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Jetstar Airways - An Australian Low Cost Airline

Discuss About The Market Strategies Promotional Activities?

Marketing plan is a complete plan about all the activities that is prepared by the entrepreneurs, when they introduce new products and services in respective market. It includes all the related aspects, which are needed for bringing a product or service in the market (Morden, 2016). An organization includes various aspects in this, like; objectives, target market, market segmentation, market strategies and other promotional activities. This report includes the description about an Australian Airlines, i.e. Jetstar Airways. It is a low cost airline in Australia. The company is introducing low cost services for the people, who cannot afford the air traveling expenses. This report includes some components of marketing plan for company’s products and services, like target market and marketing strategy of the company. The organization is implementing various effective strategies to promote the products in the market and all over the world. It is expanding its business operations in international markets.

Jetstar Airways Limited is an Australian airline, which is established in the year 2004. The organization is headquartered in Melbourne, Australia and offers low-cost airline services to its potential customers. It has launched its first local flight and promoted “Magda Szubanski” in the character of ‘Julie the Jetstar girl’ as the symbol of the organization. The company is offering value based services globally. This is a wholly owned subsidiary of Qantas and formed in response to the competition and challenges posed by another low-fare airline, i.e. Virgin Blue. The airline runs a widespread local network and international services as well from its chief base, i.e. Melbourne Airport, Australia.

Qantas established Jetstar airways in the year 2003 as its low-fare operations subsidiary (Jetstar, 2017). It has developed to work as one of the biggest airlines in Australia. It also operates its operations in domestic market of New Zealand. The organization is well-known for its low fares, every day to different locations. It has won various valued awards, like; “Best Brand Experience for Low Cost Carrier in 2006 and Best Low Cost Airline in 2007. This airline carries approximately 8.5% of all the passengers travelling in or out of Australia. Like its parent company, it also has the competition with Virgin Australia and its low-cost subsidiary, i.e. Tigerair Australia. Through this subsidiary, Qantas has shares in other sister airlines, like; Jetstar Japan, Jetstar Asia Airways and Jetstar Pacific Airlines (Jetstar, 2017).

Marketing Strategies of Jetstar Airways

The Australian airline industry is facing an intense competition due to entry of low cost airline, like; Jetstar Airways. It has strengthened the battle for occupancy rates and market share in Australian airline industry. The company is enhancing the customer loyalty by developing effective marketing strategies. It is the major key to survive in competitive aviation industry in Australia. Jetstar Airways has offered sub-par financial performance in nowadays because of customer complaints about poor quality services. Currently, Jetstar is working as one of the largest players in the low-fare airline segment in the country with fleet size of 44 aircrafts and 1900 flights weekly (Shaw, 2016). The organization has its presence in all major routes and 50 global markets through Asia Pacific region. Now, the flights of Jetstar fly to and from 19 Australian local and 17 long and short-haul international destinations. Currently, it is on third rank in largest airlines by market share in local aviation industry and in the list of top five international airlines in terms of capacity share. It is serving different international routes to and from Australian airport.

Regardless of its low-cost policy, the organization provides a limited number of linking services without via baggage checking, however it has altered since the international airlifts started in November 2006. The organization has added the baggage connectivity facility as a service for the local flights connecting overseas flights. As a subsidiary of the Quatas, Jetstar Airways offers more international and local flights in comparison to other airline player in Australia country. It has flown 75 million people since its launch in the year 2004.

The introduction of Jetstar is the part Qanta’s two brand strategy. Under this strategy, the company has two brands, i.e. Qanats and Jetstar Airways. One offers finest full-service market and Jetstar offers low-cost services (Anderson, Narus & Narayandas, 2009). Under its services, Jetstar offers to select the seat of their choice and it has become first airline in Australia, which allows the travellers to choose their seats on booking. Products and service offerings of Jetstar Airways are aimed to fulfill the changing needs of customers. The organization offers a right fare type for its customers.

Moreover, Jetstar offers a simple service that is exposed to the core for reducing the costs and prices and enhance the value for customers. Under its services, the customers get a flight and minimal baggage at its lowest (Armstrong, Kotler, Harker and Brennan, 2015). The company is using effective marketing strategies and market segmentation for promoting its services among Australian Market and all over the world. The organization has expanded its services to various countries, like; New Zealand, Asia Pacific region etc. This airline has a codeshare contracts with various airline organizations, such as; Jin Air, Qantas, American Airlines, Emirates, Japan Airlines, LATAM Chile etc. The services of company are very effective and unique from other airlines. It is offering the airline services on low fare.

