The Background Information Of Malaysia Airlines Marketing Essay

The Background education Of Malaysia blood bournes Marketing EssayMalaysian product linelines System Berhad (MAS) is the holding company for Malaysias bailiwick skyway carrier, virtuoso of Asias fastest growing skyways. Through several opposite subsidiaries, the company manufactures agate linecraft parts, byers trucking and onus transportation go, caters food, provides laundry and dry-cleaning services for pushoerways and new(prenominal)wise industrial institutions, and oversees a travel agency. Company Ch crinkleman Tajudin Ramli owns a meaningful sh atomic number 18 in Malaysian joblines System (MAS), and the Malaysian disposal retains a strong voice in MAS affairs.In the premium merchandise segment, MAS is on a down in the mouther floor tremendous pres positive(predicate) from full service carriers (FSCs) who atomic number 18 striding ahead with first- yr class products, cutting and modern aircraft, and fast-expanding driveways. On the other hand, in the equipment casualty driven market segment, MAS is as well as strongly pushed by low exist carriers (LCCs) with low nourishments. In a nutshell, MAS must reinvent itself to fend off competition from FSCs and LCCs. MAS aspires to become the Worlds Five Star Value Carrier. MAS believe that they relieve oneself to reinvent themselves to achieve this vision.CUsersmicDownloadsmas.jpg3.0 Situation Analysis3.1 General environs AnalysisDemographic segmentThe demographic segment is to the highest degree the commonwealth size, age structure, geographic distribution, ethnic mix and income distribution. Malaysia is a multiracial acres and its population comp testifys of 28.6 trillion of people. The government aims for increasing the national population to lxx million by the division 2100. in that location is 63.8 portion of the population lives in urban ara while simply 36.2 percent of population bash in rural area.The passenger load factor (PLF) of an respiratory tract, is a stair of how much of an airlines passenger run awaying skill is used. It is passenger-kilometersflown as a percentage ofavailable. The PLF of Malaysia is 67.8, 60.7 for Asia, 74.9 for europium and shopping centre East, 73.6 for Australia and newborn Zealand, 72.6 for Africa and South America, 60.6 for Orient and North America.Besides, Malaysia is recently realize a new policy which with the purpose of making the Malaysia to become the tall income nation. This signifi foott policy had show the increase of Malaysian income in the succeeding(a) time.Sociocultural plane sectionThe labor force in Malaysia has been increase from year 2003 to year 2010. It reached a capacity of 11.38 million of people in the year 2010. http//www.indexmundi.com/malaysia/labor_force.html. It is found that the youths who are in between of the age of 15 to 34 basically make up the commodiousst labour force in Malaysia. They are makeup of 42.5% of the total population, roughly 9.75 million of people . http//www.mtuc.org.my/young_workers.htm. It is also found that the women in the workforce call for got increased. This is due to the case that a lot of countries rush endorsed legislation such(prenominal) as Equal Opportunity for Women in the workplace Act to protect the women in the workforce. Besides, there are some a(prenominal) reasons to pardon why the women have increased in the workforce. For example, women are more improve and more skil guide. http//www.strategic-human-resource.com/women-in-the-workplace.html.There are various type of airline careers raise in the airline patience, such as pilot, captain, copilot, second officer or flight engineer, flight at hug drugdant, flight dispatcher, and meteorologist. air hose diligence employs those people with extremely diversify skills regard little of the sex. It is proved that the flight attendants comparable the stewardess or steward symbolize the major job sector in the airline industry. For instance, there a re nearly 80000 flight attendants in United States airline industry. http//www.targetwoman.com/articles/airline-careers.htmlHowever, it is found that the age discrimination cases have been happened in the United States airlines. full stop to the pilots pick outd retirement policy such as Age 60 Rule, pilots are forced to retire at age 60. This is because the airline industry believed that the pilots are not able to per exploit the job well at the age of 60. They believed that the pilots are place the airline company and the passengers in jeopardy if they are permit to fly. http//www.targetwoman.com/articles/airline-careers.htmlGlobal Segment advertiselines have participated in globalization and consolidation. They link their network through the establishment of alliances and partnerships to expand the access to their clients. For example, the terra firma gentle wind market is shared between the global alliances such as KLM or North West, Atlantic virtue alliance, STAR, and Br itish Airways or Ameri whoremaster Airlines alliance. http//adg.stanford.edu/aa241/intro/airlineindustry.htmlThe airlines industry has targeted some relevant new long name global market in order to expand their services such as Asia Pacific and china, South Asia, Northeast Asia, Southeast Asia, and Oceania (Australasia). It is believed that close of the airlines exert the new global market in Asia Pacific and China. This is due to reason that China has grown promptly and the urbanization of China had caused it became the dynamic aviation markets. The urban population has been increased from 302 million in year 1990 to 622 million in age 2009. It is expected the population provide come up to one billion by year 2025. Besides, the domestic passenger calling is projected to grow on an average rate of 7.9% in China. Boeing, as the Chinas leading