Answer To: ASSESSMENT 2 BRIEF Subject Code and Title MKT600 Marketing Assessment Assessment 2: Marketing Plan...
Anuja answered on Aug 10 2021
Executive Summary
During the course of this assignment, the detailed analysis and marketing plan for the next financial year has been discussed. Using the environmental analysis and strength and weakness analysis conducted in the previous essay, a marketing strategy has been suggested. The key points of the suggestions include targeting profitable international routes to increase market share. This will utilize the two primary opportunities of tapping into the growing international inbound travel and focusing on big data and analytics for better and accurate results. The key financial goal included increasing net sales and revenue, whose specifics have been discussed later in the segment. All the marketing and financial goals aim towards securing a leadership position for Qantas group in the international market as well as maintaining one’s position in the domestic market.
Table of Contents
SL. No.
Topic
Page No.
1.
Current Marketing Situation
3
2.
Threat and Opportunities Analysis
5
3
Objectives and Issues
7
4
Marketing Strategy
8
5
Action Program
10
6
Budget
11
7
Control Process
12
8
References
13
Current Marketing Situation
During the course of Assignment 1, we have provided a detailed description about the basic business of operations for Qantas Airlines and also discussed their current environmental situation. Based on this, a SWOT/TWOS analysis was drawn pointing out the key problem areas and opportunities. We will start this essay by analyzing the present situation of the airlines.
Market Description
The aviation market is pretty restricted in terms of offerings and entry. Based on geography, there are two types of markets- domestic and international and based on the services, there are two segments- low-cost and high-cost airlines. Apart from commercial, there is also a lot of business in air-freight and some airlines only operate air-freight routes and planes. The Australian Aviation market is valued at an estimated $43.54 billion till 2017, employing more than 88000 people (Australian Aviation Industry, 2018). Now, coming to the need analysis of customers, when it comes to international or long-distance travel there is practically no option other than taking a flight. For example, like a trip from Melbourne to Dublin or London, where the distance is too high to be covered by one mode of transport alone. The utility of low-cost comes in for domestic when people are comparing the different modes of transport and looking for the cheapest and most convenient.
Product Description
Qantas Airlines operates in all the options available in the aviation industry. Being founded in 1920, it has actually in these years grown to be the largest Australian airlines, by services and fleet size. It is going to complete 100 years in the next year, and the company indeed has a lot of achievements to boast of. Primarily, Qantas has three parts, Qantas airlines which is the main brand having domestic and international flights with frills. There is Jetstar, which is the low-cost branch of Qantas, running low-cost domestic and international airlines. And there is Qantas Freight, for air freight transportation and delivery. During the course of this essay, we will only discuss about the passenger services of the group. In the last financial year 18-19, Qantas has seen a net turnover of 55,273,000 passengers with gross revenue per kilometer being $126,814 million dollars (Qantas Data Book, 2019). There has been an impressive load factor of 83.2%, which is very high for a diverse company like Qantas. With a net revenue of $17,060 million, Qantas group has a gross profit of $1573 million, making profit margin per passenger approximately $29, which is greater than the industry average of $17.75 per person (The Wall Street Journal, 2018)
Major Competition
While discussing competition, we will divide our discussion into domestic and international. In the domestic field, Qantas has one major competitor which is Virgin Australian Airlines, the only other Australian airline. Virgin, for now only operates in the domestic segment. With a market share of 39% for Qantas and 21% for Jetstar, Qantas group is a leader in this segment. Being an evident duopoly, Qantas and Virgin have been in constant price war with each other, with Qantas trying to defend its majority market share and Virgin trying to cut a piece out (Wenliang, 2018).
Major international competitors include middle eastern airlines like Turkish Airlines, Qatar, Emirates and Etihad. South Asian airlines include Singapore Airlines and Malaysian Airlines. Other major competitors include British Airlines, Cathay Pacific, United Airlines and Delta Airlines. The international aviation industry in Australia is hugely fragmented with most market leaders not holding than 10% of the market share. Apart from Qantas and Jetstar (roughly 25%), Emirates has the majority share with 9.45% followed by Singapore Airlines with 7.54% (Routes Online, 2017). Around 30% of the market is strewn among other international players with negligent shares.
Marketing Channels
Let’s start with the distribution channels. The key distribution channels of Qantas are third party ticket sellers and tourist agents. The service also maintains an application and online platform for sale and purchase of tickets, for which it pays fees to credit card companies. Marketing and promotion is done through a variety of channels, both traditional and digital. Traditional channels mostly used are sponsorship for major sports events like cricket, basketball, rugby, football, Paralympics and Olympics (Qantas Official Website). The biggest digital program for Qantas is their loyalty program, which is also a big revenue earner. Digital promotions are used for offers, new route attractions and events.
Threats and Opportunities Analysis
In the previous assignment, we have discussed the threats and opportunities related to the services of the airlines and their brands, Jetstar and Qantas. Here, we will discuss some of the major threats and opportunities the company has, so that Qantas can accordingly exploit the opportunities, without clashing with the threats.
Opportunities-
· Growing travel from Asia to Australia- in the recent trend, this is the biggest opportunity which Qantas can capture and build on, considering it is the biggest Australian airlines currently. According to Tourism Research Australia, 2017, (pg. 2) international tourism is forecasted to grow from 33% in 2016-17 to 44% in 2026-27, which is a sharp 10% increase. Also, among the countries, China is predicted to emerge as the major source of tourism and inbound travel in general. The advantage of Inbound travel, be it tourism or education or work, is that it is not affected by economic instability inside the country, and trends almost always grow as population grows in these developing countries.
· Leveraging the power of digital and analytics-...