proposal for British Airways

BRITISH AIRWAYS MARKETING 1

A review of the marketing strategy of British Airways and its effectiveness

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Institution:


Executive Summary

The aim of writing this project proposal is to present a well argued, clear and justified

description or explanation of the project that has proposed to be completed. The proposal will

help in answering questions that entail what will be researched, why is the research chosen, and

how will it be attained. There are three issues that need to be considered in addition to this, these

are research philosophy, research design and research ethics. In the introduction and background

of the research and its importance has given; the same has been highlighted in the literature

review so as to justify it and also justified whole research using Research methododlogy.


TABLE OF CONTENTS

Introduction……………………………………………………………….…………4

Background Information………………………………………………....4

Research Questions………………………………………………………….4

Literature Review………………………………………………..……………5

Research justification…………………………..…………………7

Methodology……………………………………………………………………7

Research philosophy……………………………….…….......7

Research design…………………………………………………..8

Limitations…………………………………………………...........9

Research ethics…………………………………………….….....9

Timetable for Completion...............................10

References………………….……………………………………………….....12


Introduction

British Airways, is amongst the best airlines in the world, and has one of the most

extensive route networks, internationally. The airway is working in an extremely challenging and

dynamic competitive market calls for constant innovation and improvement, in addition to

provision of high value for money. Differentiation is achieved through excellent customer

service across its flight network. In the given proposal we have tried answering certain questions

to review the effectiveness of marketing strategy followed by British Airway. The paper also

concentrates on the challenges the company is facing by applying such strategies.

Background information

British Airways, is amongst the best airlines in the world, and has one of the most

extensive route networks, internationally (British Airways, 2010: n.p). The airline’s income has

been on the rise over the years. In the 2012 financial year only, the company’s income was

£10,827, translating to over 8.4% revenue increase as compared to the last financial year.

Marketing at British Airways is meant to positively portray British Airways to customers in

order to make certain it remains the choice flyer for thousands of passengers across the globe.

Working in an extremely challenging and dynamic competitive market calls for constant

innovation and improvement, in addition to provision of high value for money. Differentiation is

achieved through excellent customer service across its flight network. Additionally, constant

should be placed creating a strong brand name for the airline. Sadly, the recent past, British

Airways has faced stiff competition not just, Lufthansa that is its major competitors but also

upcoming airlines from various parts of the world. This highlights the importance of reviewing

BA’s marketing strategy.

Research questions

1. How effective is the current marketing strategy at British Airways?

2. How has the changing global environment impacted of BA’s marketing strategy?

3. Does British Airways need to change its marketing strategy in light of the challenges it

faces?


Literature review

The company’s annual reports highlight the risks and uncertainties which affect British

Airways with emphasis on the ones that are critical for its continued maintenance and operations.

British Airways, like other major global airlines faces multiple risks including government

regulation non-compliance, infrastructure challenges, competitors encroaching into its markets,

staff unrest, Information technology failures, fluctuating oil prices, currency fluctuations,

security issues, threat of terrorism, natural disasters, debt funding, interest rate fluctuations, and

Middle-East tensions.

At the end of the 70s, air traffic deregulation in the United States opened doors to

increased competition. In 1990, the common market enabled deregulation in Europe leading to

entry of low-cost airlines. Additionally, the rise of internet platform has largely changed airline-

customer relationships. Additionally, the changing economic fortunes, alongside fluctuating fuel

prices are major factors affecting the airline industry.

Conventionally, any GDP changes are reflected in the airline usage. The same is the case

with fuel prices; sadly, fuel prices today are 50 % more than they were in early 2010. Obviously

then the 2009 economic crisis lead to one of the least profitable years in the airline’s history.

The global recession and European economic downturn largely affected all international airlines.

Consequently, British Airways also recorded reduced bookings due to decline in international

travel reservations.

However, 2009 came to be the best year, thanks to reduced fuel prices, demand recovery,

as well as growing demand for cargo services. In 2010, the global airline industry made a

whopping $15.9 billion profit translating to a 3% margin. Nonetheless, competitiveness remains

then biggest challenge the airline industry faces, and by extension, British Airways.

Another important area where British Airways is facing challenges in compliance to the

ever-changing environmental governmental regulation. However, it is widely argued that the

industry’s interest with regard to carbon emissions is in line with ecologists’; the lesser the fuel

burned, the more the money saved. Investment in highly efficient and cleaner engines, light

aircraft and biofuel programs mean air travel should move towards being carbon-neutral

(Antony, J. et al., 2003). However, such investments are costly.