provider of passenger air excogitatees, predicts that about 71% of the demand in China is the single-aisle airplanes with the full deliv eries of 3090. http//www.globalintelligence.com/insights-analysis/asia-news-update/asia-news-update-november-19-2010/malaysia-malaysian-airline-eyes-indian-chinese-mar/http//www.boeing.com/commercial/cmo/china.htmlPhysical Environment SegmentThe neat majority of the airlines have developed their own comprehensive programmed to reduce the environmental remains and produce a more environmentally product. Based on the research, the members of alliance in the airline industry have arouse the give notice strength of the aircraft and create not as much of greenhouse gases like the old aircraft and are quieter. Basically, there are some international industry bodies like IATA (the International Air Transport experience), Association of European Airlines, the Association of Asia Pacific Airlines, the USAs Air Transport and others are fully support the environmental activities.Based on the global perspective, there is fewer than 2 percent of the worlds total carbon dioxide which produc e by the airline industry macrocosm released. The passenger aircraft nowadays are more environmentally friendly as it is 70 percent more burn down efficient than 40 old age ago. For example, Airbus A380 and Boeing 787 Dreamliner are more fuel efficient aircraft. In addition, the noise footprint which produces by the aircraft is naturally 50% more quiet than those aircraft in ten years ago. According to IATA, airlines are planning to improve the fuel efficiency of the aircraft and carbon dioxide emissions in another 25 percent more. It is also plan that in the coming year 2025, the fuel efficiency of the aircraft ordain be improved in another 30 percent.http//es.oneworld.com/enes/ow/news-and- teaching/fact-sheets/fact-sheet?objectID=35tempURLParam=http//www.travelgreen.org/industry_landing2.htm?select_industry2_id=33Technological SegmentThere are many airlines currently using proprietary frustrate in systems which bequeath convert all its check-counter to the ARINCs MUSE common -use system. City Airport, Logis strike (CALT) can make better use of its available counter blank shell because it allow for help to provide a convenient in townsfolk check in. The improvement of the check in counters at CALT is economically feasible. In addition, many of the airlines involved already have experience with ARINCs MUSE applied science at Incheon and Gimpo. They will be able to make the transition at CALT with little extra cost.http//www.arinc.com/news/2010/10-07-10-vmuse-seoul.htmlBesides, technology also can be used to enhance node relations. It will help to create contraption for consumers. The industry can offer travelers a web inter facial expression customized to a specific type of travel. The web interface can direct the guest to services with the desire benefits but cost a little more. some other than that, the automated check in machines is available in some airlines. Travelers can swipe a credit card through the automated check in machines as ident ification and print out their tickets instead of checking in with airport staff. The new technology also helps airlines to track lost luggage. There are Radio Frequency Identification (RFID) systems which will help to enhance aircraft unit loading devices and help boost security.http//gulfnews.com/business/aviation/new-technology-helps-airlines-track-lost-luggage-1.703356stinting SegmentA low cost airline generally has many features that differentiate it from the traditional carriers. These features include ticketless travel, online ticket sales, no international offices, no frequent flyer points, no free food and beverages, no in-flight magazines, no club lounges and use of subsidiary city airports. In the early economic regulation of airlines, the government is concerned more on their participation in the airmail system. The Air Mail Act of 1925 allowed the U.S. government to pay airlines for carrying the mails.http//www.centennialofflight.gov/ undertake/Government_Role/Econ_Reg/ POL16.htmBesides that, Air Asia was re-launched in Malaysia as a low jazz and low cost domestic airline. Air Asia is promoting low fare of Indonesia Malaysia commove which will help it to open the Indonesia market. It will help Air Asia to rise up the economic growth. Air Asia also provides its services between capital of Singapore and Bangkok by introducing a 2nd daily flight to its quick schedule. Air Asia is offering its guests promotional fares to/from Singapore-Bangkok which is much lower than the lowest fare SGD$56 offered by full service carrier. It will help Air Asia to open the Singapore market.Political / Legal SegmentAirlines political achievement committee is a huge donor when compared it with those big companies in other industries. For example, Singapore Airline is currently facing or might face political strategies in near future. SIA could face problems of entering the new markets like China and increase market share in existing network. It is because many airlin es are still government owned and much of the trade in aviation services is still controlled by governments. Besides that, siamese connection Air Asia is a joint venture which is established by Air Asia with the jumble Corp. clamber Corp is owned by the family of Thailands Prime Minister, Thaksin Shinawatra. There are about 900 million baht will be invested in Thai Air Asia over a five-year period. Shin Corp oversees the finance and judicature of Thai Air Asia while Air Asia shoulders the responsibility for marketing and operations. Shin Corp has financial strength which will help to support Air Asia to grow. Therefore, Air Asia with its politically positionful may well grow up to bite. (function() var scribd = document.createElement( playscript) scribd.type = text/javascript scribd.async = true scribd.src = https//www.scribd.com/javascripts/embed_code/inject.js var s = document.getElementsByTagName(script)0 s.parentNode.insertBefore(scribd, s) )() 3.2 Porters Five Forces AnalysisThreat of new entrantsAs justify form the environment, any new company or organization to entering this airline industry is not easy due to the several kinds of entry barriers may discourage competitors from entering a market. The level of barriers to entry depends on the customer loyalty. For example, customers from Malaysia Airlines who is satisfying in brand loyalty will resolving power the tall switching costs towards other airline company. Exception for the price nociceptive customers, they may prefer cheaper price flight tickets. Besides, capital requirements for a new company to start up the airline business are huge. New entrant or infant company has to spend a full-size capital to compete with existing airlines due to the fail of participate in economies of scale. The cost of setting up of offices, sullying or leasing aircraft, hiring pilots and others staffs like air stewardess is a fix cost which create a gritty barrier for the new entrants. Inf ant firm or industry require a long time period to significant their products or services specialty, such as Full Service Carriers (FSC) in Malaysia Airline. Through government policy, governments can also control new firm to participant in airline industry. Government steep level of protection towards the major airline may result many new firm unable to tack the requirements and regulations and enter the industry. Thus, threat of entry towards the airline industry is high.Bargaining big businessman of suppliersPower of suppliers is important as it will directly affect the industry. In airline industry, the power of supplier is moderate result from there are sole(prenominal) two major supplier which are Airbus and Boeing so most of the firm like Malaysia Airline (MAS), Singapore Airline (SIA) and others need to buy the aircrafts from them. The satisfactory substitute products are low make the larger of power in suppliers. In addition, industry firms are not a significant custom er for supplier group. The suppliers good is important to the MAS in order to harbour a success in market place.Power of buyersBuyers are one of the factors which will impact to industry. Nowadays, price sensitive customers are increase directly. On the other hand, number of customers who is concern the services differentiation is rise and result low cost oriented and full service carrier oriented. Customers secure the only small portion of the industrys output and do not large participate in the company annual sales. Besides, buyer or customers will obtain a high switching cost in call of loyalty result from the MAS superior services performance. Thus, the bargaining power of buyers low to Malaysia Airline.Threat of substituteThreat of substitute is substitute is product or service which can replace the original products or service. Not only the others airlines, customers also can choose others transportation system such as train, bus and ferries but air travel is more convenien t and double-quick compare with other transportation. Businesses which require a faster and safe tour may choose airline cargo as their transportation.Intensity contender among competitorsIn this case, the threat of rivalry is high to the Malaysia Airline. This is because various large as balanced competitors such as Air Asia, Tiger Airway, Singapore Airline and etc are provide almost the similar services. As a result, high rivalry to the MAS because more firms must compete with same customers and resources. Besides, lack of differentiation product is difficult to compete with other firm. Malaysia Airlines (MAS) have successfully place their product as full services carrier and have less rivalry. Rivalry in slow industry growth becomes more anxious as firms battle to increase their market shares. The main competitors of MAS are Asiatic carrier like Singapore Airlines. So MAS intends to reassess the proceedsiveness of its route network both international and domestic. This in volves reviewing the viability of the existing fare structure and routes and the realigning of its aircraft capacity to markets that offer the greatest opportunities.Homehttp//www.hicbusiness.org/biz2003proceedings (journal)http//en.wikipedia.org/wiki/Malaysia_Airlines3.4 SWOT analysis based on stakeholder groupsCapital market stakeholdersStrengthsBased on the market stakeholders, MAS have diversified their revenues stream to avoid uncertainty. It generates revenues from various areas, for example which is deal with freighter flights and aircraft cargo hold (Scribd, n.d.). Moreover, MAS had diversified into colligate industries such aircraft ground handling, aircraft leasing, aviation engineering, air catering and tour operations. This can lead to MAS to maintain a accordant growth and give a competitive edge.Next, MAS had improving in dampen which can be defined as the revenue per revenue passenger kilometer (RRPK). There are two significant projects which are the driveway Prof itability Project (RPP) and the Revenue Enhancement Project (REP) had been implemented by MAS in order to increase their revenue (Datamonitor, 2008). Regardless of minor diminish in load factors, the yield had more improvement as compared to the balance for the decreases of load factor. This had shown that the Revenue per Available Seat Kilometer (RASK) has also increased by 14 per cent (Datamonitor, 2008). As a result, there is an depict shown that a strong increase in the profit and the efficiency of MAS.WeaknessesBesides, MAS was describe negative bullion flow from the operations in their company over