This paper tackle the virgin blue company in Australia and the strategies it uses to be an outstanding brand not only in Australia but also in neighboring countries. Some of its competitive advantage has been discussed and also its current marketing strategies it’s using to reach where it is today. The summary of the paper has highlighted some of recommendations which can make Virgin Blue sustain it success in Australia
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Virgin blue competitive advantage
Competitive advantage is the traits or characteristic the company has which puts it on upper hand than other close competitors (Porter 1985)
Virgin blue velocity frequent flyer reward program
Members are allowed to purchase tickets which have got points which are accumulated. This allows them to save points which can book off peak flights. if points accumulate then they can be used to book a seat just before the deadline, this is an advantage that stands only in virgin blue, they are sustainable because even if the customer is booking the flight using points he must have travelled severally and purchased these flyers hence even before the flyers have accumulated enough points, the virgin blue is already having its profits.
This competitive advantage I believe is more sustainable and it makes the customer feel that they have also owned the company. Still this may be short lived because as it makes more routes the more the customer will accumulate many points which will be subject to the booking of more trips which might be only serviced by points instead of money.
Virgin blue extends domestic routes
With new jets virgin blue has progressively been able to enter new domestic routes by introducing new jets to service new points and routes which were unconcealed and also supporting those routes by their larger capacity routes in order to maintain those routes.
This may be sustainable by the virtual that the established routes are earning big profits the virgin blue will be able to work their way to the profit. Contrary this may not only be easy because this domestic flight may not be profitable because the customers may be having alternative travelling method domestically which they may prefer to the air travel. Due to transport charges customers may prefer using land transport.
On the other hand ,the issue of the established routes supporting the domestic routes may be short lived this is because the larger capacity jets may not be profitable enough to support the domestic routes and also may not be deployable in those domestic routes given their capacity.
Low air fares in virgin blue
Virgin blue since it started in Australia has been a discount airline whereby it has got low cost carrier. This made virgin blue to have many customers whom were able to afford for the fare, this consequently made virgin blue to be the second airline in Australia.
This is usually sustainable by the fact that the virgin blue is the second airline in Australia in terms of service provision. However were it not for this offer, virgin blue most likely could have been the leading service provider in Australia.
According to Slepen (2005) virgin has worked on the evolution of low cost carriers which it says it is a new world carriers completely different from other carriers in the sense that it is introduced as a network rather than carriers which operates from one point to another.
This can be sustainable because virgin blue does not operate from only one point to the next but a network which operates within where the company is located. This diverse operation brings trust to the customers who operate from different areas not only from the home market.
On the other hand, point to point carriers may appear effective if the company is operating within a local or domestic setting and since the virgin blue has adopted the domestic flights the low cost carrier network may not work well so still they have got to work with one point to the other carrier rather than the network.
Advertising in virgin blue
Virgin blue has been advertising using the internet and this has been very effective especially when it comes to social sites such as face book and twitter and also Wifi internet access for those who are travelling.
Still virgin blue has been advertising through news papers which have also proved to be very effective. For example in the newspapers they posted an advert ‘pass the parcel ‘which was also advertised in the internet. This was after 9 years of operations and they took it as the world biggest game for the 9th birthday.
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In participating in the game an individual was supposed to un-wrap the parcel and one has a chance of passing the parcel to friends who are still to do the same. This also allows the participants to win prizes and also increase their chances of winning if they pass on to friends (Global advertising archive 2011) Virgin blue current marketing strategies are both deliberate and emergent. This is shown in the following ways;
Marketing strategies as deliberate process
Virgin blue as we have seen from the above newspaper and internet advert is a deliberate process this is because the adverts are only posted in internet through the comment of the owner, hence virgin blue usually pays for those adverts with the aim of many people accessing them and also others participating in them to win prizes.
Virgin blue has deliberately used velocity reward system to attract its customers by making its customers to earn points which can be redeemed and pay for holiday packages also redeem seats with all those partners who are in velocity Airlines partners.
This strategy is for marketing purposes because they make customers enjoy many diversified services from many partners by joining the velocity. This strategy has attracted customers towards the services of virgin blue. Another deliberate marketing strategy is using low cost air which is targeted to winning trust among many customers. This was done to counter the competition of others companies which are offering the same services.
This to a great extent has enabled Virgin Blue to be popular and a great number of customers are enjoying its services due to that fact. The increased domestic routes in Australia are another marketing strategy which was deliberately started to increase the company’s effective and dominance in Australia through their excellent customer service.
Marketing strategies as emergent process
Despite the fact that virgin blue has been so vibrant, in its marketing strategies, not all marketing strategies it has devised has been successful, other marketing strategies which have emerged in the market has assisted virgin blue despite that it has not contributed towards those strategies.
As mentioned earlier social network has also contributed towards virgin blue because in those social networks one can only sign in an account and all those other marketing strategies thereon are usually dictated by those who are viewing your page. This means that when one reads a virgin blue article he or she may like the article and recommend it to other friends who are in those social networks; this has drastically popularized virgin blue.
Virgin Blue has used its strengths to market the services of the airline. The airline has introduced low cost fares and a reward system for the customers. Besides low cost fares, it has high quality service and has increased the frequency of the route.
The other strength is in the addition of domestic routes and introduction of international route. Virgin blue has been keen to avoid situations that would reveal weaknesses. The employees are well trained under a special program to prepare them for competitive service. One of the weaknesses is the cabins.
Virgin Blue has increased the frequency of routes and added other routes to its network which gives it the opportunity to be the proffered choice for domestic travel. Although the jets were ideal to make the domestic route sustainable, the locals are hesitant to spend.