Legal suits are also another problem that plagues British Airways. Lawsuits damage the

corporation’s reputation. Other than law suits, loss of cargo technological failures are also an


area of concern. According to a study by association of European Airlines, noted that BA lost

luggage of an average of nine passengers on each jumbo jet flight in 2008 and was bound to be

forced to cancel more than 200 flights in days following the opening of terminal 5 failure of

computer log-on for luggage handling which sparked chaos. Additionally, British Airways faced

stiff competition from other service providers including Lufthansa, Jet star and Tiger Australia.

Whilst Lufthansa enjoyed a monopolist reign over corporate sector flyers, Jet star and Tiger gave

it stiff competition in low-cost airline market sector (Knibb, 2011, p. 34).

The environment where British Airways flies is substantially dynamic and hence

unpredictable. Amongst the major challenges in the sector include fuel price fluctuations, natural

disasters such as floods and earthquakes, staff union strikes as well as the ever changing global

economic fortunes. These are elements known to adversely affect the airline industry and not just

British Airways. 2008 world economic recession resulted into a huge reduction in leisure travel

volumes. This coupled with the rising domestic competition in terms of pricing made it difficult

for British Airways to make any substantive profits as well as other low-cost airlines.

Additionally, the increasing market liberation has seen international players also join in

competing the market enjoyed by British Airways. Nonetheless, Lufthansa remains the single

largest competitor to British Airways enjoying near monopoly in the business airline sector of

the market (Knibb, 2011).

As a game changer, British Airline’s CEO introduced a myriad changes include the

revamp of the existing fleet, creating world-class lounges as well as introduction of new staff

uniform as a way of attracting the rather choosy corporate travelers. The changes were purely

meant to get a share of the rather reserved corporate travel segment believed to make about 20%

of the corporate travel sector (Flynn, 2011, p. 82).

For an organization to be able to sustain itself in a dynamic and extremely competitive

environ, there is need for the organization to be able to cope with change (Magnusson, Krsolid &

Bergman, 2003: 54). Additionally, there is need for proper planning more especially with respect

to the required investments, level of staff involvement/motivation, as well as understanding of

the counter-movements by competitors and the outside environs (Shields, 2009). Change is very

difficult to predict in an external environment where lots of dynamic things happen. Nonetheless,

it is easy to anticipate change if it is to be handled in an effective way. British Airways has made

substantive efforts in an effort to market itself and maintain its relevance in the market.


Research justification

The fact that the airline industry is one of the most challenging is not far-fetched. As a

matter of fact, this is an industry that despite experiences substantial growth continues to face

serious challenges. It is therefore unsurprising that British Airways finds itself in the midst of

stiff competition within a market it previously dominated. Being the topmost airliner across the

globe, understanding its market dynamic offers useful case study not just for learning but also for

other industry players. Over the recent past, the airline industry has undergone extensive

changes. Since the mid-90s, new airlines have emerged, some low cost while others expensive

and luxurious (Montgomery, 2005, p. 45). Some have been able to stay afloat while others have

gone under a short while after being commissioned. In essence, the mixed fortunes are indicative

of the delicate airline industry market and hence it is important that any proposed new airline

gains an understanding of the market prior to entry if it is to achieve success (Lowa, 2012).

Airline demand forecast requires in-depth understanding of various factors including

competition, frequency of travel, pricing, capacity issues, and economic fluctuations, among

others.

Research Methodology

RESEARCH PHILOSOPHY

For this particular research the method can be said to be qualitative in philosophy rather than

quantitative. It means that the data will not be too much in numeric or in other words the data

which is not quantified (Saunders et al, 2003, p.486). This philosophy can be said to be the

height of complexity as many areas can be analyzed through this philosophy, the most complex

actions are categorization of standard and non standardized data, for example business models,

etc. A thematic approach will be followed so as to analyze the data. Therefore it will be the best

option to collect the data from secondary sources first; secondary sources will include readily

available data. Though, the data will however not be good enough to adopt the framework, but it

can be built later with its support (Saunders et al, 2003, p.388). In order to give a better look to

the report academic literature will be used to describe the outcome of the research.


This philosophy is probably best for this situation as the basic aim of the project is to identify

underlying reasons, believes and attitudes and after that some actions can be taken. As a matter

of fact it is the main benefit of the qualitative study. Which means the main focus will remain on

research and analysis of market entry, and culture and strategies of corporate sector. This

research will first present the information in form of data and after that a theoretical framework

can be made out of it.

RESEARCH DESIGN

Research is mainly categorized in two types, i.e. primary and secondary research.

Primary research is that research where the data is collected by directly interacting with

participants, but most importantly the one which is not published and used anywhere before

(Ritchie et al, 2013). On the other hand secondary research is that research which is already used

by some another researcher. Secondary research can be done by using research articles, books,

publications, surveys, etc.

