The Web 's Favorite Airline
1. COMPANY OVERVIEW
EasyJet was lunched in November 1995 with a fleet of two Boeing 737-300 aircraft flying from London to Glasgow and Scotland. Its mission was to offer low-cost airline service to the masses. This was successfully achieved by offering customers low fares with its no frill flights and adopting an efficiency-driven operational model; high brand awareness, maintaining a high level of customer satisfaction making it one of the leading low-cost airlines in Europe.
Extensive public relations and advertising campaign slogans by easyJet resulted in increasing demand for more flights resulting in the creation of new routes. The concept adopted by easyJet was the use of one type of aircraft
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Countries protected their National carriers by refusing other airlines landing slots in their countries. However, even with this deregulation in 1992, only 3-5% of passengers in Europe flew on low cost carriers, compared to 24% in the US. This was believed to be due to the direct competition with high speed rail services on some European routes.
Economical
Even with high entry costs, many new airlines came into the market. Though the cost of running an Airline in Europe was 40% higher than in the US, and as a result few low-cost carriers were as successful as easyJet. Even with such barriers to entry, it was predicted by analysts that the European low-cost market could grow by as much as 300% by 2004.
The value of the UK pound also made more viable to run operations from the UK. Avoid third person in order to get low price (price sensitive) Don 't understand this, and I can 't find it anywhere in the case
.Please explain. Anything else that can be added here?
Social
Due to the British and Germans being the most frequent travellers, most airlines set up their base in the United Kingdom. They also have more purchasing power because of the strength of their currency. I 'm confused about this currency stuff, as I don 't find it mentioned in the case study
Please explain. Anything else to add here?
Technology
Direct sales of flights were done over the internet.
To gain a competitive advantage, most companies tend to implement a brand strategy. What makes easyJet stand out amongst its competitors is their image of a low-budget airline and no-frills services; this brand strategy is simple but strong. EasyJets’ whole company is recognised by their unique orange logo, this color also forms part of the uniform worn by their staff, which in turn is a strong recognised tool by the consumers.
With the BCG Matric analysis, we can argue that Easy Jet enjoys a viable competitive position because of its actual market growth. However, its prices have been compared with those of rival firms. This has clarified that Easy Jet emphasizes on being a low-cost carrier with no surplus in-flight services. Writers such as Quelch & Deshpande (2004, p. 71) argue that the Boston Consulting Group growth/share matrix has offered an opportunity to establish the market share of Easy Jet and the company's growth rate. In the context of the company's low cost market, it is clear that the market is still are still increasing. In addition, with the current fleet volume of 80 aircrafts, Easy Jet can serve 160 routes across Europe. Industry experts have associated such massive penetration with the rise in numbers of passengers and a relative rise in market share. Consequently, it is clear that the company has become a star. Nevertheless, Easy Jet must expand its market share for it to transform into a source of income after the decline of the market's growth rate. With respect to the company's Boston Consulting Group growth/share matrix analysis, we can claim that the cash flow of Easy Jet from operating activities have declined as well as the annual finances. Nevertheless, the acquiring firm's cash flow statement is the main area of focus (Butler &
Many larger organizations have already achieved a mature stage in their organizational lifecycles and some are even in decline as their business models fail to keep pace with changes in an increasingly globalized marketplace. One larger organization that continues to grow using its original business model, though, is easyJet, which is already one of the largest low-fare air carriers in Europe and current signs indicate that the company will continue to grow its market in the future. To determine how easyJet has succeeded where others have failed, this paper examines the company's efforts in meeting the challenges with its initial launch, the company's early growth and the lessons learned from these experiences, as well as the acquisitions and mergers that have helped the company achieve its organizational goals. An examination of easyJet's organizational maturation status and how the company has differentiated its services is followed by a summary of the research and important findings in the conclusion.
The sector employs more than 3 million people. Prior to the 1990’s, the air transport industry in Europe had been traditionally highly regulated and dominated by national carriers and state owned airports. Since then a single market for aviation has been created. The single market has seen the removal of all commercial restrictions for airlines flying within Europe. These include restrictions on routes, number of flights and the setting of prices.
The strategic plan of Ryanair has been to establish itself as Europe’s leading low-fares airline.” Ryanair aims to offer low fares that generate increased passenger traffic while maintaining a continuous focus on cost-containment and operating efficiencies.” (www.ryanair.com)
The essay will firstly introduce the organisation easyJet. Secondly the essay will explain about how easyJet uses its operation strategies and its competitive priorities. Finally the essay will discuss the most important operation decision and explain it further in detail. easyJet is a well known low-cost airline which operates in several European countries and has been founded by serial entrepreneur Sir Stelios Haji-Ioannou in 1995. easyJet undertook intensive research of a United States owned low-cost airline ‘Southwest Airline’. Most of the concepts for easyJet were adopted from Southwest airline; however easyJet added its own touch which reduced operating costs even further. EasyJet was strategically located at London's Luton airport.
Hard to compete against the large airlines not only for customers but space at the airports for their airplanes.
The domestic US airline industry has been intensely competitive since it was deregulated in 1978. In a regulated environment, most of the cost increases were passed along to consumers under a fixed rate-of-return based pricing scheme. This allowed labor unions to acquire a lot of power and workers at the major incumbent carriers were overpaid. After deregulation, the incumbent carriers felt the most pain, and the floodgates had opened for newer more nimble carriers with lower cost structures to compete head-on with the established airlines. There were several bankruptcies followed by a wave of consolidation with the fittest carriers surviving and the rest being
The main exchange rates exposures are: British pounds, Deutsch Mark, Japanese Yen and Belgian Francs.
The airline industry has always been a fiercely competitive sector. Since the invention of low-cost carriers, also known as no-frills or
Since deregulation (1978) the average return on investment below cost of capital for the 5 largest carriers. Due to 9/11 the demand for air travel declined sharply.
JetBlue had made significant progress in establishing a strong brand by seeking to be identified as a safe, reliable, low-fare airline that was highly focused on customer service and by providing an enjoyable flying
1. Deregulation of the US airline industry in 1978 ushered in competition in the hitherto protected industry. Several low-cost, low-fare operators entered the competitive market after the deregulation.
We will see how Ryanair was successful as world’s one of the most favoured low-fare airline and how did it apply each of this mix by putting in the
Classic Airlines consists of 375 aircraft that travel to 240 cities more than 2300 times per day with a workforce of 32,000 personnel. Classic Airlines’ revenue was in excess of $8.7 billion last year bringing in a $10 million dollar profit and establishing the airline as the fifth largest air travel company in the world. Despite good sales and profits, Classic Airlines has been receiving harsh criticism from their customers resulting in a 10% decrease in profit shares, reduction in customer loyalty, 19% drop in rewards customers, 21% reduction in flights and the lowest morale seen in recent years. Classic Airlines remains optimistic about customer flight travel but must find