Airasia Marketing Strategy

1921 Words8 Pages
Introduction Price is all around us. You pay accommodation fee for your hostel, tuition for your education. You pay transportation fee such as airline, railway, taxi, and bus. And the bank charges you interest for the money you borrow, the price for parking your car at shopping mall. Your hairdresser asks charge for cover his service. The “price” of an executive is a salary, the price of a salesperson may be a commission, and the price of a worker is a wage. Price is the amount of money charged for a product or service, or the sum of the values that consumers exchange for the benefits of having or using the product or service. Price in marketing Price is the odd-one-out of the marketing mix, because it is the revenue earner.…show more content…
First, AirAsia operates on a non-ticket service that saved the airline about US$1 for each ticket. Second, it offers no meal or other services. Instead the airline sells meals and snacks to the passengers. Third, AirAsia works through supply chain management to get its supply-part inventory. It has a strategic alliance with GE Engine Services Malaysia Sdn Bhd and Airline Rotables Limited. Fourth, it cuts unnecessary cost through not offering any connection flights and trains pilots to save fuels. In addition, the airline does not offer onboard entertainments, which consume fuels and their maintenance is high. Fifth, the airline operates only one type of aircraft. In line with its growth and expansion plans, AirAsia has ordered 175 A320 aircrafts from Airbus. This order will make AirAsia the single largest customer for the aircraft in Asia-Pacific. The new aircraft would gradually replaced AirAsia's existing Boeing…show more content…
Malaysia Airlines has on the average sold 70 per cent of the seats. The 70 per cent seats sold gives Malaysia Airlines its normal profit. Without effective business strategy, the other 30 per cent unsold seats will reduce profit, and Malaysia Airlines has to bear the costs. The “Everyday Low Fares” strategy helps Malaysia Airlines via fuel surcharge to provide contribution to its fixed cost. This can be shown by the 6 per cent increase in revenue to RM3.7 billion from RM3.5 billion; its profit falls from RM132.7 million to RM120 million as the increase in fuel prices is more than its surcharges in the first quarter of 2008 and 2007 (New Straits Times, 21 May
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