Air Asia Aims to be the Largest, Low Cost Airline Essay

Customer satisfaction and service quality are the two important components that direct anyone’s attention in every concept related to marketing, services, etc. (Spreng and Mackoy, 2006). In today’s competitive era, the success lies in

In 2001, AirAsia was founded by Tony Fernandes. After six years, Fernandes realized the company should create a airline separated from AirAsia to focus on the low cost long-haul market which he called AirAsia X. Azran Osman-Rani was appointed to the become the CEO of the newly established company. The company had an initial success by being the first mover. However, there were some problems that they had to face along the way as they were in a completely new market using an untried business model. One of the main challenges for the company is the protectionist measures taken by the Malaysian government to protect the national airline, Malaysia Airlines (MAS). The other major problem is the limitations on the general

This case analyses Prof. McPherson’s service experience with respect to two Airline carriers, which was not expected in this age of Network and Information Technology and also the service level expectations from the customers. First we analyze the setting/situation, issues Prof. McPherson experienced and his assumptions; and then try to address them. The bottom line: addressing such situations would improve efficiency, customer loyalty, brand name and increased profits

To be able to adjust with stiff competition that keep increasing in the airlines market, airlines industries tend to come up with different approaches and strategies to be more competitive. Air Asia, like any other airlines adopt strategic approach to marketing and expand their market reach and give better and satisfying service delivery to their target market. Being an industry that considers differentiation strategy, Air Asia continue to focus on their low cost approach, frequently flights approach, guest convenience, ticketless services, easy payment channels, internet booking, reservations and sales offices, and authorized travel

However, meals, pre-book baggage, seat assignment and extra services are not included in ticket of Air Asia, it is reasonable , at all. Furthermore, Air Asia offers a simple “no frills” service at fares that are on average notably lower than those offered by traditional full-service airlines. Modeled on winning low fare airlines such as the U.S.-based Southwest Airlines and Dublin-based Ryan air, Air Asia was established to produce a new aviation product in Malaysia, one that would develop air travel, and improve the local aviation market by providing very low fares so more people can fly. The company banks on the cost of running ‘bricks and mortar’ outlets and could reach national markets without having to extend a physical distribution network. Most essential was the company could save on customer service costs by enabling customers to serve themselves. Furthermore, Air Asia effectively adopted focus strategies by having developed a very well-organized and fully computerized system for its customers to book the air tickets through its website. Air Asia also have a high frequency of flights to most short haul and regional destinations in order to serve a wider market segment as well as to reduce the turnaround time in the ground between flights, which is 25 minutes compared to an hour for full service airlines. (Air Asia 2011) To

Air Asia is one of main low cost airlines in the world. It’s based in Kuala Lampur Malaysia. It’s the biggest airline based in Malaysia and it has more affiliation in other airlines around the than another airline. They operate domestic and international services all around the world in more than 22 countries. Air Asia has been nominate as the cheapest to fly airlines in the world by New York Times Magazine, which as lowest as it’ll get.0.023 US dollars to be exact and it has been named as the “pioneer” of low cost airline in all over Asia. Plus they have sponsor Queens Park Rangers football team Barclay Premier League in the UK.

AirAsia is a strong company with several unique strengths that offer itself could not be defeated by others competitor companies.

The main purpose of this study consists in an investigation on the service quality as the cause and the loyalty as the effect of customer satisfaction in airline industry.

Air Asia has managed to achieve lower prices to attain high passenger loads, market share and profitability by eliminating provision of costly inflight services, flying a standard fleet, selling tickets to passengers directly and minimizing labour and overhead costs. Its successful negotiations for its low aircraft rates, low long-term maintenance contracts rates and low airport fees, enable Air Asia to provide the lowest fares. As a result, Air Asia was able to reduce its overhead and investments in equipment.

Identification of the key aspects of the business literature (e.g. service quality) to be underpins the study. This review should briefly cover the main ideas and business practice that will be considered. It should locate a sample of the some of the main sources and identify key critical issues that might arise. – Word Guide 750 – 1000.

There are several business organizations operating around the world, competition is at its peak, products and services offered are so closely similar that identifying the difference between them is difficult, but there is only one way differentiation is made in today’s market, in the larger prospective, and that differentiation is the difference in quality offered. Ali et al., (2010) points, out that the properties of a service or product that the buyer or user purchases and the value given to it by them is the quality of that product or service. Koch (2003) suggests that quality is a process of developing a product or service, building relationship through assessment, anticipation and the fulfillment of the stakeholders implied needs. It is here where the real market is, real competition, customers, profits, market share and success lies. Organizations that deliver quality are always desired by their customers. In order to survive in this

Air Asia leading airline was established with the dream of making flying possible for everyone. Since 2001, Air Asia has swiftly broken travel norms around the globe and has risen to become the world’s best. With a route network that spans through to over 20 countries, Air Asia continues to pave the way for low-cost aviation through our innovative solutions, efficient processes and a passionate approach to business. Together with our associate companies, Air Asia X, Thai Air Asia, Indonesia Air Asia, Philippines Air Asia and Japan Air Asia.

Sureshchandra, Rajendran and Anantharaman (2002) identified five critical aspects of service quality from the customers point of view namely core service/service product, human element of service delivery, systematisation of service delivery, tangibles of service and lastly social responsibility in order to conceptualise service quality. Table 1 will further provide an explanation to the five critical aspects of service quality as outlined by Sureshchandra et al (2002).

In the year 2001, Dato’Sri Tony Fernandes and Dota Kamarudin Meranun had bought over Air asia for RM 1.00 with a RM 40 million debt. Airasia has been expanding rapidly ever since and become the leader of low cost airline in Asia and the pioneer of low cost. Airasia continues to expand worldwide through the innovation, efficient, passionate and right strategy.

Any good businessman understands one thing-if he understands nothing else-that customer service is vitally important to the continued survival of a company. In fact, ask any small business owner the secret of his success and the answer will usually have something to do with customer service. You can have the greatest product in the world, but if you don't work on customer service-making the customer's experience as good as it can be-then you are not going to sell very much. If a recent survey from the University of Michigan is correct, this seems to be a lesson lost on the majority of airline executives these days. In fact, with