Ryanair Marketing Analysis

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Table of Contents

Introduction
Ryanair
Analysis of the business’s environment
A discussion of the company’s resources
Segmentation within the sector
Segments targeted by Ryanair
Conclusion
Reference List

Introduction

Companies conduct market research with an aim of improving on their competitiveness. This is essential for continued growth of such companies. In this regard, they analyse various aspects of service delivery and customer satisfaction as well as competitors. In so doing, they fast track their ability to perform effectively and efficiently in the market.

Airline industry is both competitive and challenging. The cost of fuel is ever rising. In addition, technological advances and innovation is constantly proving to be expensive to airline companies. This has put increased pressure on companies to perform. Moreover, customers are usually unpredictable even though they need quality services.

Ryan Air, which is one of the most successful flight companies in the world, has had to work towards offering cheap quality flights to achieve customer satisfaction. It has employed several pricing techniques in order to satisfy the need of various groups of customers. This has enabled it to achieve high market penetration as well as perform fairly in a market that is highly competitive (Cadwalladr, 2012, p. 1).

Ryanair

Ryanair is a multinational airline company that was founded in 1985. Over the years, it has strengthened its presence all over the world with a mission of providing quality service in order to contribute to society. Having begun with just 25 employees, the company has sprung up and now boasts of 8500 employees. The company is in Ireland with its headquarters in Dublin.

Ryan family founded the airline, which has since emerged as a world market leader. Ryan airline is considered the largest in the category of low cost airline throughout Europe. It runs nearly 1500 flights daily from around 51 bases. Its first cabin crew was only 5 ft. 2ins. This happened because of the small aircraft they begun with in 1985. In 2011, it was estimated that Ryanair carried about 75 million passengers.

It has routes in 28 countries with a connection of more than 168 destinations. Despite its low cost measures, the company is considered the most profitable in the world. This shows how consumers love to spend less for quality services. Moreover, the company’s economic policy has enabled it to achieve these impressive results despite news of heavy losses made by most airline industries in the world.

This has made them the leaders in airline industry (Bachelor, 2012, p. 1). Currently, they have opportunities in emerging markets such as Asia, South and Central America as well as Europe for cheap flights that are efficient and save on the cost of transport. The company boasts of about 300 aircrafts (Boeing 737-800). These are the newest aircrafts in Europe and most probably the world with just 2 years as their average age.

In essence, opportunities are solid as they seek to venture into more regions as well as improve on the quality of service they provide. According to news polls, most customers across Europe and in other parts of the world are hoping that Ryanair would reach their destinations. This shows how the company has managed to be successful in planning and strategising for better results.

The company has seen growth from a meagre 25 employees to thousands of them. This great achievement occurs in a market that struggles to sustain itself. Most companies are barely managing to pay their expenditure. Ryanair’s business model is highly successful. It should be followed by other airline industries that are struggling to sustain their employees.

For instance, 2011 sent shockwaves across the world with rampant strikes by airline employees for better pay as well as massive cutbacks to help sustain the industry. Ryanair’s model is thus important in achieving sustainable airline activities (Edreams International Network, 2013, p. 1).

Analysis of the business’s environment

Market analysis aims at studying the dynamics and attractiveness of a given business environment within an identified industry. It primarily takes two separate forms. In the first form, investors use market analysis to oversee and analyse its growth curve in order to come up with investment decisions. In the second form, market analysis is a field of study employed by marketers to examine the market in target.

Regional and urban economics is the field of studying real estate market analysis in regional and urban setup level. The following segment will look into the business environment of Ryanair (Casselman, 2011, p. 1). Ryanair has utilised its low cost model to achieve significant growth over the years. However, it has faced a number of problems in this regard.

For instance, the media has accused it of charging extra charges on passengers due to on board charges. However, the company assured customers that they aim to encourage customer that do not carry luggage and do not need other services to pay the least possible amount. Moreover, charges that are alleged are optional since one can choose not to carry a language. Its low cost model has also brought renewed criticism on payment methods, which is alleged to place extra charges on customers (Tutor2u, 2012, p. 1).

In addition, their employees have also faced a number of issues since their pay is less than that of other airline employees. This has brought controversy because they are also alleged to have convinced their employees not to join workers union. This is because employees are also allowed to buy shares in the company and thus give them an opportunity to contribute to the running of affairs at the company.

The company’s bargaining power has helped it spur growth as they trample their competitors in both cost and quality of services offered. Porter’s analysis gives a positive outlook on their ability to offer competitive advantage. This is attributed to their resource base, price service, and appeal to customers with the latest jets.

A discussion of the company’s resources

Ryanair has a customer base of about 75 million people. This is huge considering that it is a low cost airline. The low cost business model has enables it to move forward at a rapid rate. This is also attributed to Europe’s deregulation policy on aviation industry. The airline boasts of more than 300 aircrafts with connection to about 170 destinations. It had revenue of 4.325 billion euros in 2012 with an operating income of 683.2 million euros.