Target Market of Jetstar Airways

For the promotion of these services, company is adopting and implementing various effective marketing strategies and targeting a market that is profitable for the company (Belobaba, Odoni, and Barnhart, 2015). The next paragraphs of this report include the discussion about the target market and marketing strategies of Jetstar Airways.

Target market is a market, where an organization wants to offer its products and services and it consists of different set of customers for whom it puts additional marketing efforts. Identification of the target market is an important step in creating a marketing plan. A target market can be determined by considering different factors, like; demographic, psychographic, geographic and purchasing power of the people.

Jetstar Airways is targeting the independents, which are 34% more likely to fly. Moreover, the company is targeting the residents of Victoria, Queensland and New South Wales, which are 7.6% possibly to go on an overseas holiday ( Bradley & Grant, 2015). In target market of company, household is exposing a higher than average income is more to fly with Jetstar Airways. In introducing this service, company is primarily targeting the people, who cannot afford travelling with higher fare airline.

Market segmentation is the process, in which a company segments the overall market on the basis of some specific characteristics, like; demographic, behavioral, psychographic and geographic characteristics. In its marketing plan, Jetstar is also emphasizing on these characteristics to target the market, so that it can promote its services in effective manner (Forgas, Moliner, Sánchez and Palau, 2010).

In context of geographic characteristics, Jetstar is selecting different locations for offering its products, like; New Zealand, Australia and Asia Pacific Region (Lawton, 2017).

Jetstar is targeting the people on the basis of socio-economic characteristics. In this process, it is offering its products to low and middle class people with the moderate income level. This is the primary market segment, on which company focuses (Fu, Lei, Wang and Yan, 2015).

In this type of characteristics, Jetstar is emphasizing on the age group of 18 to 30 year olds, who have low and middle level income capacity. Company is pursuing the low fare operations, so it is also an important market segment for the company (Jarach, 2017).

In this context, the organization is targeting the occasion segmentation, in which it is targeting short distance or some minute flights, which do not need the benefits, which other airline organizations provide, such as; business class, meals etc.

Market Segmentation of Jetstar Airways

Marketing strategy is an organizational practice that incorporates marketing and other objectives in a plan (Homsombat, Lei and Fu, 2014). A marketing strategy is stated to be effective when it is implemented for market research and focused on related marketing mix for earning significant revenues and profits. It will assist the firm in maintaining its growth and business environment. In addition, the marketing strategy can accounted as the basis of a marketing plan. It plays a vital role in achieving the objectives of company.

In this case, Jetstar is implementing various effective marketing strategies, which will assist the organization in creating awareness about its services. It will help the organization in enhancing its market coverage and market share. A marketing strategy of the company can serve so many benefits. For having these benefits, Jetstar is adopting several marketing strategies to achieve these benefits (Jiang, 2013). There are various strategies and marketing mix, which are adopted and implemented by Jetstar in promoting its airline services to its target market. These strategies are stated below;

Jetstar is an Australian airline that aimed to offer low-cost airline services both at local and international level. By adopting the effective marketing mix strategies, the organization can successfully implement the strategies to ensure the brand image, which it has been sustained for providing best quality services.

The products of Jetstar are the airline and transportation services to fulfill the needs of low and middle class customers. The company is helping the people in reaching to their destinations by their flights. The company is offering low-fare flights with the best quality services for low to middle income level people (Kachaner, Lindgardt and Michael, 2011). As it is wholly owned subsidiary of Qantas, so its fleets are luxurious, that provide comforts and good features. The major feature of their services is that people can choose their seats at the time of booking tickets.

Price is a major component in development of a marketing plan. Jetstar offers different packages for different income level customers. The major reason for introducing Jetstar airline is offering low-fare flights with some extra facilities. Furthermore, competition is also an important factor that determines the pricing strategies and policies of a company (Peppard and Ward, 2016).

