AirAsia Analysis
This work was made to complete Integrated Marketing Communication SM205 individual assignment in UCSI University Kuala Lumpur, and the brand analized was AirAsia.
The assignment was to analyse and improve AirAsia by using four Integrated Marketing (IM) components, which are PR, Advertising, Marketing and Branding.
BACKGROUND
AirAsia started in 2001, when Dato’ Tony Fernandes along with Dato’ Pahamin Ab. Rajab (Chairman of AirAsia), Dato’ Kamarudin bin Meranun (Deputy Group Chief Executive Officer of AirAsia) and Abdul Aziz bin Abu Bakar (Director of AirAsia) formed a partnership to set up Tune Air Sdn Bhd and bought AirAsia for a token sum of RM1.00. With the help of Conor Mc Carthy (Director of AirAsia, Former Director of Tune Air Sdn Bhd and former Director of Group Operations of Ryanair), AirAsia was remodeled into a low cost carrier and by January 2002, their vision to make air travel more affordable for Malaysians took flight. Valued at RM3.3 billion, AirAsia is today an award winning and the largest low cost carrier in Asia. From a two aircraft operation of Boeing 737-300, AirAsia currently boasts a fleet of 70 aircraft that flies to over 50 domestic and international destinations and operates over 400 domestic and international flights daily from six hubs located at Low Cost Carrier Terminal (KLIA), Johor Bahru, Kota Kinabalu, Kuching, Bangkok (Thailand) and Jakarta (Indonesia). AirAsia is fast spreading its wings to create a bigger and more extensive route network through its associate companies, Thai AirAsia and Indonesia AirAsia. The airline has carried, thus far, over 50 million guests since its first day of operation.
(This is taken from the official AirAsia company profile)
INSIGHT
Problem : People never experience flying because the flight tickets are expensive
Solution : Now everyone can fly because AirAsia offers low-fare flights
VALS CONSUMER CATEGORY
Believers
Because believers are less liberals and more structured, so values and ideals matter, especially from the historical track and the credibility of the company. AirAsia is considered as a reliable and credible airline company that has been winning the Best Low-Cost Airline for six years and is offering low-cost and on-time flights with no accidents.
Strivers
Since AirAsia offers various routes, a striver is one of the consumer categories because they like to seek temporary relief and have getaway holidays. One of the ways to spend a holiday is by travelling.
Experiencers
Similar to Strivers category, they like challenges and being exposed to new things, experiences, and places. Therefore experiencers suit to be AirAsia consumer category.
Survivors
By its’ Unique Selling Point, which is offering low-fare flights, AirAsia is the best airline for survivors consumer category because they are calculative and they do not want to waste their time, money and energy. AirAsia covers it all.
SWOT ANALYSIS
Strength
Strong brand image as a low-cost airline
Safe, no accidents so far
Various routes within Asia
Fast turnaround
Good partnership with online travel agent and other companies
World’s Best Low-Cost Airline for 6 years running (2008-2013) by Skytrax
Multi-currency online sales
Weaknesses
Price is not that cheap if the tax and everything is added
Bad flight experience
Available flight is only within Asia
Bad customer service
Bad media coverage, especially online media
Sexist advertisement & exposure of stewardess pictures in all publication mediums
Placed in low-budget airports
Opportunities
Reduce puffery; more realistic and honest for the price and ticket reservation process
Improve in-flight service
Expand the routes and aircrafts
Improve the customer service
Increase the quality and number of online media and mainstream media coverage
A change for advertisement style
Standardize the airports
Threats
Economy crisis & tax increase
Fuel price increase
Website and data-server technical problem
The online travel agency offers the comparison of all competitors’ prices
Amendment of government policies and aviation rules
External Problem (Volcano, bad weather)
INTEGRATED MARKETING
PUBLIC RELATION & NEED
Press Agentry
AirAsia has done a pretty much good job to get media exposure and coverage through their press releases and campaigns, either using the mainstream media or online channels. A lot of campaigns have been done and covered in media, especially Corporate Social Responsibility on employees, on environment and on society. For the example; AirAsia is the first airline company that hires female pilot; AirAsia improves its fuel efficiency by upgrading its aircrafts; AirAsia joins hands with UNICEF for Haiti in 2010; To Japan With Love in 2011, aimed at increasing traffic to and from Japan and raising money to donate to disaster relief and recovery; To Philippines With Love with #toPHwithlove in social media in 2013, aimed to help the Philippines people reconstruct their shattered lives after The Typhoon Haiyan; and Love Is In The Air 90 pairs of free seats for its Valentine’s promotion. The media that mostly expose AirAsia campaigns are Bernama Malaysia, The Star Malaysia, and The Rakyat Post Malaysia. In 2010, AirAsia appointed global media network giant Mindshare to handle its media account in Malaysia. Mindshare is a UK-based agency under GroupM, a leading global media investment management operation. Besides the mainstream media, AirAsia also uses the online social media such as Facebook, Twitter, Instagram, Weibo, YouTube and travel-related blogs.