Moreover, it had a net income of 374.6 million euros. Moreover, its assets were estimated at slightly more than 9 billion euros with equity of 3.308 billion euros. In addition, the company boasted of about 8400 employees in 2012. This shows a massive growth since its expansion in 1997 (Edreams International Network, 2013, p. 1).

Threats that face Ryanair include upcoming competitors as well as increasing cost of flight operation. These include fuel costs, which are driving the cost of transport. Moreover, some customers feel that their relatively cheap prices would be related to quality, a notion that is false but can as well work against them.

In this regard, they need to perform thorough tests of products before launching them to avoid such misgivings as those witnessed in the sticking accelerators. Moreover, they should pursue technology in order to appeal to more customers through efficiency, reliability, and cost effectiveness.

The SWOT analysis of Ryanair shows that a lot has been done to assure customers of their reliability due to series of success witnessed. In addition, the company has been instrumental in evaluating its performance. Risk assessment techniques such as SWOT analysis show strength in economic policy, which has energised them to their current levels. This helps to improve a company’s competitiveness.

Segmentation within the sector

Airline sector has segmentations that have enables smooth conducting of activities. For instance, there are two major segmentations namely, are the low cost airline and the high cost airline. This ensures that airline choose to align with one of the industry’s segmentation to pursue their goals. For instance, there are passengers who would not want to spend on extra services provided onboard.

These group of passenger can pay very low amounts to travel to their destinations without incurring extra charges that are compulsory in high cost airlines. Moreover, they have the option of buying whatever they want as opposed to the other segment in which a standard fee is charged (Greenslade, 2013, p. 1).

Segments targeted by Ryanair

Airline industry deals with transport of people as well as goods. This is essential in effective safe transport of goods and services. Ryan air targets low cost passenger transport as part of its business model. It offers cheap services as compared to its counterparts such as EssyJets. Moreover, it uses the latest technology of jets in Boeing to spur its growth. However, it is important to note that challenges it faces in this line.

Ryanair offers on board services at a cost. This is aimed at making these services optional for passengers to have lower costs of travel. In addition, the airline aims to provide customers with informational required expedition of its services (Edreams International Network, 2013, p. 1).

A discussion of how (or whether) these three elements are related to the business’s performance

Market analysis helps in evaluating the market clients and ascertains the most viable courses of action necessary to enhance profitability and sales. Investors generally analyse numerical data, existing market patterns, and probable future patterns of a specific data in carrying out market analysis. They carefully analyse the price movement within a specific sector, events that may affect their commodities and the entire market trend.

They may also investigate events like emerging technological discoveries, announced mergers, and profit predictions. The three elements stated above are crucial to the survival of any business model. For instance, airlines that offer low cost services must have enough resources to target numerous customers. This enables them to achieve their goals of high profits through the man customers.

In essence, low cost model depend on numbers. In this regard, the relationship between these elements is clear in that a firm that chooses to go for low cost segment must have enough capital bases (resources) to get the numbers required for profitability. Moreover, business environment must also be conducive for such services to take place in a successful manner.

Ryanair therefore prides itself in finding the unique model based on its resources and segment chosen. However, it is important to note that this has not gone easily as the company faces numerous customer relation issues pegged on their low costs.

For instance, some quarters have accused them of paying employees meagre wages while others have accused them of evading tax. Overall, it is necessary to note that these elements are related and have to work together for a company to thrive in airline services as well as in most business sectors (Skyscanner, 2013, p. 1).

Conclusion

Ryanair has the largest base of customers in low cost airline industry throughout the globe. This is attributed to the economic policy they adopted which has attracted more customers as well as retained their profitability levels. However, this has not come easy. The company has passed through periods of difficulties when accused of evading tax and charging extraneous services on ticketing, among others.

Despite this, they have continued to expand. Currently they have over 300 fleets of aircrafts connecting more than 168 destinations. This is massive for a firm that started with barely 25 employees. Moreover, the challenging market rocked with ever-increasing cost of operation has done little to stop its success.

Issues related to their employees have also rocked the news with workers union accusing them of exploitation of workers for higher profits. However, they have reiterated that their focus is to ensure employees own part of the company. Ryanair is a success story that relates the three elements of marketing namely business environment, segment, and resources.

These elements are essential in marketing and must work together for success. However, they still face other challenges. These include addressing of employee issues as well as the need to venture in emerging markets and consolidate their position in areas of establishment (Ryanair, 2013, p. 1)

Reference List

Bachelor, L., 2012, ‘Ryanair introduces extra booking fee.’ The Guardian. Web.

Cadwalladr, C., 2012, ‘Ryanair deserves a new name.’ The Guardian. Web.

Casselman, B., 2011. Consumers’ Fears Hobble Economy, Jones Reprints, New York.

Edreams International Network, 2013. Ryanair flights: Timetables, fares and book Ryanair. Web.

Greenslade, R., 2013, ‘Sunday Times apologises and pays damages to Ryanair.’ The Guardian. Web.

Ryanair, 2013. Cheap Flights: Book cheap flights to Europe with Ryanair. Web.

Skyscanner, 2013. Ryanair flights. Web.

Tutor2u, 2012. Marketing: Pricing approaches and strategies. Web.

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