Benefits Of Virgin Economy Service example essay topic

THE AVIATION INDUSTRYThe aviation industry of any nation acts as a contributor to its economic growth, helps in globalisation and creating an international image. It is the best in terms of the fastest, safest and convenient mode of travel. Even though it is an expensive one, it is expanding its markets across the middle-class who are ready to spent money on leisure trips. Thus it is truly stated that aviation forms a vital core infrastructure area without which a country economy is handicapped. The civil aviation industry of world has expanded its wings by letting in private organisations. Privatisation in the domestic and the international circuit can help in foreseeing the future of the aviation industry at a mark up rise, and gaining international recognition.

It started eight years back with Open Sky Policy allowing charter flights to operate in domestic market. Today in the year 2000 we saw the code sharing agreement between Air India and Virgin Atlantic Airlines for the DEL- LON sector. During the last nine months there has been fare wars, value added services, alliances etc. Suddenly there seems some action in the Aviation Industry, where Virgin has acted as a lubricator. There are many other airlines, in bid of competition increasing their capacities or increase their flights for the same route. IntroductionIn the early 80s, when Virgin Atlantic was created, by Richard Branson was a go getting, sweater wearing entrepreneur and head of the successful Virgin Group, probably best known for Virgin Records.

By the early 1980s, Virgin Records was one of the top six record companies in the world. Then, in 1984, Richard got a phone call out of the blue suggesting a jumbo jet passenger service between London and New York. Branson like the idea, much to the horror of his fellow directors who thought him crazy. Undeterred, Richard announced to the world that Virgin Atlantic Airways would begin operating... within three months! An aircraft was found, staff were hired, licences granted and, thanks in no small part to Richard's infectious enthusiasm, on 22 June 1984 an aircraft packed with friends and the media set off for Newark, New York - and a phenomenon was born!Since then, Virgin Atlantic has become the second largest long-haul international airline operating services out of London's Heathrow and Gatwick Airports to 21 destinations all over the world - from Shanghai to the Caribbean and the US. In December 1999, Richard signed an agreement to sell a 49% stake of Virgin Atlantic to Singapore Airlines to form a unique global partnership - the deal valuing Virgin Atlantic at a minimum of lb1.225bn.

At the same time the combined sales of the different Virgin holding companies was around lb3bn. It turned out that 1999 was an eventful year for Richard and was topped off by being awarded a knighthood for his services to entrepreneurship. Marketing mixBeing in the service sector it is important for Virgin Atlantic to study its marketing mix as it works as an efficient tool, while building up marketing plans. It comprises of the seven P's which are as follows. PRODUCTThis P talks about the product as a whole, as what is consumed by the end consumer.

Virgin Atlantic has segmented its flight into three levels1. Upper Class.2. Premium Economy Class3. Economy classAll the three classes have state of art features, which are combined with the highest quality services.

Making the experience of a passenger a memorable one.1. Upper ClassVirgin Upper Class delivers a first class style with more amenities, space comfort and entertainment at a business class fare. This is marketed as a first class service at a business class fare and therefore competes with other carriers' business class product. It was launched by airline in 1984 and is now the holder of every major award in the travel industry. The services include:Onboard First Class reclining sleeper seat with between 80 inches seat pitch and adjustable leg rests. New seats have electronically controlled leg rests and adjustable headrests.

Virgin is the only airline to have a bar and a lounge on their flights. Choice of up to 21 video channels plus 10 Nintendo games, 5 classic PC games and 7 audio channels. Choice of four entrees with main meal including a vegetarian option. Complementary drinks including pre-take champagne.

Virgin is the only airline to offer Ice cream during the movie time onboard. In - flight Beauty therapist Virgin is the only airline to have an in-flight beauty therapist to give neck and scalp massage, zone therapy massage or manicure. Comfort kit containing various beauty products.2. Premium Economy ClassPremium economy is a flexible full economy fare allowing changes to flight details without penalty.

It offers all the benefits of Virgin economy service plus: Separate aircraft cabin Most comfortable economy seats in the world, with extended legroom, leg rest and adjustable headrest. The convenience of a separated dedicated check -in available and priority baggage handling for a first exit through the airport and priority duty free service. Generous air-miles from Virgin's Frequent flyer Programme 'Virgin Freeway. ' Pre -take off drinks including complementary champagne and bucks fizz throughout the flight.