Public Info
Acting as the journalist of the community, definitely there are a lot of sponsored contents that act on behalf of AirAsia. One of the examples is the article titles “10 Reasons We’re No.1” for the 10 years AirAsia celebration, published on the newspaper and magazine. Besides that, there are a lot more articles about AirAsia and its CSR, AirAsia and its Airbus and absolutely, the AirAsia promotion as a sponsored article.
Two ways Asymmetrical
AirAsia is using the two ways asymmetrical strategy instead of two ways symmetrical to influence the public to think that everyone can fly with AirAsia, as the tagline says. AirAsia also uses its AirAsia Mobile Apps that available on iPhone, Android, Blackberry and Nokia and Mobile Website to inform the mobile users the latest AirAsia news and promotion.
In my opinion, AirAsia has a strong PR and has a strong value to make everyone able to fly with its low-fare flights. But then not many people know and in fact, a lot of people who have experienced flying with AirAsia already think that AirAsia tickets are not as cheap as they are said. This might make the consumers choose the other non low-cost airline because they think that the other airlines have a better quality and almost or exactly the same fare with AirAsia. Another way to influence the people better is through campaign. As we know AirAsia often does or joins a travel fair that is held individually or together with the other airlines and agencies. A new idea that can be offered is to let the people experience or try flying with AirAsia. For the example, a flying simulation at the event campaign, or maybe a mobile device game, or online game that give the chance to the players to win a ticket to some place. This is can be categorized under promotion marketing too. So while AirAsia is trying to influence the people and increasing the number of consumers, it can generate more revenue by its additional products or campaign like this.
ADVERTISING & NOISE
Applying the concept of advertising, AirAsia is being straightforward yet they put a little subliminal message of sexism on its’ advertisement. However, its’ advertisements are effective enough to make the consumers and audiences understand the service or promotion offered. It is just the matter of the audience point of view, whether they like it or hate it; they either understand it or don’t; they either fall for it or they don’t. Mostly, they understand it and they hate it.
AirAsia has been shouting the same message in a different frequency through its Above-The-Line (ATL) advertisements and Below-The-Line (BTL) advertisement. For the ATL and BTL advertisement, not many TV commercial that AirAsia has – only 1 video per year since 2006, and it was played on Astro, AXN, and StarWorld, and of course, Online YouTube Channel & Commercials. There is no radio commercial found so far and a lot of print commercials such as billboard advertisement, smaller board advertisement and print ad advertisements on magazine and newspaper (commonly only when they have a new campaign or promotion)
Unfortunately, among all of those mentioned advertisements above, sexism was used in most of them to deliver the message to the audience. AirAsia is famous for portraying their women flight attendants. For the example, for its “Have You Flown AirAsia Lately” Television & YouTube Video commercial, there was a 7-years old kid saying, “She (my grandmother) said the flight attendants were hot!”
There are more sexist advertisements by AirAsia. Another example is the billboard and print ad advertisement showing five stewardesses serving a guy that looks so happy surrounded by tight-clothing AirAsia girls in red, added with “HOT” caption below. Besides sexism, AirAsia also sometimes indirectly brings down its competitors’ image with their sarcastic line, such as "If Tigers were meant to fly, they would be born with wings", it is asummed about targetting Tiger Air.
Competition
To successfully generate a different noise, knowing its competitors is necessary. AirAsia main competitors are the Airline Company from the neighbor country, Tiger Airways Singapore Pte Ltd, operating as Tigerair and Jetstar Airways, a wholly owned subsidiary of Qantas, created in response to the threat posed low-cost Airline Virgin Blue. Same as AirAsia, both are low-cost airlines that operating service to regional destination in Southeast Asia, Australia, China and India. Tigerair and Jetstar are not as well known as AirAsia yet because they started in 2003 while AirAsia started in 1993; but it doesn’t mean that Tigerair and Jetstar will not catch up and lead.
