Qantas Airlines: Service Marketing Analysis - Case Study Example

Service Marketing Analysis Contents Service Marketing Analysis 1 Service Marketing Analysis 2 Introduction 2 Qantas Airlines: Company profile 3 Marketing mix analysis 3 Price 4 Product 5 Place 5 Promotion 6 People 7 Process 8 Physical evidence 8 Recommendations 9 People 9 Promotion 10 Price 10 Product 11 Conclusion 11 Service Marketing Analysis Introduction It is evident that the right approach in any firm’s marketing strategy is important in attaining and maintaining sustainable competitive advantage in the market. This becomes more fundamental when a particular firm is confronted by massive competition in the market which endangers both its short and long-term viability. Consequently, the application of an ideal marketing mix is imperative in the process of identifying the opportunities in the market, launching new products as well as surviving both real and prospective competition in the market. This fact is supported by Anderson (1982) who determined that the role of marketing in strategic planning involves the identification of the most suitable long-term positions for the firm which stresses the necessity for proper identification of the opportunities in the current and future market. Against this background, this paper will explore the marketing approach of Qantas Airlines as a form of a tourism infrastructure with significant attention to consumer service component. In addition, recommendations on how this service might be enhanced will be developed in the latter section of this analysis. Nonetheless, it is fundamental to briefly explore the profile of this airline in order to gain a comprehensive insight into some of its most rudimentary undertakings founded on the need to satisfy tourism consumers. Qantas Airlines: Company profile According to Qantas Airlines website (2012), this airline was founded in 1920 and has evolved into becoming the largest airline in Australia, both at the national and international levels. The success of this airline is concretely founded on its long established reputation of customer service, reliability, safety, engineering and maintenance as well as operational reliability. On a very basic level, the primary business of Qantas group is based on transportation whereby two complimentary brands of Qantas and Jetstar are usually used. In addition, it also runs other supplementary businesses which include but not limited to airlines and businesses in particular markets, for instance, Q catering. In regard to tourism, Qantas airline has been credited for extensive promotion of events which are directly linked to tourism, for instance, Cradel Coast Tourism Forum, Queensland Outback Tourism Awards and Lord Howe Island Tourism Association among others. This exhibits a robust commitment towards the advancement of this sector in the rural and regional Australia. Moreover, this airline works collaboratively with other segments of the Qantas group to promote regional tourist destinations both within the boundaries of Australia and oversees (Qantas Airlines website, 2012). Marketing mix analysis This analysis will center on the 7Ps of marketing which are price, product, place, promotion, people, process and physical evidence elements. Price Roos et. al (2006) noted that after an epoch when Virgin airline which is the primary competitor to Qantas won approximately 30% of the Australian market share, Qantas responded by establishing its own low-cost airline, Jetstar and eventually delegated some strategic routes mainly to tourist destinations to this subsidiary airline. Thus, this reveals a strategic approach of Qantas as a response to the nature of competition in the market. The pricing strategy of Qantas also focuses on giving value to consumers. This perception is determined by all the features of the product which include those not related to price, for instance, prestige and quality. This will make the buyers willing to pay for the product. Lastly, Qantas offers discounts to consumers to encourage them to choose this specific airline, mostly to their tourist destinations. Thus, the pricing strategy of Qantas can be summarized as follows; Value-based pricing: A central tenet of value based pricing is that the firm ought to communicate to the prospective consumers of the value and benefits they receive (Smith, Hogan & Nagle, 2004). This is founded on the perception of the consumers in regard to the value as opposed to the cost of the product. Discount: This is founded on the reduction of the advertised price. Tin regard to Qantas, this includes things reduced prices during public holidays and in certain specific routes. Competitive pricing: This is founded on the range of prices being offered by other competitors. For instance, it offers lower price than offered by Tiger Airways or Virgin Blue for the same travel destinations. This has been key in making Qantas achieve a competitive niche in the market. Product This is mainly related to consumer service. In its marketing efforts, Qantas usually sends a clear message to the consumers in regard to the different benefits that they will experience after choosing to travel with them to diverse tourist destinations. This includes aspects like lower airfare, regular flight schedules, top quality, booking convenience and diversity in destinations both nationally and internationally. This is best epitomized by the fact that Qantas communicates consideration of consumers with special needs whereby the airline assures them of a travel experience which is not only comfortable but also hassle free (Qantas Airlines Website, 2012). In addition, the guarantee to diverse categories of consumers about their safety, convenience in seat selection and check-in options communicates the quality of consumer service at the airline. In addition, apart from Qantas airlines providing diverse route options to different tourist destinations, the airline also makes extensive efforts in ensuring that the consumers have an experience of flying with Qantas even prior to getting on board. This is through informing them about the inflight cuisine as well as the entertainment systems while on board among other services (Qantas Airlines Website, 2012). All of these help in communicating the diverse benefits which different classes of consumers will enjoy in choosing to travel with Qantas airlines. Place From a general perspective, this refers to getting the services to the consumers which entail where the services are made, sold and distributed. Qantas airline is accessible to tourists at any time of the day at Qantas center in the Mascot suburb of the Botany Bay city. In addition, the subsidiary airline (Jetstar) is located at in Qantas domestic terminal in the Melbourne airport (Jetstar website, 2012). This is fundamental in ensuring that all the needs of the consumers are taken care of in one central locality in disregard of their income margins. Moreover, this locality is accessible to tourists and other categories of consumers from all walks of life within the shortest time and with the cheapest means available. This is integral in marketing since it assures the consumers that the quality services that they seek are accessible at their own convenience and that they can choose from a wide range of services in the same location. Promotion Bruch (2006) perceived promotion