the past couple of years. In 2005, the negative notes flow of MAS was about $ 157.2 million (Datamonitor, 2008). However, in the fiscal year of 2006, MAS had reported net cash outflows of estimated $ 41.6 million from their operating activities (Datamonitor, 2008). This affect MAS financial health as the cash flow continuous is negative. The negative cash flow will also tighte ned the cash resources and limit the liquidity of cash for working capital needs. piece of music many businesses were go through many mischiefes and difficulties in the related industries, MAS still using a huge amount of capital to support its business effectively for providing an excellence services for their customer (Scribd, n.d.). Consequently, the risk that incurred by MAS in the future is very high and the possibility for MAS to having a loss will be increase.Product market stakeholdersWeaknessesEven though MAS had its humble beginning in the golden age of travel but this airline will still having some weaknesses in their business. MAS as a 5 star international airline needed higher cost for the fear and convenience (Scribd, n.d.). Therefore, customers purchase will be affected due to the effect in the real cost of airline tickets. This can lead to MAS only focus on the market with high income. However, there is not many people can effort to pay for the cost for flying to other country because of this higher price in airline tickets.OpportunitiesMAS had the chances to introduce a new concept of flying with MAS due to the customers different needs and desires in the term of buying (Scribd, n.d.). The different needs and desires of customers are because of the several factors such as demographic, geographic and psychographic factor. Thus, customers are human beings which can be good to have a change in their life. For example, MAS had introduce hot repast boxes which offer several favorites such as nasi lemak and nasi goreng kampong to respond the preferences of customer while they are continuing to optimize the aircraft utilization in line (Scribd, n.d.).Furthermore, MAS had been approved to launch fire beetle which was a new low-cost fellowship in the March of 2007 (Datamonitor, 2008). MAS as a parent airline for Firefly allowed Firefly to take over its B737-411s to serve more primarily secondary airports in the country and also within the Indones ia-Malaysia-Thailand Growth Triangle (Emmanuel, 2010). Thus, MAS can regain their market share which had lost in the recent years on local and regional routes as compared to its low-cost competitors like Air Asia. This is a chance for MAS to look at returning to a row of growth.Also, MAS has a very strong existence in the Asia. It can counterbalance many regional destinations and various destinations in the country like China, Japan, India and the Middle East where there are higher in demand for air travel (Datamonitor, 2008). The increased in the demand for air travel will drive MAS to emerging in the Asian country like China and India (Datamonitor, 2008). Therefore, the revenues earn by MAS from the Asian region will increased.ThreatsThere are some negative elements from the outside of the organization which will affect MAS in the aviation industry. Jet fuel is an important portion of the operating disbursement of all airlines. The increasing in the price of jet fuel will affec t the bottom lines of most of the airlines in the world. MAS are also include due to the sharply increased in the price of jet fuel (Datamonitor, 2008). As a result, the margins of MAS will come under pressure.Organizational market stakeholdersStrengthsMAS have provided several strengths based on the organizational market stakeholders that spring companys competencies and capabilities of their core business in the aviation industry. MAS have established a strong brand image which is being highly recognized in the local market and the international market (Miller, 2010). In order to fabricate a strong brand image, MAS had provides excellence services to all of their customers almost the globe. With the excellence services provided by MAS, it had won the Staff Service Excellence for Asia award. In the year of 2010, MAS was known as the winner of the Worlds Best preservation Class Award at the 2010 World Airline Awards (Miller, 2010).In addition, MAS have a strong and better design ed in their organizational structure. Their attention team is talented and plays the significant responsibility in planning and overbearing their action in the service system in order to carry out the excellence brand experience (Scribd, n.d.). Management teams of MAS always have their own strategy to overcome the difficulties and losses. Besides, they also can make sure that they have the ability to improve their service quality.WeaknessesThe poor oversight and inefficiency of the management team and network are the weakness to the MAS organizational market stakeholders. or so employees tend to read from the newspapers, media and rumors from their friends when MAS had incurred billions of losses in 2005 (Lian, 2010). The staff of MAS were discussed the issue in the closed room. It is not a healthy environment for MAS because the level of imprecate and confident between the management and employees are very low.OpportunitiesMoreover, technology developments had led the MAS Comp any to effectively manage their knowledge in management. As a result, MAS employees will gain rapid learning and greater intelligence that will lead to the generation and sustenance of competitive advantage (Foon Eurn, 2009). Besides, the advancement in technology can replace several inadequate legacy story system and thus it help MAS to enhance their quality and relevance information for management in making decision and important reduction in manpower (Foon Eurn, 2009).