Marketing Analysis of Jetstar and Virgin Blue Airlines Essay

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Executive Summary

This research report provides an analysis of two popular airlines in Australia; Jetstar and Virgin Blue, both whom are competing in the airline business. Jetstar and Virgin Blue can both compete and be highly profitable within the business, leisure and family market but however, it will ultimately be the service companies, and their associated marketing strategies and techniques which, will establish the difference between the market ‘leader’ and the market ‘loser’. This analysis will detail potential solutions to a number of major strategic issues confronting the companies to maintain its position and protect its profitability in its core domestic market.

There is intense competition between the airline brands and
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7). Furthermore, this view enables Virgin Blue to be differentiated from the competitors much easier, having a distinctive outlook different from other airline companies.
1.2 Service recovery and customer handling
Service recovery and handling customer complaints is very important in the airline industry and leads to customer satisfaction and loyalty. In the past, Jetstar in particular have had to put their service recovery plans into action. For example, on the 16th of April 2007, a Jetstar flight was cancelled with 300 Australian customers being stranded in the airport for 48 hours. Although the article doesn’t specify how Jetstar used service recovery whilst the customer were stranded, it does state that Jetstar personally called each passenger to apologise, as well as telling them they would receive another apology in writing and a $500 travel voucher with the possibility of them being able to travel business class next time (Murphy, 2007). Although the compensation is resonable, Jetstar should have apologised face to face whilst the customers were stranded in the airport in order for the service recovery to be more successful. According to Lovelock et al, if the response time for compliant handling is done immediately, 56% of those customers that are involved will be satisfied (2004). It has also been discovered that 85% of the time, a customer whom had a very serious complaint can be turned into a loyal customer, so long as the handling of the complaint
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