Qantas Marketing Case Study Flashcards
Strategic role of marketing
Qantas’s marketing plan and strategies allow them to create a profit because they:
Allow Qantas to achieve their goals through comprehensiveness
Identify and satisfy consumer needs
Give direction and help manage a changing environment
Encourage new product development
Create more distribution outlets
Interdependence with other key business functions
Operations
Finance
Human Resources
Operations:
Establishes physical limits such as flight scheduling
Finance:
Marketing generates funds and budgets are set out for marketing
Human resources:
Right staff need to be employed and trained to create a satisfying service
Marketing approaches
Qantas uses a marketing approach with various brands, such as Jetstar, and different classes of flight in order to service a variety of consumers, along with an extensive Frequent Flyer program to create repeat customers.
Market types
Qantas operate primarily in the consumer market, however Qantas Cargo transport freight in intermediate and industrial markets
Factors influencing customer choice Psychological Sociocultural Economic Government
Psychological:
Qantas take consumer motivation, perception and experience into consideration when selling their products, allowing different products to suit different consumers
Sociocultural:
Platinum membership allows for access to First Class lounges as reward for loyalty, suiting executive and affluent customers who pay premium prices for greater comfort, service and quality
Economic:
Jetstar is used to attract budget minded customers after a lower cost option
Government:
Qantas’s marketing department complies with Australian Consumer Law and state legislations
Consumer laws Deceptive and misleading advertising Price discrimination Implied conditions Warranties
Qantas follow Australian Consumer law and relevant state legislations
Qantas must engage in fair, open competition with other companies
Ethical influences Truth, accuracy and good taste Potential health damage Fair competition engagement Sugging
Qantas provide boxed meals which reduce wastage and use solar energy to reduce greenhouse emissions
Noise reduction programs and local sporting and community sponsorships address community desires and promote the Qantas brand
Qantas was fined $61 million in 2007 and $20 million in 2008 for colluding with other airlines to fix fuel prices
The firm has also been accused of not disclosing full flight costs and overly strict enforcement of contract terms on Jetstar
Situational analysis
SWOT analysis
Strengths:
Multi-brand strategy catering to different market segments
Market leadership position
69% market share with Qantas (43%) and Jetstar (16%)
Innovation track record
Wide geographic presence – Oneworld Alliance
Strong brand recognition
First mover advantage
Weaknesses:
Easily inimitable business model
Declining market share with increasing revenues
Gross margins and operating margins can be improved
High employee turnover
Extra cost of building new supply chain and logistics networks
Opportunities:
Increasing government regulations make it difficult for unorganised airlines
Opportunities in online services
Accelerated technological innovations
Trend of customers migrating to higher end products
Increasing customer base in lower segments
Threats:
Saturation in urban markets and stagnation in rural markets
Competitive pressures
Skilled HR shortages
Institutional distrust
Uncertain political environment
Situational analysis
Product life cycle
Introduction:
Jetstar Japan was introduced in 2012 using penetration pricing and heavy promotion, establishing brand awareness
Growth:
Jetstar Asia became profitable in 2009 with increasing sales and 38% capacity growth in 2012
New promotional campaigns and destinations added to sustain interest
Maturity:
Qantas domestic sales levelling off, high competition and consumer choice
Packaging redesign, marketing modifications, lounge and airline changes
Decline:
In FY12, Qantas international lost $450 million, cancelling orders for new planes and stopping loss making routes
Market research
Qantas use market research to guide marketing decisions
First step is identifying information like consumer needs, attitudes, preferences, intentions and characteristics
Establishing market objectives
Primary objective is to promote Qantas and Jetstar as separate, complementary brands
Identifying target markets
Qantas divide up the total market into smaller discrete groups to facilitate analysis and planning of customer needs, pricing, products and promotion
Predominantly use behavioural segmentation
Developing marketing strategies
Qantas develop plans around the 7Ps (see strategies)
Implementation, monitoring and controlling
Qantas has a systematic base for monitoring, controlling and adjusting its marketing activities through:
Developing financial revenue forecasts using past sales data and surveys to make estimations
Comparing actual and planned results, revealing the current business situation
Done using sales analysis + market share analysis + market profitability
Revising strategies and taking corrective action where necessary, such as reducing prices to stimulate demand, reducing flight frequencies and cancelling new plane orders
Market segmentation, product differentiation and positioning
Market segmentation
Mainly use behavioural segmentation to select target markets
Buyers are distinguished according to trip purpose (business and leisure/non-business)
Business is split into routine business, conference/seminars and emergency business
Leisure is split into holiday and visiting family/friends
Product differentiation
New airline establishment, each with its own target market appealing to customers from low cost local services to premium services across Asia
Positioning
Qantas positions itself against competitors, for example through Jetstar which was created to compete against Virgin Blue
Positioning is also used in relation to target market, for instance securing the corporate market through lounge upgrades, a frequent flyer scheme (Qantas Club) and services