Objective
Apart from expecting the audience to fly with AirAsia, the advertisements use a good reach instead of frequency. The reason behind this decision is because AirAsia is not targeting particular consumer, although it has consumer category. As its tagline, “Now everyone can fly”, AirAsia is targeting everyone to fly with them, that is why reach is a better decision rather than targeting on the frequency.
Money and Placement
AirAsia is smart enough to not have a radio commercial because the print ad and video ad will do well. Besides that, not all television channel or YouTube channel are used for the video ad. Its official media partner such as Astro, AXN and StarWorld have shown the most AirAsia ads.
In my opinion, changing the advertising concept might be better. Instead of using sexism or sarcasm to advertise AirAsia, why doesn’t AirAsia focus on family oriented advertising, such as showing a happy family is enjoying their flight with AirAsia – since most of the AirAsia consumer is Asian and Asia is more related to the collectivism culture, or the culture of Asia, to promote the various routes offered by AirAsia; or portraying a backpackers enjoying their time, since the most visited low-budget travelling places are in Asia and AirAsia has many routes within Asia. Adding the platform to start focus on frequency is also recommended since AirAsia has more focused on reach before. So it might be better if AirAsia tries to change or add its strategy to be focusing on frequency, because the more people are exposed to an advertisement or idea, the easier for them to accept and agree with it.
MARKETING & NICHE
Price
This is the most important value that AirAsia offers as a low-cost airline. The pricing strategies used are charm pricing and anchor pricing. Charm pricing used to create an illusion that the price is not over a certain amount and not under a certain amount. AirAsia commonly uses nine (9) or five (5) as the last digit of the price because they are associated with discounted prices. Zero (0) is rarely used, but AirAsia still does sometimes. The second one is Anchor pricing, which will make the consumers think the lowest price possible. The tactic’s used by AirAsia and many other companies is putting the “All Fare From” or “Starts from” words, with a really small alphabets until some people do not realize those words. Definitely, with Terms and Conditions apply.
Promotion
Promotion is the second most important value AirAsia offers in its marketing strategy. AirAsia is trying to build consumers’ demand for flying with AirAsia. The promotion strategies used are quantitative promotion, qualitative promotion, and accessibility promotion. For the quantitative, AirAsia usually provides flight tickets, accommodation, and sometimes even services in a single package, or gives a “Buy One Free One” quantitative promotion. AirAsia also uses qualitative promotion ensuring that flights cancellation and delay more than two hours will be compensated to the passengers as much as RM 200. This is to convince the consumer that AirAsia is reliable and always be on time. Definitely, Terms and Conditions apply for this qualitative promotion and actually the compensation is only given if the passengers have purchased travel insurance. For the accessibility promotion, AirAsia uses its webpage to minimize the old style tickets purchase in travel agent or in the airline stores. By providing a webpage, consumers can purchase the flight tickets online including purchasing the baggage, insurance, foods, entertainment and accommodation at the destination place. Payment can be made by Visa / Master Card/ PayPal / other online payment methods and the tickets and receipt will directly be sent to consumers’ email. Not juts booking a flight or service, passengers can do their own online check-in online too.
Place
Place is not the strong value that AirAsia uses to highlight the availability of their service because the people who usually want to check the promotion or buy AirAsia ticket will directly access the webpage. Of course, rumble is not used because AirAsia is not selling a physical product. Reach and reputation are applied by AirAsia booth fair in the shopping malls because shopping malls can reach a lot of potential consumers and create the perception that a lot of people are visiting the booth.
Product
Since AirAsia is offering service, the product of AirAsia is only the merchandise - which will not be discussed on this analysis, physical ticket and boarding pass. According to DeBono Six Thinking Hats process, AirAsia’s tickets and boarding pass are clear enough stating the branding information or the facts, such as the brand name, logo, brand colors, and brand elements with a consistent brand font types. AirAsia does not put its tagline now everyone can fly and prefers to focus on colors used on the physical ticket and boarding pass, which are red and black with white background. In color psychology; red means energy, passion, action, strength and excitement; while black means authority, power and control; and white is calming as it creates simplicity, organization and efficiency out of chaos. It clears the way forward. AirAsia also puts its creativity by adding the overlapping circular shapes on its mediums that represents unity, wholeness, infinity and number one.
