Final Assignment In Markets And Marketing Business Essay

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2. Strategy allows Ryanair to cUompete successfully against more conventional yet well-established air-transport service providers such as British Airways and Ryanair's main competitive advantage. 3. Suggestion of Ryanair's success about the elasticity of demand for the air-transport services offered to the markets served.

4. Attainment of Ryanair's profitability objectives (attributed to an experience (learning) curve effect).

5. According to performance objectives (financial and no financial) the trying of the firm to be efficient, effective and/or adaptive.

6. The factors can be perceived as Critical in terms of constituting a potential threat to the company's success (or achievement of objectives) particularly in an economic recession period such as the one we are going through.

7. The way Ryanair take advantage of new conditions in the broader market for air travel to sustain growth.

8. Ryanair's marketing mix in terms of how the mix elements serve the main strategy pursued. A focus on the company's mix including i) Product offered, ii) Price iii) Place (ticket distribution and network of airports), iv) Promotion v) People (employees) vi) Physical Evidence (use of aircrafts) and vii) Process (including the management of travelers before and after a flight to and from the airplane, respectively)

9. A brief research proposal about the ultimate aim of which is to collect data that will assist's company's management in terms of listening to and understanding better its customers prior to launching a new campaign.

10. Epilogue.

1.Introduction

Ryanair is an airline firm with low cost fares in a very competitive field. In order to promote a new project and to improve its service wants to make a marketing research to help its managers make some conclusions about customers and theirs needs.

2. Strategy allows Ryanair to compete successfully against more conventional yet well-established air-transport service providers such as British Airways and Ryanair's main competitive advantage.

Ryanair's strategy, that makes the firm to be competitive relatively to the other airline firms, is cost leadership strategy. "Cost leadership describes a way to establish the competitive advantage. In other words means the lowest cost of operation in the industry. The cost leadership is often driven by company efficiency, size, scale, scope and cumulative experience. Cost leader companies do compete on price and are very effective at such a form of competition, having a low cost structure and management."(Kottler 2006) Ryanair's main objective is to constitute itself as Europe's leading low fares scheduled passenger airline through continued improvements and expanded offerings of its low-fares service. Ryanair's main goal is to offer low fares that accomplish boosted passenger traffic while keeping up a continuous focus on cost-containment and operating efficiencies. (In its strategy involves low fares, customer service, frequent point-to-point flights on short haul routes, low operating costs, aircraft equipment costs, personnel productivity, customer service costs, airport access fees, taking advantage of the internet and commitment to safety and quality maintenance. (http://www.ryanair.com/doc/investor/Strategy.pdf)

Competitive advantage represents a company's ability to perform in one or more ways that competitor's cannot or will not match. According to Ryanair's strategy, Ryanair's' competitive advantage relatively to the other airline companies is the fact that Ryanair is based to its commitment which claims that the firm is going to have always the lowest fares of all companies. "Ryanair's' 'Double the Difference' Fare Guarantee ensures that on these rare occasions when a passenger finds a lower air fare on a competitors flight to the same route at the same date/time then that passenger will be repaid double the fare difference between the Ryanair and competitors ticket price as long as they book to travel on Ryanair." (http://www.ryanair.com/en/about/passenger-charter)

3. Suggestion of Ryanair's success about the elasticity of demand for the air-transport services offered to the markets served

"Price elasticity of demand is the responsiveness of the demand for a product to a change in its price, other things being equal."(Neil Harris 2001) According to the history of Ryanair's success it is obvious that if the firm reduces fares it will increase the number of its customers and its total revenues "If the value from an elasticity calculation is greater than 1 then demand is said to be elastic, i.e. a change in price will create a greater proportionate change in quantity demanded. Lowering the price will increase total revenue whilst increasing price will reduce it."(Neil Harris 2001)

4. Attainment of Ryanair's profitability objectives (attributed to an experience (learning) curve effect).

"The rule used for representing the learning curve effect states that the more times a task has been performed, the less time will be required on each subsequent iteration. This relationship was probably first quantified in 1936 at Wright-Patterson Air Force Base in the United States[1], where it was determined that every time total aircraft production doubled, the required labor time decreased by 10 to 15 percent. Subsequent empirical studies from other industries have yielded different values ranging from only a couple of percent up to 30 percent, but in most cases it is a constant percentage: It did not vary at different scales of operation. Learning curve theory states that as the quantity of items produced doubles, costs decrease at a predictable rate." (http://en.wikipedia.org/wiki/Experience_curve_effects)

6. The factors can be perceived as Critical in terms of constituting a potential threat to the company's success (or achievement of objectives) particularly in an economic recession period such as the one we are going through.

There are many factors that can be received as critical in terms of constituting a potential threat to the Ryanair's success. Firm's costs depended as well as on the market oil fuel so if in the year fuels are low they do not have to worry but if they are increased they have problem and they have to discuss seriously with their suppliers. The competitive airline firms with low cost fares such as Easy jet are also a factor that affects its success. Fields that Ryanair is not expanded as possible yet such as South Europe. Customer that are seeking for the lowest fares and they are cost effective. Traffic control's increased fares according to the number of flights. A recent problem that affected them was a physical disaster of the dust o a volcano that made firm to cancel many flights. So physical disasters affect them and bad weather also like snow or heavy rain.

