Discuss About The Journal Hospitality And Tourism Management?
Marketing play an important role for the contemporary business organizations in surviving in the current competitive business scenario. In addition, having effective marketing strategies also helps in cutting off the intensity of the competition and helps to stay ahead over the competitors (Gronroos and Gummerus 2014). However, prior to the implementation of the marketing strategies, it is important to determine the current market position along with the current market segments. In accordance to that, marketing strategies should be implemented. There are various models and concepts related to the marketing can be used in order to determine the market needs and requirement and to implement effective strategies.
Emirates airlines is one of the leading airliners in the world based in Dubai, Abu Dhabi. Emirates are the largest airliner in the entire Middle Eastern region in terms of the passenger traffic and flow of the airlines. In terms of the passenger traffic, Emirates are currently standing at rank four globally (Emirates global 2018). Currently, they are having their presence in more than 80 countries and fly in all the major cities around the world. However, in the recent time, they are facing huge competition in the market due to the presence of various global brands and established players. In addition, other airliners from the Middle-eastern regions such as Ethihad airways and Qatar Airways are posing serious threat for Emirates airlines.
Therefore, it is important for Emirates airlines to effectively determine the current market position in regard to the competition. In accordance to that, they should identify the marketing objectives along with the target market. This report will discuss about the current position of Emirates in the market. In addition, this report will also discuss about the ideal marketing mix of Emirates, which will help them in having better position in the market.
Current market position of Emirates
The first step of determining the marketing strategies of Emirates is to identify the current market position of them. In this case, BCG matrix will be used in order to identify the exact area where Emirates is currently standing in front of their competitors (Rudnicki and Vagner 2014).
The above diagram is showing that Emirates airline is belonging in stars where none of their competitors are present. This denotes that the current market share as well as the current market growth rate is favorable for them. Thus, Emirates airline should design their marketing strategies in such way that it will help them to attract new customers as well as retaining the existing ones. On the other hand, it is also identified from the above diagram that Lufthansa can be considered as one of the key competitors. This is due to the reason that Lufthansa is currently standing in the Cash cow element, which denotes that they are the market leader but not having the growth rate as Emirates airline. Moreover, Qatar airways are having less market share than Emirates but they are also having growth rate. Thus, it can be concluded that currently the growth rate of Emirates is favorable but they not in the top position in terms of market share. The marketing strategies should be implemented in order to retain the existing customers.
Brand positioning map
Brand positioning map will be used in order to identify the current positioning of the brand of Emirates and how they are being perceived in the market against their competitors.
The above brand positioning map shows that Emirates Airline is being positioned as high cost and high quality airliner. On the other hand, it is also being seen that Ethihad is having higher price structure compared to Emirates with having higher service quality. Moreover, Qatar airways are having similar service quality with Emirates but they are having lower price point compared to the other two. Air Asia and Ryan air is having much lower price points compared to others but they cannot pose much challenges to the Emirates due to the reason that Emirates are being positioned as long haul and quality airline over the budget carriers and show haul flights of Ryan air and Air Asia (David 2013). Thus, from the above map, it can be concluded that the key competitors for Emirates are the Qatar airways and Ethihad airways. Moreover, due to the fact that all these players are being based in the Middle Eastern regions, the competition is much higher.
Identification of the marketing objectives
The above sections have discussed about the current market position of Emirate airline over their competitors. Thus, the ideal marketing objectives of them in accordance to their current market position will be discussed in the following sections (Lee, Kozlenkova and Palmatier 2015). The objectives will be discussed for 3 years period.
- The first marketing objective should be the overtaking Lufthansa in terms of the market share. This is due to the reason that the core objective for any marketing strategy is to increase the customer traffic. Thus, according to the above analysis, Lufthansa is way ahead of them in terms of the current market share. Hence, the marketing objective for the next three years should be overtaking them.
- The next objective will be increase the brand position in the mind of the customers in terms of the service quality. This is due to the reason that, in the above analysis it is seen that Emirates is trailing behind Ethihad in terms of service quality (Hussain, Al Nasser and Hussain 2015). Thus, the marketing strategies should be designed and implemented in such a way that the diverse service provided by Emirates should get properly communicated to the target customers.
- The last marketing objective of them should be entering in the untapped regions. There are still various potential regions where Emirates airline is not having their presence. Thus, in the next three years, they should initiate their marketing strategies in order to tap the new markets.
Identification of the target segments
Emirates being one of the largest airliners in the world are having diverse and vast customer segments. This report will identify three key customer segments for them and will discuss the strategies that can be initiated in order to enhance the loyalty of the respective customer segments (Cross, Belich and Rudelius 2015). Segmentation process will be done in terms of only usage and behavioral characteristics of the customers. This is due to the fact that gender segmentation and age segmentation are not applicable in the case of Emirates.
Corporate or professional passengers comprise of the major portion of the revenue of Emirates. This is due to the reason that professional people tends to travel more for their job or business. These passengers travel single in majority of the cases and are frequent flyers. Thus, they should have the loyalty with the airliner in order to retain the frequent flyers. One of the key strategies that can be initiated by the Emirates airline in enhancing the loyalty of this segment is to promote them frequent flyers list (Ashton 2015). This will enable the corporate passengers to have huge array of services and discounts along with other offers year around. Passengers in the frequent flyers list will be able to have certain fixed discount every time they book tickets with Emirates. Therefore, if the corporate flyers are being given fixed discounts over the standard charge then it is likely that they will prefer Emirates over their competitors (Meyer-Waarden 2013). Another strategy that can also be initiated is the pick and drop facility to and from the airport as a complimentary service. Majority of the corporate travelers travels on very tight schedule. Thus, if Emirates provide them pick and drop facilities, then it will be easier for the travelers to reach to their destination in minimal time and comfortably. It will motivate the travelers to book their flight with Emirates in further time also.
