Proposed Strategies
Despite that Air Arabia has been having a competitive advantage for a significant period, the new competitive threats facing the company has forced it to come up with new business strategies. To overcome these competition hurdles Air Arabia has identified three main strategies. These strategies include growth strategies, marketing strategies and business direction strategies.
Growth and Market Strategies
- Expand the variety of the products and service offered to customers through diversification of the existing products. This will be supplemented by expanding the current market of the company.
- Increase the company market share and the number of employees.
The above two proposed strategies will be achieved through the following techniques
- Concentration Strategy: This approach will call the company to focus on the major business.
- Market Penetration: Realized through increasing the number of flights to reach the new target markets.
- Market development: Targeting new destinations
- Diversification: Combining different products both related and unrelated to the airline service industry.
Business Direction Strategies
- Being the fast and largest low-cost carrier. This will ensure that the company targets many destinations as possible and at the same time customers obtain quality services for the value of their money.
- To keep its talented employees to help the company to achieve its strategic goals, the company intends to provide long-term employment with career opportunities to its employees.
- Being the largest budget airline company as enshrined its vision statement.
Segmentation/ Target Strategies
Air Arabia is a global company. It has three major business hubs that include Borg Al Arab International Airport in Alexandria, Egypt, Mohamed V International Airport in Casablanca, Morocco and Sharjah International Airport in Sharjah, UAE (Air Arabia, 2016). These hubs have for a long time maintained the good reputation of connecting international airlines at low cost across the globe. This makes air travel more efficient and accessible means of transport. The company transport services are divided into Tourism and Travel industry. Travel industry offers travel facilities to customers traveling to other nations. Tourism industry deals with reserving hotels for the customers.
Further, the company travel business unit is divided into low cost and luxury classes. Air Arabia focuses on meeting the needs of the low cost customers by emphasizing on the ideology that people can pay less and travel more. On other the hand, the customers have been influenced that by traveling by Air Arabia Company means saving money. Therefore, they are ready to travel while experiencing little discomfort during the journey. Air Arabia has planted a perception of opulence and indulgence in the minds of its customers (Ali, 2014). This means that apart from the low-cost customers, the company has also won the hearts of the premium customers. These are customers who want luxurious traveling, and the cost does not matter to them. According to Kotler & Armstrong (2014), the markets have to know the qualities of their customers to meet their needs and demands satisfactorily. Likewise, Air Arabia has adopted this approach to target its customers based on their economic status.
Intended Positioning
After a company determines which market segments it anticipates to target, the next steps will be to establish where and how to create a perception of the product to the customers (Kotler & Armstrong, 2014). This calls for the application of positioning strategy. Positioning is a comparative approach that the customers use to differentiate the product of the company with that of the competitor (Kotler & Armstrong, 2012). The customers will position the product or service into his or her mind based on the benefits and attributes compared to other products offered in the market. Some of the key positioning techniques applied by the companies include emotion, competitor, class, product, product user, use, quality, and price and attributes (Palmer, 2011). Air Arabia has applied some of these techniques to position its products and services in the mind of the customers.
Air Arabia positions its products based on the aspect of price. Through this approach, the company has claimed the market of the low-income group as well low paid migrant workers intending to travel to their home countries during holidays. On other the hand, Air Arabia also applies emotion positioning whereby it focuses on the celebrities and high-income earners through offering them with luxurious air travel services. As Jobber & Ellis-Chadwick (2013) puts, positioning is not based on the product but in the mind of the customer.
Proposed Marketing Mix Strategies
The goal of each company is to realize as much revenue as possible from its marketing activities. For the company to achieve this objective, it has to get its marketing mix appropriately. The major marketing mix elements comprise of product, price, place, and promotion (Pour, Nazar, & Emami, 2013). Air Arabia understands the importance of marketing mix aspects, and therefore it has applied right strategies to ensure all of them are met.
- Product: As discussed above, Air Arabia provides a variety of products to its customers. The provision of the services is based on the target segment. To make sure customers access the company products with ease, Air Arabia has developed online booking. This will help to reduce the time customers’ takes to purchase company services. Again, Air Arabia offers hotel reservations and also recommends best options to their customers as per their budget and needs.
- Price: Low costs are the effective pricing strategy in Air Arabia (Ali, 2014). This means that the company will offer lower prices compared to other airlines. The company uses this approach to target the majority who are low and medium income earners.
- Place: Company products will be useless if customers cannot access them in the marketplace(Pour, Nazar, & Emami, 2013). The goal of Air Arabia is to increase its destinations. This will ensure that more customers can access the company products in addition to its three major existing hubs.
- Promotion: For the company product to sell well and claim a good market share in the market it will depend on its promotional strategies(Pour, Nazar, & Emami, 2013). Bearing in mind that Air Arabia is an international company, it concentrates its advertisements both on local and international arenas. The company advertises its products both in English and Arabic newspapers and magazines to target the customers of all nationalities. Additionally, Air Arabia uses its website and other social media sites to promote its products and services.
References
Air Arabia. (2016, June 22). At the Airport. Retrieved from airarabia.com: https://www.airarabia.com/en/our-hubs
ALI, Z. (2014, August 25). Segmentation, Targeting, and Positioning. Retrieved from www.academia.edu: https://www.academia.edu/10143015/Segmentation_Targeting_and_Positioning
Jobber, D., & Ellis-Chadwick, F. (2013). Principles and Practice of Marketing. Maidenhead: Mc Graw Hill.
Kotler, P., & Armstrong, G. (2012). Principles of Marketing. Harlow: Pearson.
Kotler, P., & Armstrong, G. (2014). Principles of Marketing. Harlow: Pearson.
Palmer, A. (2011). Principles of Services Marketing. Berkshire: McGraw-Hill Education.
Pour, B. S., Nazar, K., & Emami, M. (2013). The effect of the marketing mix in attracting customers:. African Journal of Business Management, 7(34), 3272-3280,