7. The way Ryanair take advantage of new conditions in the broader market for air travel to sustain growth.

Ryanair is the firm with the lowest fares in Europe. The main focus of its marketing strategy is on cost reduction. Its managers continually try to reduce as much as possible operating costs such as fleet maintenance and equipment costs, administration costs, cabin crew salaries, personnel productivity (with promoting and improving the already high- productive work force), customer service costs and airport access and handling costs and reduction of fare cost as the general conditions allow it. Ryanair in order to keep its maintenance and equipment cost low try to have in its fleet new or young aircrafts so that they do not have a number of times in service or change or spare parts. Another element of tis try is the connection with its suppliers. The company has an aggressive tactic towards its suppliers to keep its costs down such as fuel supplier or ground handling companies.( http://www.ryanair.com/doc/investor/MaintenanceRepairs.pdf

http://www.ryanair.com/doc/investor/Strategy.pdf )

8. Ryanair's marketing mix in terms of how the mix elements serve the main strategy pursued. A focus on the company's mix including i) Product offered, ii) Price iii) Place (ticket distribution and network of airports), iv) Promotion v) People (employees) vi) Physical Evidence (use of aircrafts) and vii) Process (including the management of travelers before and after a flight to and from the airplane, respectively)

Service offered: Low cost fares with no free food or drink to charge customer. Ryanair has also other ways of keeping down the cost such as ancillary revenue. The firm has come to an agreement with Hertz car rental some hotel businesses and other facilities such as phone cards or bus tickets. Under this way they make a profit and they keep cot down.

Price: Its low cost fares and its commitment to change its fares if someone who flies with Ryanair find in another airline firm lower fares, keep the number of customers stable or even increasing. It is offer high seat density

Place: Ryanair has the internet advantage on its behalf. "During January 2000 Ryanair converted its host reservation system from BABS (British Airways Booking System)

to a new system called Flightspeed, which it operates under a 10 year hosting agreement with Accenture Open Skies. As part of implementation of the new reservation system and to make and pay for confirmed reservations in real time through Ryanair's Ryanair.com website through newspaper, radio and television advertising. As a result, internet bookings have grown rapidly, accounting for in excess of 96% of all reservations on a daily basis as of September 2004." (http://www.ryanair.com/doc/investor/Strategy.pdf) In this way they do not have to pay travel agents or agency commissions and this reduces the cost. Ryanair also has connection with secondary airports which gives it's the opportunity to pay less for every route and also to underline its punctuality, because secondary airports have fewer flights so they can fly and turn around there faster.

Promotion: Ryanair due to its booking via internet does not have to pay much in advertising. But has the advantage of having profits from advertising other firms in its space decorating in an appropriate way its aircrafts.

Employees:

"Ryanair endeavors to control its labor costs by continually improving the productivity of its already highly productive work force. Compensation for employees emphasizes productivity-based pay incentives, including commissions for on-board sales of products for flight attendants and payments based on the number of hours or sectors flown by pilots and cabin crew personnel within limits set by industry standards or regulations fixing maximum working hours, as well as participation in Ryanair's stock option programs."(http://www.ryanair.com/doc/investor/Strategy.pdf)

Physical evidence: They pay for maintenance as little as possible because they try to have new aircrafts. Their aircrafts are bought with big discounts because they try to buy them together in number and they buy them when no other airline firm wants them. In this way they keep their cost for maintenance and equipment down.

Process: "There is no check in. You simply show your passport and supply your reference number. You cannot select a preferred seat. It is first come, first served. This aids speed. There are no air bridges (the tunnel that connects to the side of the aircraft when to board it). You walk or are bused to the aircraft. Baggage is deposited directly onto the terminal - it's quick. However if your bag is broken don't expect high levels of customer service." (http://mgmt280.blogspot.com/2009/12/ryanair-marketing-mix.html)

9. A brief research proposal about the ultimate aim of which is to collect data that will assist's company's management in terms of listening to and understanding better its customers prior to launching a new campaign.

Ryanair is scheduling to promote a new advertising campaign to promote and improve its services and to boost their place in competition field. Due to this they have to make a research in order to make some interesting results about the customer's preferences and their thoughts of services and firm.

Firms objectives are related to their target group and their characteristics like age, social status (travel for fun or business traveling), the impact of the offered services, examine the need of new facilities if possible and to examine the need of new routes.

The target market it is essential to have its own experience of Ryanair and to have travel in the past with the firm.

We are going to use random sampling method because customers could be of any part of the world at any age.

We can find them via internet because the booking for the firm is functioned via internet. We can put the questioners when they are entering the firm's site. This kind of method is cheap and quickly. (Kottler and Keller 2006)

Questions.

1. What is your age

a. 15-25

b. 26-40

c. 40-50

d. above 50

2. Why are you traveling?

a. for fun

b. for business

3. Have traveled again with this firm?

Yes

No

4. Did you found any other firm with lower fares?

Yes

No

5. How satisfied are you with the way of booking

No satisfied 123456 very satisfied

6. Do you want any other facilities from the firm?

a. food

b. drink

c. Movie

d. other

10.Epilogue

Ryanair is a firm with low fares and its main objective is to keep costs down under many ways. The firm has stable customers due to its punctuality, safety and low fares.

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