as the act of furthering the growth or development of something. This entails the mechanisms that Qantas Airlines uses in its efforts to inform the consumers about what type of services that it have in regard to quality, price, outlets, quality, merits above other airlines among other aspects. Due to the technological dynamics in the recent decades, Qantas has extensively embraced technology based channels like the internet to inform the consumers about their prices, outlets, discounts, destinations among other tenets. The imperative role played by the internet in contemporary marketing is supported by Yannopoulo (2011) who inferred that the internet has a massive influence on the pricing strategy of a firm in regard to increased awareness, research in pricing, provision of more information to consumers among other merits. Consequently, the Qantas airline website has been central in promoting the latest services by this company as well as informing the consumers on the most recent discounts and flight schedules among other promotional information. In addition, the print media like newspapers and magazines have also been paramount in the promotion of the services from Qantas airlines both at the national and international level. This is not to forget the television which has also been chief in the promotions for instance, in travel advice. People This includes all the persons who are either directly or indirectly involved in consumption of various services being produced by the airline, for instance, the consumers and the employees among other stakeholders. Much of the commitments by the airline towards meeting the needs of the consumers and actions in case of any unforeseen contingency are contained in the Qantas Consumer Charter (Qantas Airlines Website, 2012). The ways in which the airline deals with people, especially the consumers is fundamental in the marketing process based on the fact that consumers who are satisfied with services from the airline are bound to spread the word about the exemplary services at Qantas airlines, winning referrals in return which is closely linked to promotion. On the other hand, the way in which the company deals with the employees directly impacts on their motivation and commitment in offering quality customer service. In this regard, Qantas airline makes extensive efforts to fairly treat the employees in order to ensure that there is efficiency in the consumer service delivery. Process In a generic sense, process can be perceived as the delivery and operational mechanisms of procedures, systems as well as flow of undertakings which services are consumed. In the process of service delivery, Qantas airline has a sequence of steps which are integral in effective and efficient service delivery. These process ranges from checking the flight status, booking, boarding the flight and eventual arrival at the destination. In addition, the Qantas Consumer Charter mentioned above clearly outlines the process of handling consumer complaints as well compensation in case of delay or cancellation of flights among other reservations. This is best epitomized whereby in case of an overnight delay of a flight, the airline provides the consumers who are away from their home port with accommodation, meals and transfers at no extra cost (Qantas Airlines Website, 2012). Physical evidence This is the last P in the 7Ps analyzed in this paper. Physical evidence relates to the environment under which the services are delivered to the consumer as well as the tangibles that assist in communication and delivery of service. At Qantas airlines, the environment is conducive for service delivery whereby quality infrastructure is instituted to support this objective. This is best epitomized by the Qantas Club which offers exemplary leisure and networking services to registered consumers. In addition, the availability of lodges within the airport ensures that the needs of the consumers who have been affected by delays are catered for, thus making the process of delivering services to consumers effective (Qantas Airlines Website, 2012). Recommendations These recommendations will be based on the people aspect of the marketing mix as well as three other aspects analyzed in the preceding discourse. People Qantas airlines ought to make more profound efforts in the recruitment and training of new personnel aimed at familiarizing them with the diverse dynamics in the business, mostly with the advent of new class of consumers in the subsidiary airline. This is based on the fact that these new consumers have a different character and service preferences when juxtaposed with the traditional class of consumers at Qantas. This will be fundamental in effective service delivery. This is supported by Queensland Government (2011) who revealed that providing exceptional consumer service is fundamental in the creation of a positive consumers experience and the eventual marketing of one’s brand to them. In addition, Qantas airlines ought to enhance its rewards and recognition system aimed at motivating the employees and making them committed to innovation and creativity in service delivery process to the consumers. Promotion Qantas airlines ought to focus more efforts and resources in sending sales persons to the target market to sensitize them about the new services available in the airline, mostly those who don’t consume advertisements in the internet. Afterwards, the company ought to collect feedback from them which will be used to improve the services in the long-term. The company ought to regularly conduct this exercise to ensure that the quality of the services will be reviewed from time to time in order to meet changing consumer demands. This is supported by Rosen, Schoroeder and Purinton (1998) who inferred that it is imperative to be cognizant of the need to clearly identify and profile a target market, and bear in mind that the profile of the target market will change overtime. Price Qantas airlines ought to initiate extensive discount rates to upcoming tourist destinations both in Australia and internationally. This will not only be imperative in promoting these tourist destinations, but the company will also gain a favorable niche in these new opportunities above its competitors which will be central in maintaining sustained competitive advantage in the new market. Product Lastly, Qantas airlines ought to expand its portfolio in terms of the services that it provides in the market, for instance, instigation of special tourists class in its flights in addition to its exclusive business class. This will attract more tourists to its services which will be fundamental in its penetration in the tourism industry. Conclusion From the above discourse, it is apparent that Qantas airline has used a strategic marketing approach in its operations which partly explains its popularity in the market. Nonetheless, there some tenets that ought to be integrated in this marketing mix to ensure that prospective consumer are endowed with adequate information about the available services in the airline. In addition, the pricing strategy of the company ought to consider the needs of tourists to upcoming tourist destinations in the national and international market. These tenets are outlined in the recommendations section in the preceding discourse. 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