The process to purchase AirAsia is clear enough as everyone uses Internet and they already have an idea how to book tickets online and how to fly with AirAsia. While if some people do not, AirAsia provides the online and printed graphic information so the first timer passengers will not miss their flight or get lost.
The missing point here is the feeling. Since the application of DeBono six hats is not only about showing the product but it’s about creating a perception of AirAsia service towards the consumer, AirAsia is still being mainstream on its boarding pass creativity. The feeling is not there because all of the airlines use the same concept of their tickets and boarding pass. Yes it is true that there must be aviation rules regarding the physical tickets and boarding pass, but to improve them to make it different from other airlines is still possible to strengthen the consumers’ impression.
People
Since AirAsia is an airline company offering service, people act as an important role in this business to portray that AirAsia is from the people and for the people, to communicate with the consumers, and to earn the consumers’ trust. The first category is the consumers. Consumers are the priority. AirAsia specializes its consumers by offering them AirAsia membership. AirAsia member will get extra benefits such as adding more than 10 people during the flight reservation, be able to do the easy payment online, have an easier flight reservation, getting AirAsia newsletter, be able to check the refund status and many more.
While in another case, there are people who representing the AirAsia itself, which are the employees, pilots, flight attendants, managers and many more. The most obvious one is the flight attendant because their job is to ensure the safety and the comfort of passengers on board. Lastly, the culture of AirAsia, which are “Caring, Passionate, Full of Integrity, Fun, Safety, Conscious and Hard Working”. Those are the keywords that stated as AirAsia’s cultures.
Physical Evidence
As explained before, the physical environment to enable the potential consumers see the promotion and ask the company people directly is through roadshows, such as AirAsia Travel Fair in the shopping malls. Absolutely, AirAsia has not let the its consumers to experience flying with AirAsia at the roadshow, but yet it is possible and it will be interesting and attractive if there is any. Based on the basic human sense, the sense is applied during the roadshow. The audience is directly exposed to brand image, brand colors and the company people. There is no smell, taste and touch because AirAsia doesn’t sell a food or solid product, unless if we are talking about AirAsia merchandise that is shown during travel fair, such as the prototype of the aircrafts, that strengthen the sense and the touch that consumers can experience. While hear is only about the crowd, the MC (if there is any) and the promoters during the roadshow.
Process
AirAsia has explained the process of its cabin crew, which is the AirAsia All Stars, how are they chosen and trained, and the important values that all airlines should concern, safety. In a sum, AirAsia stated that, “We are committed to giving equal employment opportunities to everyone; and this we do so by creating an environment free from any discrimination; whether it is due to skin color, religion, race, gender, sexual orientation, political orientation, nationality, age, marital status, ancestry, socioeconomic status and physical disabilities. All of the people work in the safest possible manner and they use a comprehensive Safety Management System that details how they manage and handle safety. The senior management provides strategy and leadership, but all of them are responsible in producing safe operations and working environment.” This connection-based process is stated on the AirAsia webpage explaining the company values. On this copy, there is no detail about the aircraft since it is more focusing on the process to get the people, the training, and the benefit of the training that strengthens three AirAsia main values: safety, cost efficiency, and collaboration & innovation. This process is shown on AirAsia in-flight magazine, 3Sixty Degrees and on its webpage.
Overall, in my opinion, the most important things to improve for the marketing are the price, people, physical evidence and process. For the price, yes it is true the AirAsia advertisement has shown many cheap flight fares, such as the (from) RM 1 flight. But then people were disappointed after they checked on the website that it was actually more than RM 50 after its added with the tax and everything (source: comment section on AirAsia webpage by a consumer). So it is better if AirAsia reduce its manipulative price on the advertisement or at least, put the price that is close to the actual price. For the people strategy, the customer service can still be improved because again, there are still a lot of complains from the consumers about the bad service quality from the AirAsia employees, especially the cabin crew. A standardize and daily or weekly evaluation for each cabin crew is necessary since the first impression of an airline is judged by its cabin crew attitudes. While in another side, the physical evidence is not necessary but it will be better if there is. For the example, the smell and taste are still possible to happen during the roadshow or any AirAsia campaign by having its own fragrance that will be using in any campaign and in the plane. The fragrance should be calming and not be too strong, for the example, the lemon, lavender smell or fabric smell that are believed will psychologically will make people be calmer and happier. Last but not least, the process. AirAsia has already had its own process story, but yet not many people know about it, and although they do, they do not know many. The example is the AirAsia All Star. AirAsia can make a compilation of testimonies shown on its advertisements or its campaign. This can be the actual evidence or process that most probably will be accepted by the community and the potential consumers.