There is reduced traveling due to the past disasters that has affected the economy of the potential client and the leisure destinations. Another the low cost are challenged by the constantly increasing prices of fuel which is a major threat. The fuel prices cause inflation of prices.
This is usually the close examination analysis or assessment of the competitors’ strength and weaknesses. It provides defensive strategies together with offensive strategies (Fleisher, Craig and Babette, 2003). This will reveal the opportunities that a company is exposed to and also the threats that may come along if the company will venture in that particular business (Gordon, 1989)
Virgin blue took into account the fare prices that the other competitors were offering and chose to give lower their rates. Implementing the low cost, they maintain the clients by giving quality services to retain them. The innovation of the rewards system is retaining in the competitive market.
Virgin Australia a competitor was forced to discard its pricing list and adjusted them to be able to get domestic passengers. This was due to the fact that Virgin Blue had introduced low prices and was getting a lot of domestic customers.
Other airlines introduced discounts for the domestic as well as international market. This completion led to low priced for domestic air travel. During the same rime the fuel prices were increasing which became a challenge to the businesses.
Internal analysis (4 P’S)
The 4 p’s marketing strategies usually covers the product being involved in the market, its price bonds the publicity and the place the business is usually carried out in. Virgin Blue ensures that the jets are in good shape and are maintained so as to remain as the best jets for domestic travel.
Some of the jets have leather seats and offer food among other benefits while traveling. All these services are given for low cost. The cost is friendly to the public. They bond with the public by introducing a reward system that encourages the public to associate with the organization. They further make it possible for the public to be able to access most parts of the country more often.
The airline company ensures that it meets the customer’s needs by giving services that they require. For instance, Virgin Blue increased the number of routes especially in destinations that people conduct business. They added the number of jets to accommodate travel needs of the customers. They also started flying into leisure destinations. Besides improving the domestic flights, it also extended airline service across the border making it possible for people to access other international destinations.
Porter five forces
The five porter forces by the analysis are an effective strategy. Virgin Blue has maintained the existing competition and conquered by causing more competition. By introducing the reward system that involves accumulation of points, it maintained its customers and won others (Bobette, 2011).
The strategy of maintaining the customers protects Virgin Blue from losing customers to a new competitor. The airline company realized that the customers compare prices and the quality services other competitors have. It made arrangements to lower the fares and gave the best service to the customer.
Virgin Blue recognizes the fact that other airlines are capable of becoming the best and therefore it makes arrangement for a strategy which will make it the convenient provider of services. Lastly, force of a replacement by the road transport is considered. Virgin Blue lower the price encourage people fly instead of going by road.
Appropriate changes in Virgin blue Marketing strategies
The marketing strategies so far virgin blue has been demonstrating are appropriate thanks to its continued making profits but still more can be done to make sure that its success in the Australian airline is guaranteed.
Virgin blue has been known by its incorporation of female names and words from Australia which brings a great deal of its airplane in Australia (Journal of marketing 2011). However this can also be supplemented by using Australian names which talks much about its culture and traditions which are deep rooted in aboriginal art that is indigenous Australian art. This will assist the virgin blue to appear to have adopted the culture of Australia and the issue of owning the company in Australia may be enhanced.
Virgin blue should offer more partnership with cricket in Australia which falls among the most popular sports in Australia this will make the virgin blue to be popular not only in the Australia but also worldwide. Virgin blue should speed up regional expansion strategies to make sure that it operates on other new regional routes apart from the one which has been in operation (Ian, 1989).
This will make Virgin Blue to be advantaged over other airlines because it will take all the terminals to the customers and its efficiency will of course have taken its customers confidence. Virgin Blue should expand its partnership to many non competing companies in Australia to promote their services while these companies may do the same, for example clothe companies’ beverage companies and many others.
The issue of social responsibility in Australian society should be embraced by virgin blue whereby it should deal with externalities, that is environmental damages which might arise due to their operations and also giving back to the society in form of foundation and many more.
The above research has essentially identified the strategies which virgin blue has used for it to reach those high levels of success (Stephen, 2005). It is evident that for any company to excel it must have a sustainable competitive advantage for it to survive the competition locally and globally.
Virgin blue has demonstrated to be a company on its own class; it has incorporated strategies which not many companies under the same scope would be able to improvise.
Secondly any company which is competing globally should at least have knowledge of other companies in the market and this can only be done through competitive analysis of other competing companies. It’s through this analysis that we learn strengths and weaknesses of the competitors.
It is also recommended that a company before entering into any competitive market it should first analyze its strengths weaknesses opportunities and threats which are in the environment, commonly known as SWOT analysis.
Bobette, K., 2011. Stronger SWOT Analysis and Marketing 4 p’s. Web.
Fleisher, C. S. and Babette, E., 2003. Strategic and Competitive Analysis: Methods and Approaches to Analyzing Business Competition. Upper Saddle River, NJ: Prentice Hall publishers.
Global adversity archive., 2011. Virgin blue: pass the parcel. Web.
Ian, G., 1989. Beat the Competition: How to Use Competitive Intelligence to Develop Winning Business Strategies. Oxford, UK: Basil Blackwell Publishers.
Journal of marketing., 2011. Marketing power. Web.
Porter, M. E., 1985. Competitive Advantage: Creating and Sustaining Superior Performance. 1 Edition. New York: The Free Press.
Stephen, B., 2005. Virgin blue maneuvers. Available at <https://www.theage.com.au/business/virgin-blue-manoeuvres-20051201-ge1ci1.html?page=2>