Selection of fruit available throughout the flight. Ice cream during the movie. The benefits from the above features to premium economy, the passengers are offered superior service with the best economy seats in the world-"premium economy" is for economy travelers who expect more- perhaps business travelers whose company operates an economy travel policy but such passengers require some room to work.3. Economy classVirgin Atlantic has developed an enviable reputation offering economy class passengers, superb value for money and wide range for in-flight services and entertainment. Feature A personal seatback TV screen for hours of in - flight entertainment.

All economy passengers enjoy award winning in - flight entertainment including Movie Channel, Video Channel and Computer Games. Kids receive a special designed Complementary rucksack filled with goodies. Choice of 3 meals including vegetarian option. Complimentary drinks and comfort kit. Ice cream served during movie time. Space saving seats with maximum megrim and seat pitch upto 32 inches.

PRICEA perfect pricing strategy of an airline could add too much of it success and to its failure too. Virgin Atlantic has been cautious and has priced itself effectively, giving momentum to a price war. PLACEVirgin Atlantic's main channel is its GSA<STIC Travels. It is the number 1 agency in India and definitely a good decision of virgin Atlantic to employ STIC travel as its GSA. PROMOTIONSMost of the promotion schemes are the responsibility of the GSA, such as visiting the agents personally and informing them on various promotion for them as well as for the customers. Advertising is basically done through Newspapers, billboards, Brochures and internet.

The most prominent of all is the newspapers. But of all the major tools employed by the airline, the most effective is the awareness created by the travel agents. This is basically due to the fact that travelers in India rely on their travel agents for reliable information. PEOPLE Virgin Atlantic employs people who show the capability of being innovative and efficient. All employees at Virgin go for almost 6 months training, to make them efficient so as to deliver quality services. They have efficient performance appraisal systems that motivates their employees to work harder to achieve their goals as well as the goals of the organisation.

Lastly it is the customers who form the backbone of the organisation and thus providing them quality services and value for money is the main objective of the organization. PHYSICAL EVIDENCEThe product feature show the kind of ambience that is available on board. As one of the customer states "from the bright red ticket in hand to comfortable seats, to furnishing and to the food till the arrival everything is so attractive". It is these tangibles that stay on long even after the journey is over. These remind of the good time spent on virgin Atlantic and could be used as a marketing strategy to gain repetitive customers. POSITIONINGNow a days customization has become one of the biggest marketing tool, there is a need to understand the positioning of the product or service in the minds of the customers.

It is basically signifies the importance of perception that re interpreted by the consumer of the particular product to the service. Such perceptions influence the buying behavior and thus are the major concern to the organisations. Positioning is possible with the usage of tools such as marketing, promotions, value added services, word of mouth and etc. After carefully segmenting the market to which it wants to target Virgin Atlantic has been able too build positioning for itself in the mind of the consumers. When Virgin Atlantic came to India it flexed its product into the life style of its people. It has created an image of an airline made for the common man.

When Virgin Atlantic was launched in India, Richard Branson wore a traditional kurta, dhoti and a Punjabi turban. All this does seem a marketing gimmick but the idea to target Indian population. The crew that is recruited for the flight are recruited on the basis of knowledge of the foreign different languages. Virgin Atlantic has priced itself at a nominal rate, thus turning it out to be a non-expensive flight.

It has been able to build an image of value for money. Thus it can be said that Virgin Atlantic has positioned itself well in the market. Strategies of VirginIn order to excel in any market an organisation needs to know specific capabilities and undertake strategic investment in order to develop appropriate assets, infrastructure, network and the skills. To strive in these days of intensive competition one need to build a marketing infrastructure warfare strategy. These are strategies that help in giving a wining edge to a organisation in fierce competition. As companies experiment different ways to increase their sales, revenue they are turning more and more warfare strategies in general.

It is all a game of "taking business away from somebody else' " it is an art and not science, thus based on judgements. The marketing warfare of an organisation can bee followed by understanding the market, the competitors and its own positioning. Studying the markets and the role of its competitors has influence Virgin Atlantic to adopt an offending marketing warfare. OFFENSIVE MARKETING WARFARE - This warfare can be explained in brief using a quote, "where absolute superiority is not attainable, you must produce a relative one at a decisive point by making skillful use of what you have."- Karl Von ClarkewitzOffensive warfare is the game for the No.2 or the No.3 company in the field.

This company needs to be a strong one in order to sustain an offensive war against its leader. This warfare is guided by 3 principles1. The main consideration is the strength of its leader's position-focus on leaders, their product, sales, pricing, distribution etc.2. Find a weakness in leaders strength and attack at that point. Hit the weakness in leaders strength.3. Launch the attack on narrow as possible a front as possible.

