Introduction to Qantas Airlines

Marketing is the process to utilize organization’s workforce and resources to formulate and implement the most appropriate strategies so that it can approach to its targeted customers. Under this, the company proposes to maximize the sales of its products and services. It allows the firm to review and analyze the marketing resources and processes (Chernev, 2018). The major aim of this report is to conduct marketing analysis of chosen organization i.e. Qantas Airlines. Qantas Airline is a popular airline of Australian and it is one of the biggest players in the country. This report is focused on marketing practices which are used by the chosen organization. It evaluates both internal and external factors which can affect the growth and success of organization in Australian airline industry. External and internal environments are analyzed by using 5C’s analysis. Moreover, marketing intelligence and research are described which can be practiced to gather the data about different aspects of 5Cs framework. At the end, there is the recommendation about the marketing tactics and marketing mix strategies which can assist the company to attract more customers and increase its customer base.

Qantas Airlines is one of the biggest airline organizations which were established in the year 1920 in Australia. This is very popular for the standard air fares and for its international and local airlines. It is largest airline company in terms of international flights, fleet size and international destinations. After KLM and Avinaca, Qantas is the third oldest company in international airline sector. However, the company has started its operations in 1920, but it introduced its international flights in 1935. The organization has made various hard efforts to become a leading airline all over the world. Due to this, the company is able to increase its international presence and establish a significant brand image among targeted customers. The flights of this group fly to 20 local destinations and 21 foreign destinations in 14 nations across America, Africa, Europe, Asia and Oceania through its subsidiaries. Qantas group serves 31 international and 65 local destinations (Qantas Airlines, 2018). It is offering its services through its many subsidiaries such as Snap Fresh, Qantas Holidays, Qantas Freight, Q Catering, Ground Handling etc.

In its industry, the primary services of Qantas Airlines are to provide airline services which consist of travelling services to passengers who want to fly from one destination to other. It runs its operations under two brands such as Qantas and Jetstar and offers its services all over Australia and other nations also. The vision statement of the company is to run the best premium airline of the world i.e. Qantas and best low fare carrier of the world i.e. Jetstar. Moreover, it is communicating its brand message through the slogan i.e. “The Spirit of Australia”. Taking about its orientation, it can be said that Qantas has adopted market orientation under which company is offering its airline services and adopting strategies considering the demands and needs of customers. At Qantas, branding plays a significant role in its marketing strategy as it helps this company to reinforce its positioning in the market. For example, when the name of Qantas brand is mentioned then first thing which comes in people’s mind is the service quality and convenience (Qantas, 2018).

Marketing Practices of Qantas Airlines

5Cs analysis is a framework of marketing management which is practiced to evaluate the operative environments of a company. It assesses both internal and external factors of environment which impact company’s operations. Five areas of 5Cs analysis are discussed below:

• Qantas Airways is one of the largest airlines in Australia.
• It has strong position in both local and international markets.
• This company has been successful in cutting $2 billion of its yearly costs over last 3 years.
• One of the biggest strengths of Qantas is its Qantas Transformation program that aimed at enhancing the quality of airline service while reducing the costs at minimum.
• It is able to exercise effective brand building through sponsorship and advertisement (Hakala, 2015).  

In Australian airline industry, Qantas is operating its business and processes by effective utilization of its different resources. Intangible resources of this company are its talented and skilled staff which ensures its operations’ efficiency that it is engaged in. Moreover, there is the component of alliances which the companies enter into which enable for the sharing of lounges, frequent flier points and joint bookings (Bazargan, 2016). Qantas is the part off One World Alliance. The capabilities of its management specifically under the direction of Allan Joyce played a significant role in growth and success of Qantas. Additionally, tangible resources of Qantas are the fleet of aircrafts which are utilized by airline and its financial position. The hubs where Qantas operate are also a significant resource because the company has been able to bargain good deals which have reduced the costs which incurred to company.

• The company has generated lower profits from its international flights.
• There are various issues like price fixing and other incidents which have affected brand image of Qantas Airlines.
• The major weakness of this airline is the rumours about its purchase by Ethiad via buying certain stake. It has raised an issue for the company.

• One of the major opportunities is that it can attain a great level of development in global markets by adopting foreign direct investment.
• It can expand its business in various international destinations specifically in Asian market.
• It can come in strategic collaboration or tie with the international and popular airline companies (Qantas Airlines, 2018).

• Increase in the prices of fuel has huge impact on the Qantas operations and processes.
• It is confronting immense competition from other brands in airline sector like British Airways, Air France and American Airlines etc.
• Another threat for Qantas is from the low cost airlines and other modes of transportation like trains, cars and buses.

