Target Market Of West Jet Airlines Ltd example essay topic

The company is constantly attempts to go forward due to the belief that if the company is not going forward, it automatically going backwards (Bergman, 2000). West Jet Airlines Ltd, as a result of such policy has various agreements with Boeing and GEC AS (General Electric Capital Aviation Services) to provide West Jet Airlines Ltd with 36 airlines over the next eight years, which would be both incremental and replacement aircraft depending on the current state of the economy in Canada. The West Jet Airlines success, in my opinion, would also be contributed to the economic slowdown of Canada should it occur for the fact that people are more cost-conscious in slower times and look more aggressively for lower airfares. West Jet Airlines Ltd has already lowered airfares in the markets in Canada on average by 50% on an equivalent ticket-to-ticket basis. Which means that seven day advanced tickets price is at present 50% less than it was five years ago, while the walk up fares are approximately the same.

The company also pays extremely important role to the marketing of its services to the citizen of Canada and the USA who recently started to use West Jet Airlines Ltd on their business travel around Canada. West Jet Airlines Ltd markets its services through a combination of the direct advertising and the Internet. As a matter of fact, 32% of the company business is done over the internet and the corporate web site. The company also does direct marketing uses extensively its local call center that accounts for about 70% of the corporate business. The company also uses the free-of-charge marketing, a. k. a. word-of-mouth referral since the company claims to have tremendous support from its customer base, yet it does not make any estimates regarding to what portion of business the word-of-mouth referral accounts for. The company can boast a rather large average load factor of about 72% in 2002 that is already 2% higher than the load ratio of the year 2001.

The target market of West Jet Airlines Ltd: The company's target market is the visiting friends of Canadian nationals, relatives, as well as cost-conscious business people of both Canada and the USA. At the company inception in 1996 when the flights were rather infrequent, the target market for such flights remained exclusively friends and relatives who traveled across Canada, yet with the corporate expansion and the increased flight frequency more and more business people started to use the services of West Jet Airlines Ltd. For instance in 1996, the company had only 2 flights / day from Calgary to Vancouver and in 2001 there are 10 flights a day making the flexible schedule teamed up with low rates rather appealing to the business clients. The company in 2001 started to enter the cargo shipment business, which now is only a marginal 1% of the total revenue stream to the company. Another successful strategy that West Jet Airlines Ltd has adopted is the symbiotic relations with the Ramada Inn thus making a famous West Jet Holiday package. A client that wants to visit his friends in another Canadian city to play golf does not have to worry about accommodation or meals but pay a single price: West Jet takes the customer there and back, while Ramada Inn takes care of the accommodation.

Also Ramada Inn has lately started individually promoting such packages in various media (trade journals and radio), thus reducing direct marketing expenses for West Jet Airlines. The company attempts to position itself as the most reliable company in the airline industry on the North American continent. The West Jet Airlines Ltd on time performance is currently the best in North America that runs at 86% on a month-to-date basis. West Jet runs regularly at 86% on time performance, whereas Delta, which is the best airline in the United States Of America, ran at 79% in the second quarter of 2002.

The West Jet Airlines Ltd dispatch reliability runs at 99.1%, which is extremely good compared to the US number of only 97%. The company prides itself that if the customer is delayed by only two hours, he or she will receive a full credit for the ticket they had purchased. West Jet Airlines Ltd is to my mind a very customer conscious company that creates a lot of customer loyalty that once again contributes to its constant-growing profitability. As an example according to the Airline Today magazine May, 2002, Air Canada received one complaint for roughly every 25,000 passengers, Canada 3000 received one complaint for every 30,000 passengers, and West Jet Airlines received only one complaint per 1 million passengers, which is quite incredible. Speaking about the company threats one should not forget about the oil price fluctuations that immediately are reflected on the company's profitability, yet West Jet Airlines Ltd seems to have thought over is as well.

West Jet Airlines Ltd in order to efficiently operate the airline in the current fuel rate environment had hedged about 50% of its fuel in a fixed price, fixed volume contracts in Canadian dollars at an equivalent price of $18.51/barrel, which expires in June 2003. That contract represents 50% of the corporate fuel needs for the year 2002 and it locks in the prices, thus creating some stability with the possibility of the fuel price fluctuations. Impact of success-on employees / on local community The company has remained environmentally-friendly since the day of its inception of 1996. In the year 2000, the company has made another important decision to acquire Boeing newly designed 737-700 planes that have a longer utilization life, are almost 25% more fuel efficient than the planes the West Jet had previously had and causes less environmental pollution. Although I would personally argue the fact that the company had acquired them only for the environmental safety reasons (rather than cost reduction), it should be still given credit for the attempt to keep the environment safe. The West Jet Airlines attempts to maintain its culture and structure as entrepreneurial as it was in the very beginning when four Canadians decided to create their own airline company that turned out to be the second most profitable airline company in Canada (after South Western Airlines) The organization has a lean structure with only 4 levels of management, that encourages its employees to feel themselves important members of the team who can always provide the best solutions to the company problems.

Communication is highly valued and encouraged from all levels of the organization, in keeping with the West Jet Airlines Ltd. commitment to being sincere and open with the company workers and the community it operates in. People work with their teams to make decisions and solve problems and are encouraged to be innovative in finding ways to solve problems because of their remuneration being directly linked to their productivity.