BRANDING & NAME
AirAsia has a pretty strong branding as the concept that is accepted and understood by its consumers. AirAsia has the simple, yet right concept story with the right platform and recognizable logo, and it links to everyone.
Brand Story
“The airline was established by a Malaysian conglomerate in 1993 and commenced operations in 1996. In December 2001, with the airline heavily in debt, AirAsia was purchased by Tony Fernandes of Tune Air Sdn. Bhd. for the price of RM1. As part of the purchase, Tony also took up the RM40million debt. Under the leadership of Tony Fernandes, the airline was flying high in 2002 and launched its new route that year. In 2003, a second hub was opened in Senai International Airport, Johor Bahru, as well as the airline’s maiden international flight to Bangkok. After that the only place AirAsia was heading for is up, as the Thai and Indonesian subsidiaries were set up as well as the commencement of flights to Indonesia, Macau, China, Philippines, Vietnam and Cambodia in 2005. AirAsia now flies to all ASEAN countries, a great portion of Asian countries that include India, Iran, Sri Lanka and Bangladesh; as well as to the United Kingdom, France, Japan, Korea and Australia via AirAsiaX. In 2011, we are setting up another AirAsia hub in the Philippines and are well on the way in setting up other similar operations elsewhere in the region soon after.”
“Aviation has always been an exciting business. Travel has always been a joy, and increasingly for many, a necessity. And doing it in heavier-than-air metallic technological marvels have always fascinated and drawn people. And now, with brilliant execution of a unique business model, AirAsia is able to make and fulfill the promise, whether it is the standard destinations or the most inaccessible ones, AirAsia makes flying affordable, convenient, and fun for everyone. Now everyone can fly!”
AirAsia does not have a specific character in its brand story, but the story does explain the culture and the values of AirAsia. Adding the track record and longevity makes AirAsia branding story sounds more experienced.
Brand Strategy
AirAsia states itself as the Asia’s largest low fare airline, pioneered low cost air travel in Asia by operating more than 150 aircrafts in Malaysia, Thailand, Indonesia, Philippines and Japan with the world’s lowest unit cost, and achieve an aircraft turnaround time of an incredible 25 minutes. The addition point that AirAsia has its crew productivity level that is higher that the competitors’ and the aircraft utilization rate that is the envy of the industry. AirAsia is also the largest single customer of the Airbus A320 and has been fully operating with A320s. This is the strategy story used to situate its company in the market and the competitors.
Consistency
AirAsia is being consistent by; using the same tagline “now everyone can fly” in every publication medium; using the same colors, which are red, black and white; using the same visuals, mostly is the overlapping circular shapes; using the customized fonts by Rob Clark for its logo; using the same official font types for the websites and any other medium, Arial Regular and Arial Bold; and using the same aesthetics. The brand manual with the proper logo placement, proper colors, proper size and proper alignments on the required proper platforms is available on its webpage so a consistent brand identity is made.
My opinion and recommendation for the branding is the consistency. People nowadays are visual oriented, so they are more interested and remembered in visuals instead of texts. Together with the creativity point in DeBono Six Hats marketing, AirAsia can improve its brand consistency by adding more visuals or shapes or elements that will be exposed repeatedly and will create the thought that the element is the part of AirAsia. For the example, the overlapping circle is one of the good ideas, and I believe that AirAsia is possible to produce more than that. These new elements can be used in any publicity medium instead of using the stewardess all the time, because not all of the consumers are women and not all of them are interested in seeing pretty stewardesses with their short skirts, while based on a few researches, everyone are into visuals, shapes and elements because it creates imagination that allow the consumers to think based on their own interpretation.
REFERENCES
AirAsia, (2007). Annual Corporate Report B 2007.
AirAsia, (2007). Annual Report Corporate 2007.
AirAsia, (2011). Annual Report Corporate 2011.
AirAsia, (n.d.). First Touch.
AirAsia, (n.d.). Jump Start Malaysia.
Asia Aviation Public Company Limited, (n.d.). Corporate Social Responsibility.
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