Case study is one of the best advised studies for proposals. If the person wants to understand the

in deep benefits and meaning of research it is the most suitable method. This is the method which

answers all the questions for detailed research. This strategy can even be used along with some

other strategy based on exploratory, descriptive and explanatory studies, in such situations it is

very easy to make explanations.

Mixed methodology will be used in this study. Both primary and secondary data will be used. In

order to collect the primary data semi structured interview will be conducted so that a reliable

data can be used to get the answers for the questions. In the interview a minimum of three

organizations has been planned to interact with. Some sample questions will be sent to them so

as to make clear what the research is about. This method has been chosen because, it gives the

answers to some questions and in addition to that it gives the reaction according to the answers.

It is not compulsory that the questions for all three organizations will be same; they can be

changed or modified. Primary data in the interview will be recorded by taking some notes in

between the interviews and by tape recording the whole interview as well.

This technique of critical sampling will give the clearer image to the researcher that what exactly

is happening in the organizations. In order to do that, the researcher must be able to divide the


answers under some common topics; it will help in improving the analysis and the visual

comprehension. It would be wrong to say that the sample taken out of the three given

organizations represents the true picture; however it won’t be wrong to say that it will give some

insight in the area of operation which can be beneficial for other organization in the same field.

However, the data from the worlds’ shared databases such as EBSCO host, JSTOR,

Oxford and Pro Quest will also be used for the secondary purposes. The articles can also be used

in the study but only those in between the 2008 and 2014 if it is before 2008 then they will be

eliminated.

In case the study is qualitative like in this study usually all the data which is gathered is

analyzed through thematic analysis. In thematic analysis, analysis is done on the basis of

literature reviews based on the available data which is presented in a theme created by the

researcher.

RESEARCH LIMITATION

One of the major drawback in the methodology used is with the security of qualitative data, it is

very difficult to handle complexity of interpretation in the personal interviews, on most of the

occasions lack of personal experience creates most complexity, and sometimes the analysis of

time consumption of interview transcripts. However, if a person is aware of these it can get him

prepared for these things in the interview in the best manner they can be handled.

RESEARCH ETHIC

It is made sure by the company that their rules and privacy policies will be respected by the

candidates who are invited for the interview. Before the actual interview some questions are

given to the candidates so as to make sure that the candidate is familiar with the purpose and

objectives of the research. Candidate is rejected if he fails to answer these questions as per the

expectations.

Before the interview is done, consent is taken from the candidates that their interview will be

recorded on tape. Before the interview the candidates are also told about their right that they can

decline to answer any question they want and they can ask to stop the interview anytime they

want.


After the interview is done, a recorded copy of the session is made available to the concerned

parties. It is for sure that the information which is supplied should only be used as per the pre-

agreement. There are some cases of biased analysis or misrepresentation of data a copy by the

researchers in order to make their work simple, but in order to avoid such situations a

dissertation can be sent to confirm before the actual report is submitted officially.

TIMETABLE FOR COMPLETION

While conducting researches, time is very important factor, as the researches from recent

time period are considered to be more beneficial. Therefore, hence it gets very important for the

company to maintain a timeline from the beginning of research so that all the objectives and

things for the objectives could be achieved as per designed timeline. Timeline is very important

so at the time of deciding the timeline it is necessary to understand every component and give it

sufficient time which should also include some extra time as required in case of unfortunate

incidents.

TASKSWEEKS

1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31

Construct research proposal

Draw up questions for Survey

Submit proposal

Timetable interviews

Begin survey

Analysis and redefine

problem(s)

Implement findings

Prepare draft report

Begin full data analysis

(Thematic Analysis)


Write final Project


References

Lowa, S 2012, ‘Supply and demand metrics for airline industry’, Journal of Supply and Demand,

vol. 32, no. 4, pp. 45-52.

Lowa, S. 2012, Supply and demand metrics for airline industry, Journal of Supply and Demand,

vol. 13, no. 6, pp. 45-52.

Steiner, P. O 2009.Markets and Industries, Crowell Collier and MacMillan Inc.: New York

Tierney, J 2013, British Airways Listens to Its Customers and Makes Changes in Rapid Rewards

Loyalty Program, Daily News, Sep 26, 2013.

Saunders, M, Lewis, P. & Thornhill A 2003, Research Methods for Business Students, Prentice

Hall: England.

Ritchie M. D., Denny J. C., Zuvich R. L., Crawford D. C., Schildcrout J. S., Bastarache L., et al.

2013, Genome- and Phenome-Wide Analyses of cardiac conduction identifies markers of

arrhythmia risk.

proposal for British Airways

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