Easy Jet, Strategic management project
- External environment: Industry analysis.
- Internal environment analysis.
- Main Strategic recommendations.
- The first strategy: A concept that works.
- Diversification strategy for the future.
- Developing other segments.
The airlines industry has been highly perturbed by many new external and internal events since the last five years (September 11th, increasing of fuel value, and recently many technical incidents in some flights). All these components transform major stakes and keys of the different airlines strategy. In fact, safety and fuel costs became the key point of most of the company. Airline industry had always strong and heavy regulations, charges and taxes. To the customers in Europe, airline transport had a long time an image of inflexible and high prices offers. The competition was not strong and the major (national airlines) had nearly the monopoly of the market. The arrival of Easy Jet was like a revolution. Easy Jet stakes in the market representing as the low-cost leader airline operator in Europe. It has a basis company on a customer relationship (a cost effective and yet qualify level service). Its strategy is clearly to reduce costs and offer price under the market (virtual offices: internet sales, externalisation of different process).
[...] The 5 forces model of competitors Strategic segmentation of the airline industry Airline industry can be analyse into three criteria which are type of clients, distance (long, medium or short flight), and customers' needs satisfied. Customers We can divide them in two classes, in function of their price elasticity. Business population do not pay attention to the price. At the opposite, tourist and middle class consider the price as the first condition of choice. If the price seems to be too expensive, train and car can be substitutes. [...]
[...] The bus ticket will be sold on the internet website, but separately from the plane ticket, and available on a diiferent coupon in order to make the difference between the two services. The taxis network will carry the companies' colors but will have an other name, as recognazable as the others firm activities. We can propose easyTaxi or easyCab. We know that easyJet is making low rates. Nevertheless, it might be a good idea to run a system points in order to fidelize the client. If it is too costly for the company, some discounts should be applied on other firm services, like on easy Rentacar or [...]
[...] This avoids the need for expensive management controls and its costs related. New fleet strategy EasyJet's strategy, based on its current business model, requires acquiring a low total fleet operating cost. In 2002, EasyJet and Airbus concluded an agreement: 120 Airbus A319 aircraft (delivery over a five year period from 2003 and last delivery is planned in 2012). Few low cost operators have any experience of operating the A320 family of aircraft. Airbus has agreed to provide extensive pre-delivery and ongoing support relating, specific support as training for pilots, cabin crew and maintenance personnel. [...]