VIRGIN'S OFFENSIVE MARKETING WARFAREOf the above three principles Virgin works best in the first 2. The last principle does not hold true in the virgin's strategies. Virgin Airways being the second largest longhaul airline in U.K. has always kept its focus on the leader of the aviation industry and its arch rival the British Airways. Virgin has and will always attack Virgin's position as it believes that it is not enough for Virgin Atlantic to always succeed, it is British Airways that must fail. British Airways logo "the worlds favourite airline" to attract markets was counter-attacked by Virgin saying "must be existing in another planet". This shows how it fiercely attacked back, the leader's promotional strategies.

The entrance of Virgin in the Indian subcontinent, has defiantly given a second setback to British Airways after its route in Shanghai and China in 1999. By providing value added services such as chauffeur driven cars, pubs, health club services better than its competitors has helped Virgin to grab a decent market share from that of British Airways. British Airways as mentioned before has been in the mind of customers for long and it is a tough war to actually win the percentage of the share. It has its prominent strengths which is difficult to crack through, but defiantly there might be some weak points that are just weak points and not an inherent part of there strength. It could possibly be a weak point that grows out of strength and which is inevitable. British Airways has always portrayed its image as an airline for cooperate people and has definitely gained a huge sales from it, and thus never thought of drifting from this image.

Virgin Atlantic from day one found the weakness in entering the market with the same image and thus it drifted from corporate image to a complete ethnic image and branding itself as an airline, which would cater the needs of the people. Airline AlliancesSingapore AirlinesVirgin Atlantic and Singapore Airlines announced a global partnership in December 1999, when Singapore Airlines took a minority (49%) stake in Virgin Atlantic. Virgin recently launched an economy class code share, which allows to sell three daily services between London and Singapore with vs. flight numbers. This development in the relationship follows the launch of the reciprocal frequent flyer programme, a joint lounge agreement. Continental AirlinesVirgin Atlantic's codeshare agreement with Continental Airlines allows to offer jointly high quality, high frequency services to New York. Malaysia AirlinesTeaming up with Malaysia Airlines to offer two daily services from Heathrow to Kuala Lumpur, with daily onward connections to Sydney.

Flights are operated by Malaysia Airlines Boeing 747-400 aircraft, and seats are available in First, Golden Club and Economy classes. bmi British MidlandThe codeshare arrangement with bmi British Midland allows European passengers greater access and simple connections onto the worldwide network of services operated from Heathrow. The codeshare allows to offer connections from Amsterdam, Brussels, Dublin, Milan and Madrid to most of the Heathrow destinations. NationwideVirgin is working in co-operation with Nationwide in South Africa. Nationwide offer a high frequency of services from Johannesburg to Cape Town, Durban, George and Livingstone, Victoria Falls.

They have worked to co-ordinate the schedules in order to offer the passengers the best possible connections in Johannesburg. Air IndiaVirgin Atlantic launched services between London Heathrow and Delhi in July 2000, in co-operation with Air India. These services, all of which are operated by Virgin Atlantic, increase the choice available to the travelling public on services between the UK and India. Virgin Atlantic Route NetworkUSAHeathrow / New York (Newark)/HeathrowHeathrow / New York (JFK)/HeathrowGatwick / Miami/Gatwick Heathrow / Los Angeles / HeathrowHeathrow/Boston / Heathrow Gatwick / Orlando/GatwickHeathrow / San Francisco / Heathrow Heathrow / Washington DC / Heathrow Gatwick / Las Vegas / Gatwick Manchester / Orlando/Manchester AfricaHeathrow / Johannesburg / Heathrow Heathrow / Cape Town / Heathrow Heathrow / Lagos/Heathrow AsiaHeathrow / Tokyo/Heathrow Heathrow / Hong Kong / Heathrow Heathrow / Shanghai/Heathrow Heathrow / Delhi/Heathrow CaribbeanGatwick / Barbados/Gatwick Gatwick / St Lucia / Gatwick Gatwick / Antigua/Gatwick CONCLUSIONVirgin Atlantic has proved its potential by being one of the most preferred airlines in the world. Its philosophy of innovation, quality and value for money has gained the loyalty of many passengers.

Its services, which are exclusive to this airline, enhance the experience of people on board. What more could you ask from an airline which has built an excellent. All this and more has resulted in a tough competition with its competitors, but Virgin Atlantic faces competition as a motivating factor, which would help them to grow in the long term. Virgin Atlantic has opened up a destination for Richard Branson to offer him a platform to invest in other activities. As it is known that Virgin Company has diversified itself into other products in other parts of world.

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