Air Asia Project Report

Topics: Airline, AirAsia, Low-cost carrier Pages: 15 (3341 words) Published: December 13, 2014

Entry strategy for Airasia
Marketing Management

Table of Contents
Objectives………………………………………………………………………………………………………………….3 SWOT Analysis4
PESTEL analysis5
Market Segmentation and Target Market6
Positioning7
Pricing Strategy8
Placement Strategy:9
Promotion Strategy:9
Conclusion……………………………………………………………………………………………………………………………………… 11 Appendices12
References……………………………………………………………………………………………………………………………………..14

AirAsia is a Malaysian low-cost airline headquartered near Kuala Lumpur, Malaysia. AirAsia group operates scheduled domestic and international flights to 100 destinations spanning 22 countries. Its main hub is the klia2 (LCCT) at Kuala Lumpur International Airport (KLIA). The affiliate airlines are Thai AirAsia, Indonesia AirAsia, Philippines AirAsia, AirAsia Zest and AirAsia India .AirAsia X only focuses on long-haul routes. AirAsia's registered office is in Petaling Jaya, Selangor while its head office is at Kuala Lumpur International Airport.

10 years on after taking a bold chance to start a low cost airline, AirAsia’s CEO Tony Fernandes has built AirAsia from two planes to 115 aircraft today, flying to more than 400 destinations spanning 25 countries, making the slogan “Now Everyone Can Fly” come true. It operates with the world's lowest unit cost. It has hedged 100% of its fuel requirements for the next three years and achieves an aircraft turnaround time of 25 minutes whereas for others it is 45 minutes to 1.5 hours. AirAsia has a crew productivity level that is triple that of Malaysia Airlines, and achieves an average aircraft utilization rate of 13 hours a day which is 1.5 hours more than the industry average.

Corporate Objective:
In the next five years we aim to be the market leader in LCC segment of Indian Aviation industry. Marketing Objective:
1.In two years duration we aim at converting 30% of our Facebook fans at our AirAsiaIndia page into delighted customers and simultaneously add to our fan base at 10% growth each year.
Situation Analysis:
Tata’s are the largest and most respectable conglomerate in India and are involved in businesses as diverse as steel to software and from tea to telecom. What they were not able to do thus far is to have a slice in the aviation pie of the country which is expected to be amongst the most untapped and unexploited aviation markets of the world besides being one of the fastest growing big aviation markets. According to Centre for Asia Pacific Aviation (CAPA) data for 2012, per-capita domestic airline seat in India was very low, at just 0.07. In comparison, the number stands at 3.35 in Australia, 2.49 in the US, 1.38 in Canada and 1.05 in Japan. Presently the Indian Aviation has a size of $16 billion and in the top 10 worldwide. It is projected to become the 3rd largest international player by 2020 and the largest by 2030. It therefore, did not raise many eyebrows when Tata’s picked up a stake in AirAsia's India venture. As for Air Asia which has business model as low cost carrier (LCC), flies to 85 destinations in 20 countries (from Thailand and Malaysia to five Indian cities), and has a fleet size of 118 aircraft, with Indian market share of 0.80% before this JV, wanted to increase its footprint in the high growth Indian LCC space. As 60 per cent of Indian aviation industry is held by LCCs, it makes sense to be in this segment. Because it is the lowest cost airline of the world (barring fuel cost) AirAsia can surely expect to be successful in India as it has a sound business model, economy of scale and a leading position in the high growth Asian region which is increasingly attracting Indian tourists. Because of the same reasons, it can also compete with full service airlines flying between India and various Southeast Asian destinations as these are short to medium haul routes.

Its competitors include but are not limited to the following LCCs - Indigo, Spicejet, GoAir with Indigo being the market...

References: Reinventing the booking cycle to drive revenue (2011). Simplifying.com Retrieved from http://simpliflying.com/2011/top-10-travel-distribution-initiatives-by-airlines-how-airlines-are-reinventing-the-booking-cycle-to-drive/
Book AirAsia by SMS (2003). Travel Weekly Web. Retrieved from http://www.travelweeklyweb.com/book-airasia-by-sms/2469
CII KPMG Indian Aviation Report (2012). KPMG Aviation Report. http://www.kpmg.com/IN/en/Press%20Release/Press-Release-Indian-Aviation-Report.pdf
Air Asia India (2014). Wikipedia. http://en.wikipedia.org/wiki/AirAsia_India
Air Asia announces two new routes (September 11, 2014). Business Standard. http://www.business-standard.com/article/companies/airasia-india-announces-two-new-routes-plans-to-add-5-more-aircrafts-before-november-114072401124_1.html
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