This company is targeting on its customers looking at their different segmentation characteristics like age, income, interest, usage rate and loyalty status. The company is offering different classes in its flights like first class, economic class etc. The major targeted audiences of this company are business travellers who are travelling inside or outside Australia for business purpose. Additionally, it targets the leisure travellers who travel to different countries for leisure purpose with their families. It is offering both premium and low cost airline services so it focuses on the passengers of all income levels.

The major collaborators of Qantas Airlines are its society, suppliers and manufacturing firms etc. Suppliers are the major collaborators at this company as they assist it to providing airline services by ensuring health and safety of passengers (Starkie, 2016). Boeing and Airbus are the major suppliers who supply it aircrafts and other related materials. Other suppliers are the firms and distributors which supply fuels for planes. Thus, it assists the organization to deliver quality airline services to final customers.

Qantas Airlines is facing intense competition from other brands. Virgin Airline is one of the biggest competitors of this firm. These are competing with each other and rivalry is in terms of price cuts. In addition to domestic markets, it is confronting competition in international markets (Roy Morgan, 2017). There are some international players such as British Airways, Air Asia, Southwest Airlines and Ryanair etc. 

5Cs Analysis: Evaluating Internal and External Factors

Under this, the government is facing issues due to the actions of government in many regions. For example, the services of this company are impacted by the political instability in Middle East region. Additionally, political conflicts in Bangkok have influenced Qantas operations in producing enough revenues from this area (Starkie, 2016).

The airline sector in Australia is very much affected by the fluctuations in the domestic and international economic systems. Due to current financial crisis, Qantas’s performance is impacted. This crisis has influenced the overall airline industry all over the world.

Social conditions and factors are also affecting the performance of Qantas to a great level. It is seen that people highly accept the low cost airline services than premium services. It has affected the premium class air services of Qantas.

In airline sector, technological factors affect in context that the whole process of ticket bookings is on the basis of online reservation system. By using advanced technologies, Qantas is able to enhance its services and providing more convenient services to passengers (Becker, Greve & Albers, 2009).

As mentioned above, 5Cs analysis is the technique which is used by the companies and researchers to evaluate its internal and external factors. There are many techniques that are used by Qantas to collect the information and data about different aspects of above framework (Malhotra & Peterson, 2014). Two most significant approaches of data collection are market intelligence and market research. Conducting market research is one of the most important processes which are adopted by Qantas Airline to gather the required information about its market audiences and segmented people. Additionally, marketing intelligence refers to the data that is related to the market of company. Under this process, the data is collected and evaluated for the objective of most suitable decision making. It assists the organization to formulate its organizational and operational strategy. By using these approaches, this airline is assessing it’s both external and internal forces which can impact its growth and success in international airline industry. 5Cs analysis supports this organization to examine its marketing environment because it can provide detailed information about environmental aspects. Using market research, this firm is able to gain the information about its customers, suppliers and competing brands. The company found that there are various competing brands like British Airways, Virgin Australia which can pose competition to this firm (Starkie, 2016).

For assessing the foreign markets, national reports are used as they provide the information about the macro-environmental forces. With the association of market analysis with resources of company, Qantas recognizes and selects beneficial opportunities to provide significant value to people. Via marketing research, Qantas Airline comes to know about the needs and expectations of its targeted customers. For this, it prepares different questionnaires and conducts surveys. It allows it to understand the expectations of the people towards airline services. This analysis revealed that customers generally prefer to buy the tickets of low-cost airline over premium flights. Social networking sites and internet are the major sources which assisted the company to collect the data about competing brands. This data helps the company to examine the strategies of rivals. In this research, suppliers and collaborators play a significant role because Qantas scan gather the data about competing brands from suppliers (Shaw, 2016). There are some other documents like investor reports, nations report and annual reports which can assist this airline to gather the data about airline market in both local and international markets.

Marketing Intelligence and Research

Choosing an appropriate target market is the most significant element in the formulation and implementation of marketing strategies of an organization. Qantas Airlines is targeting the people on the basis of different characteristics of segmentation. Segmenting the Qantas’ target market is very complex because different market segments have changing requirements, expectations and needs. This airline adopts behavioral segmentation for selecting the target market. It places its airline services as one which offers unending comfort and highest quality services to the passengers. Safety is one of the aspects which come into notice (Bendapudi & Leone, 2008). It is also showed as a luxurious and stylish airline which the travellers like to get accompanied with. The target market of Qantas Airline covers the business travellers who are travelling inside or outside Australia for business purpose. Moreover, it can be stated that this company is targeting leisure passengers. The customers of this airline do not hesitate to pay for premium and luxurious services offered by Qantas. It has implemented a very famous loyalty program for its customers that are called as Qantas Frequent Flier. This program drives more business travellers for this company. For Leisure passengers, in-flight systems, flight ticket booking system, seat allocation, meals, safety records and extra guidance services etc. are the major segmentation characteristics which are the major factors for target market selection (Gregson, Hampson, Junor, Fraser, Quinlan & Williamson, 2015).