There are two ways, i.e. direct and indirect, by which an organization can gain advantage in distributing the products and services to the customers. Jetstar is selling its services in different locations, like; Australia, New Zealand and Asia Pacific region. Through its flights, people are traveling in or out of Australia. It is selling its tickets at ticket counter at airport and on their website (Pearson and Merkert, 2014).

Conclusion

Promotion is the activities, which makes the organization able to advertise and communicate its services to the target market and customers. Jetstar has set up links with advertising agencies, so it is very easy to connect with its customers. Along with this, the company is promoting its products on modern platforms, like; social media networking sites. The company is using different marketing tag lines for enhancing its marketing promotion, like; “Jetstar girl” and “All day everyday low fares”. The major reasons behind success of its marketing campaign are these statements, which saw it as developed airlines for Australian flyers (Kleymann and Seristö, 2017). The promotional activities of the company are enhancing the usability and access of its services.

Thus, these marketing strategies will assist the organization in increasing its presence among its customers. Jetstar should adopt new and effective strategies to deal with the intense competition in the Australian aviation industry.

Conclusion  

Thus from the above analysis, it can be concluded that marketing and promotional activities play a significant role for any organization, when it comes to introduce its new products and services. These activities can assist the organization establishing its brand reputation in the market and among customers. The above report includes the analysis about Jetstar Airways. Jetstar Airways is a famous airline with its low-cost operations. It serves the customers and business travellers with its transportation services in Australia and other countries. The report includes the background of company and description about its products and services. Moreover, it describes the target market and market strategies of Jetstar airlines. The above analysis concludes that the organization is adopting and implementing effective strategies and marketing tactics to enhance its brand image in the respective market.

Furthermore, it is hereby recommended that the organization should include some market campaign in promotional activities. It should implement more effective strategies to reach to its target market. These steps will assist the organization in increasing its presence in market and among customers.

References

Anderson, J. C., Narus, J. A., & Narayandas, D, 2009, Business market management: Understanding, creating, and delivering value. Pearson Prentice Hall.

Armstrong, G., Kotler, P., Harker, M. and Brennan, R., 2015. Marketing: an introduction. Pearson Education.

Belobaba, P., Odoni, A. and Barnhart, C. eds., 2015. The global airline industry. John Wiley & Sons.

 Bradley & Grant, 2015, "Regional shake-up: Jetstar to break Air New Zealand's domestic stranglehold". The New Zealand Herald. 

Forgas, S., Moliner, M.A., Sánchez, J. and Palau, R., 2010. Antecedents of airline passenger loyalty: Low-cost versus traditional airlines. Journal of Air Transport Management, 16(4), pp.229-233.

Fu, X., Lei, Z., Wang, K. and Yan, J., 2015. Low cost carrier competition and route entry in an emerging but regulated aviation market–The case of China. Transportation Research Part A: Policy and Practice, 79, pp.3-16.

Homsombat, W., Lei, Z. and Fu, X., 2014. Competitive effects of the airlines-within-airlines strategy–Pricing and route entry patterns. Transportation Research Part E: Logistics and Transportation Review, 63, pp.1-16.

Jarach, D., 2017. Airport marketing: Strategies to cope with the new millennium environment. Routledge.

Jetstar, 2017, Flights to Australia, retrieved from https://www.jetstar.com/au/en/cheap-flights/australia.

Jetstar, 2017, Cheap Flights, retrieved from https://www.jetstar.com/au/en/cheap-flights.

Jiang, H., 2013. Service quality of low-cost long-haul airlines–The case of Jetstar Airways and AirAsia X. Journal of Air Transport Management, 26, pp.20-24.

Kachaner, N., Lindgardt, Z. and Michael, D., 2011. Innovating low-cost business models. Strategy & Leadership, 39(2), pp.43-48.

Kleymann, B. and Seristö, H., 2017. Managing strategic airline alliances. Routledge.

Lawton, T.C., 2017. Cleared for take-off: structure and strategy in the low fare airline business. Routledge.

Morden, T., 2016. Principles of strategic management. Routledge.

Peppard, J. and Ward, J., 2016. The strategic management of information systems: Building a digital strategy. John Wiley & Sons.

Pearson, J. and Merkert, R., 2014. Airlines-within-airlines: A business model moving East. Journal of Air Transport Management, 38, pp.21-26.

Shaw, S., 2016. Airline marketing and management. Routledge.

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