Group Chief Executive Officer Dato’ Sri Dr. Tony Fernandes and his three partner and senior management in Malaysia, Thailand and Indonesia. This senior management develop a new Low Cost Carriers that achieve people’s travel dream. Due to the good internal environment, now AirAsia are success to be one of the world’s best low-cost airlines.

1. Suppliers

              Suppliers are essential in the company’s overall customer value delivery network. Suppliers determine the success of the company to obtain resources needed in the process of production of goods and services. Supplier problem may cause serious effect on the marketing. For example, supply shortage will affect the customers’ satisfaction in long-run.

                AirAsia always ensure that supply shortage such as food and fuel would not occur because they understand the importance in maintaining a good relationship with the supplier. For instance, AirAsia maintaining a well partnership with Shell so they won’t face the fuel shortage for every flights. So, values the suppliers as partners very important in maintaining the customers’ satisfaction while creating and delivering customer value.

1. Marketing intermediaries

              Marketing intermediaries include reseller, physical distribution firms, marketing services agencies and financial intermediaries. They help the company to introduce, promote, sell and distribute its product to the final buyers.  Reseller is the distribution channel firm that helps the company to win customers and make sales. Physical distribution firms help the company stock and move the goods. Marketing services agencies help the company to target their market. Financial intermediaries include bank and credit companies deal with finance transactions which involved buying and selling goods.

              AirAsia’s marketing intermediaries help AirAsia to sell the flight ticket in some authorized travel agents to the customers that are unfavorable to purchase their tickets through online booking. Besides that, AirAsia also provide transaction services through online banking with their own financial intermediaries such as HSBC Bank, Maybank, and CITIBank. Payment by cash can also be made at any Alliance bank branch in Malaysia. All of these intermediaries help AirAsia stepped to success in contribute AirAsia Low Cost Carriers services.