Marketing Mix- Virgin Atlantic Assignment

Marketing Mix- Virgin Atlantic Assignment Words: 991

Virgin Atlantic’s Marketing Approach Introduction Britain’s the second largest carrier service. Its huge popularity has ensured its success worldwide. This success is also due to a strategic plan implemented buy Virgin Atlantic. This presentation will attempt to point out some of these key strategies Isolating Its Target Market The airline decided early on that its target market would be business men and leisure travelers. By catering solely to this target, virgin created a niche market for itself giving it a slight advantage over its competitors, who at the time, dealt with all types of customers.

This is market segmentation. [ (identifying-market-segments) ] It allowed the airline to focused all its efforts on ensuring its target audience It is easier to please a small select group of customers, than a large diverse on. Thus the airline has two classes, a business class and economy class. The business class passengers are primarily aged 35 to 45 and earn about ? 50 k and are usually on a business trip. Economy class is split evenly between business trip and leisure trips, average age is 41. [ (Virgin Atlantic Student information pack) ] As a result, the airline has enjoyed a constant increase in its customer base.

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In 1987, the airline had a 1,123,371 passenger count, by 2003, this had considerably increased to a 38,571267 passenger count . [ (Virgin Atlantic Student information pack) ] Happy customers As stated earlier, Virgin Atlantic is a very popular airline. Due to its successful efforts at satisfying its target market, these customers view the airline in high regard. They will be quoted as saying that it is dependable, comfortable and the best airline around. Such statements lift the airline higher over its competitors. This is known as positioning.

The airline is also involved in charity events, and fundraising. In 2000, the airline donated ? 401,850 to chosen charities. It supports about four charities a year, while having its on charity drive known as Change for Children. [ (Virgin Atlantic Student information pack) ] Marketing Strategy Virgin Atlantic utilizes the Seven P formula. This focuses on the airlines : * Products ??? ensuring they meet the ever changing and ever increasing environment * Price ??? rises or falls in airline prices affect the business based on different external factors i. e. rea economy, business capabilities, travel package. * Promotion ??? this refers to how the airline makes its products and services public i. e. through catalogues, advertising etc. * Place ??? the airline must select areas of operation where its target market is readily available i. e. UK, USA, Switzerland etc. [ (Tracy) ] * Packaging ??? how the airline presents itself and its products and services. This includes how you groom your employees. [ (Company Overview – online profile) ] * Positioning ???how people view the business. * People ??? employ the right people for the right job.

The airline currently employs 9000 qualified people. [ (Press Office – Online Interview) ] Your ability to select, recruit, hire and retain the proper people, with the skills and abilities to do the job you need to have done, is more important than everything else put together (Tracy) On the promotional front, the airline has an in house design team to design and produce letters, posters and videos. They work in conjunction with the marketing communication department that is responsible for keeping the public informed. [ (Virgin Atlantic Student information pack) ] Social Elements

The above points have helped the airline set a standard and remain one of the leading business and leisure airlines globally. By being such a huge company, it inevitably had to undertake corporate social responsibilities such as community development or donations. This aids in positioning the company while at the same time giving back to community. Another social element involves sponsorships. The airline sponsors certain activities in order to promote certain routes i. e. in 1997 Virgin Airline became the official airline for the Lions Rugby tour to South Africa, allowing them to open a Johannesburg service in 1997. (Virgin Atlantic Student information pack) ] Economic Elements The airline has to consider the environments economic situation as it conducts its business. It would be unwise to have the same air fares in Kenya as you would have in Switzerland or UK. This allows the company to retain customer loyalty in different countries, while still maintaining a profit margin. Also the airline now has other branch businesses i. e. investment banking which raise the company’s overall revenue. It has had a net worth of ? 1. 225 billion in previous years.

In fact the company has seen increasing profits since its inception, from ? 106. 8 M in 31 July 1989 and 208. 8 M in 31 July 1990 to ? 1500 M in 30 April 2002. [ (Virgin Atlantic Student information pack) ] Competitor Elements To maintain its lead over competitors, Virgin Atlantic is constantly forced to improve its services regularly. The airlines competitors keep Virgin Atlantic “on their toes” so as not to lose out on their target market. For as long as the services remain of high quality, than they need not fear the competition as much.

They could even raise prices to increase profits and not fill the dent in customer loss. Customer Elements The airline industry is fundamentally a service industry. Thus its focus is customer satisfaction. Its standards rise and drop at the sway of customer feedback. Its positioning is based on customer point of view. For example, in times of the recession the airline needed to be seen as considering the financial market and not burden its customer base with high prices. So it would have dropped prices a little while still maintaining high standards. The airline also offers customer loyalty bonuses.

Its Flying club, which is a frequent flyer mile promotion, is the primary tool for this. Conclusion I have merely attempted to highlight the marketing strategy the Virgin Atlantic uses in its successful business venture. All information has been references and sourced from various materials and my knowledge of marketing. Bibliography Company Overview – online profile. (n. d. ). Retrieved 04 20, 20, from Virgin Atlantic: http://www. virgin-tlantic. com/tridion/images/companyoverviewnov_tcm5-426059. pdf identifying-market-segments. (n. d. ). Retrieved 04 20, 2011, from

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