Value proposition is one of the most significant statements that describe how an organization meets the demands and expectations of its potential clients by providing its good and services. The value proposition of Qantas lies core to the money value with consisted of benefits like loyalty program where the people are able to have free points. It creates its value proposition by emphasizing on the needs and expectations of passengers regarding airline services. It is offering different types of services by focusing on different level of customers like economy class, business class and first class. In the future, the organization should provide its services on affordable prices so every person can afford its services (Scott & Walker, 2016). It should provide discounts and offers for the frequent fliers. It has created its application through which people can check the flights and book their seats. It indicates that people can take its services very conveniently. This value proposition assists the organization to attract more customers.

Positioning statement has a vital role to grab the attention of customers towards products and services of a firm. It indicates that how the products and services of company can fulfill the needs of customers. Qantas Airlines needs to place its services as the highest quality airline services. It utilizes the positioning statement which indicates that this company is offering quality and stylish airline services on affordable prices. For instance, Qantas’ positioning statement is “Spirit of Australia” that attracts more customers. It can support the company to have loyalty of customers in its airline services (Hutchinson, Donnell, Gilmore & Reid, 2015).

Recommendations on Marketing Tactics and Mix Strategies

Considering above components, Qantas Airline can develop different marketing strategies which will help it to gain future growth. 

To place its airline services among targeted customers, Qantas Airlines should formulate marketing tactics by practicing 4Ps of marketing mix framework. These tactics are given below:

To stay competitive in the world airline industry, Qantas should pay huge importance to planning about its services. The company should craft its products and services to entice new customers and retain existing ones. Its services include passenger travelling accommodation in its flights. Generally, this airline provides premium travelling services. There are different types of seating arrangements such as first class, economy class, premium class and business class. The company should improve its services by including some complementary and additional services in flights. It should enhance its domestic flights by including some innovative services and amenities (Bahadir, Bharadwaj & Srivastava, 2015).

Currently, Qantas Airline generally utilizes cost plus method of service pricing. With premium pricing strategy, the company should provide the low cost airline services under its Jetstar brand name. It should use the penetration pricing strategy so that it can attract more customers and increase its customer base. It should provide discounts without showing them as discounts. It should try to maintain the customer price perception. It should loyalty programs which can provide excellent benefits to its customers (Huang & Sarigöllü, 2014).

Place is one of the most important marketing strategies of a company which help the organization to deliver products and services to customers. Qantas Airlines should use effective strategies for distribution of its airline services. Direct sales are driven form the counters of Qantas at airports. It should establish extensive distribution network to provide the services more conveniently. It should use its own retail outlets for selling the tickets. Internet is the most significant source that can be used by this company. The people should be able to book tickets through company’s websites and travel sites. Travel agents can be used by travellers to purchase the tickets. It should establish its kiosk centers so that people can buy the tickets easily (Liu, Li, Chen & Balachander, 2017).

Apart from above marketing tactics, promotion is the most significant marketing strategy that can assist this company to approach a larger population (Pavlou & Stewart, 2015). Currently, this company has less focus on advertising and promotion so it should emphasize on promotional advertising. For effective advertisement, the company should use different sources like internet, radio, TV, brochures, magazines, billboards etc. These sources can be utilized for the objective of promotion and branding. It should use direct marketing to send and deliver its brand message to final customers. During the off seasons, the company should use sales promotion technique to increase the passenger arrival (Jones, Reynolds, Arnold, Gabler, Gillison & Landers, 2015). Additionally, the company can use personal selling and other techniques so that it can approach its targeted customers.

Conclusion

Thus, it is hereby concluded that Qantas Airlines is using effective processes and marketing strategies so that it can attain its goals and objectives. This airline is taking various initiatives to meet the wants of customers. Marketing and selling strategies are the major reason behind the growth and development of this airline. From this report, it can be found that company is failed to increase its customer base due to higher prices. Thus, the organization should revise its marketing strategies and tactics which can support them to get a top position in the airline industry. 

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