Apart from the corporate flyers, there are seasonal tourists who mainly travel in groups with friends and families for only tour purpose. Among them there are number of frequent flyers also who travels in groups for at least once in year. The key advantage that is being gained by Emirates from this segment is the bulk bookings. One of the key strategies that can be initiated by Emirates in enhancing the loyalty of this segment is to provide them guidance of their tour destinations (Terblanche 2015). In majority of the cases, tourists are having less or no idea about their destination as they are visiting for the first time. Thus, Emirates can provide the guidance service to this customer segment about how and where they should visit. It will make the tourist feel more comfortable prior to the visiting to their destination.
Another strategy that can be initiated by Emirates in enhancing the loyalty of the seasonal tourists is the seasonal bonus and offers. Festivals such as Christmas witnesses huge traffic in tourism. Hence, providence of added bonuses and discounts will further attract the existing customers to aging book their flights with Emirates. During the seasonal festivals, special vouchers, goodies and wishes can be given to the travelers as part of the customer relationship management. This will ensure the high brand recall among the existing customers.
First time flyers
Out of the all the customer traffic of Emirates airline, there is huge portion of first time flyers also. These first time flyers are having both corporate and group tourist also. However, the strategies in relation to the first time flyers should be more customized and different from the existing strategies. The key reason for this is that first time flyers are not having any idea about the international flights and the norms and regulations to be followed in the airports. There is always a sense of insecurity works with this segment. Thus, Emirates should have support facilities for the first time flyers along with having some sort for added engagement activities for the single flyers also (Chen and Hu 2013). This will made the travelers feel easy and comfortable. It will help in creating positive image among the first time flyers and the first impression will be long lasting and will help in enhanced loyalty of them.
Recommended marketing mix
The current market position as well as the target segments for the next three years is being identified in the previous sections. Thus, in accordance to that, ideal elements of marketing mix will be discussed, which will further help to solidify the brand in the global market (Mintz and Currim 2013).
In the case of the Emirates airline, the product is their airline service. It is recommended that they should have different types of aircraft to suit the different needs of the customers. For instance, they can use the narrow body aircraft for the shorter distance, which will also cost low for the customers (Kuo and Jou 2014). On the other hand, wide body aircraft should be used for the long distance travel. This is due to the reason that in the recent time, concept of city breaks are becoming popular and having shorter flights with narrow body aircraft will suit the need and affordability of the customers. Moreover, providing wide body aircraft in the long distance will offer comfortable flight for the customers. Thus, service variations should be there in order to meet the varied customer requirements. It is also being suggested that Emirates should have added facilities in their aircraft such as internet facilities, personal entertainment facilities and different cuisines (Wu and Cheng 2013). This will further create satisfaction among the customers and will help them to create distinctive image among the market.
In order to stay ahead in the competition, cost leadership should be promoted by Emirates. Though the target customer segments of them are mainly from the top and middle of the pyramid but having cost leadership will help them in increasing their profitability ratio (Kaliappen and Hilman 2013). It is evaluated in the earlier sections that price of Qatar airways are less compared to Emirates even delivering same service quality (Chung and Petrick 2013). Thus, achieving the cost leadership will help Emirates to beat Qatar in terms of the pricing also. The more will be the cost leadership, the more capital will be with them to invest in providing added facilities to the customers. Hence, the brand value will get enhanced in terms of service quality.
The more locations will be covered by Emirates, the more exposure they will get in the market in terms of their brand value (Buil, De Chernatony and Martinez 2013). Thus, it is recommended that Emirates should enter the markets where they are currently not operating. This will increase their passenger traffic as well as their brand value. In addition, facilities such as online ticketing system and web check-in will help in creating positive brand image among the passengers (Skeen et al. 2015). Thus, it is recommended that Emirates should use their place element in enhancing the convenience of the passengers in order to create positive image in the global market.
Promotion is the most important element in the marketing mix, which will be the most effective in enhancing the brand value of Emirates (Severi and Ling 2013). This is due to the reason that, promotion activities will determine whether the service provided by Emirates is being effectively communicated to the customers or not. It is recommended that Emirates should involve Omni channel marketing strategies in order to reach out to maximum number of customers around the world. Having online marketing mediums will help in reaching to the customers from the regions where Emirates are not having market presence (Balakrishnan, Dahnil and Yi 2014). On the other hand, offline promotional activities such as in flight activities and airport promotions will help in drawing more passengers and to communicate the brand value to the potential customers.
Ansoff matrix is having four key components including market development, market penetration, product development and diversification. In the case of Emirates, it is recommended that they should opt for marketing penetration and market development in to retain the existing customer base along with tapping the new markets. These two strategies will help them in having dual benefits (Malysheva et al. 2016). Market development strategy will help in increasing the market share globally and market penetration strategy will help to retain the existing customers and market.
Thus from the above discussion, it can be concluded that the key challenge facing by Emirates airline in the recent time is the increase in the competition in the global market. BCG matrix and brand positioning map is being used in order to determine the current market position of Emirates as against its competitors. In accordance to that, this report discussed about the target segments that should be considered in order to increase the market share in the next three years. Various strategies are being discussed in order to increase the loyalty of the identified target segments. In addition, an ideal marketing mix is being discussed in this report, which will help Emirates to enhance their market share as well as brand value.
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