Recommendation and Conclusion
Based on this analysis, our recommendation focuses on three main areas: 1) A Blending of Brands: AirAsia has established a great name and reputation, and should continue to add to its success by integrating the AirAsia X brand. This can be achieved by the “X” representing premium choices on long-haul flights. This will this ease brand confusion by having only one Air Asia brand with extra (X) options, and will present a strong united front. 2) Implement Long-Haul Flights Strategically: AirAsia has the ability to provide long-haul flight at lower costs than other airlines, and therefore Air Asia should expand its long-haul flights. However, they need to expand in this direction very strategically as to not disrupt their low cost strategy. This can be achieved by providing flights to places with similar culture and way of life, and to places of similar geographic conditions. 3) Remain one of the “Cost Leaders”: Because one of Air Asia’s main competitive advantages is being able to provide flights at low costs, there should be a high priority placed on keeping unit costs low while expanding. This can be achieved by maintaining their already existing “cost conscious” policies and decision making.
AirAsia should stick to its vision to run long-hauls because the company has the capacity to offer these flights at lower costs than competitors. An amalgamation of the AirAsia and AirAsia X brands will reduce brand confusion. However, it is important to expand strategically to keep their LCC strategy strong. We suggest that AirAsia limits its long-hauls to countries with favourable weather conditions and also to countries with a similar culture and economy.
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