For our marketing plan, we’ll focus on Jetstar Australia domestic operation.
Product Category| Key Product| % of Revenue|
Short Haul| JetStar Domestic| 57|
Long Haul| JetStar International| 43|
Jetstar is a low cost carrier that caters for people on a limited budget. Its target market is domestic leisure traveller particularly form eastern seaboard.
Domestic overnight leisure travel (holiday and visiting friends and relatives) is the largest and most valuable segment of Australia’s tourism market. In recent years however the market has been in decline. On a per capita basis, people have been spending fewer nights away and spending less on domestic overnight leisure travel. More recently there is some evidence of leakage from domestic to outbound leisure travel, particularly for holidays.
Various economic and social factors have contributed to this steady decline in domestic overnight leisure travel. Among these are:
• Higher levels of personal and household debt
• Changing household consumption patterns (with increases in areas such as Communications, Household Goods, Furnishings and Health); • A decline in the affordability and competitiveness of domestic travel (appears to be most pertinent for young singles and older non-working people); • Leakage from domestic to outbound holidays (particularly among young and midlife singles and couples along with residents of Sydney and Melbourne); and • Changes to the labour market making domestic travel more difﬁcult (includes increased casualization of the workforce and continuing long working hours).
Basis of Competition
The competition in the Australian airline market is tough. Fierce completion between rival budget operators Virgin Blue and Jetstar has turned into a race to the bottom, with fares being offered for as little as a dollar in an effort to fill seats. Both major player temp to get market shares and at the same time try to reduce costs in order to overcome the rising fuel prices.
At the moment the Australian domestic passenger industry is dominated by three large domestic carriers: Qantas, Jetstar and Virgin Blue.
Competitors| Competing Products| Level of threat posed|
Virgin| Domestic/International leisure travel| High|
Tiger Airways| Domestic/International leisure travel| Medium| Regional Express Holding| Domestic leisure travel| Low|
Skywest| Domestic leisure travel| Low|
Qantas Link| Domestic leisure travel| Low|
Virgin Blue Holdings Limited is the holding company that operates Virgin Australia, formerly Virgin Blue Airlines. The holding company's airline services encompass Virgin Australia, Pacific Blue, Polynesian Blue and V Australia. Virgin Blue started operations in Australia in 2000, offering no-frills cheap air travel between capital cities around the country. The company had support from federal, state and local governments, which provided incentives for Virgin Blue to service routes that would otherwise be subject to high price monopoly. Virgin Blue participates in the industry through its domestic flights. Regional Express Holdings
In August 2002, Regional Express (Rex) was formed by a pilot-led consortium under the company Australiawide Airlines. Rex represents the merger of former Ansett country carriers Kendell and Hazelton, which were acquired by Australiawide Airlines in April 2002. Rex provides regional air services in country Australia. Interconnecting with Virgin Blue, Qantas and Singapore Airlines made its success possible. The company operates in the industry through its scheduled regional air transportation operations. Skywest Airlines
Airline Investments acquired Skywest Airlines, formerly a...