MARKETING FOR BRITISH AIRWAYS

Marketing for British Airways

Marketing for British Airways

Ans: 1. Overview of British Airways

Ans: British Airways has a worldwide network, is one of the major airlines around the world and is part of the One World Alliance. According to IATA statistics, British Airways was ranked eighth in the provision of freight tonne-kilometers in 1998. The company is the main centre of Heathrow, where most of its activity is concentrated. In terms of air cargo in the United Kingdom, Heathrow handles 75% of British Airways rose tons is the next largest airport Gatwick (18%) and Stansted (4%).

Together, the three major airports in London, handle upto 97% of British Airways flights and cargo shipments. These figures include the transfer is estimated at around 17% of total tonnes carried. Belly full of wet leased the loading capacity of freight on the main roads of the Far East, Africa and Israel. British Airways has undertaken substantial investments in facilities for loading with the creation of British Airways World Cargo Centre and refrigerated storage at Heathrow.

“British Airways' share price is now UK£3.49, having fallen dramatically from its £7.60 high in 1997 (Ann, 2001).

The company has been embarking on cost cutting since 1996, but has lately upped the ante. BA's ousted chief Bob Ayling's commencement of cost cuts initiated the strike of 1996, which alienated the public and led to further needs to cut capacity. The Sunday Times of 12/3/00 suggested that “had Ayling not cut BA's costs the airline would be having even greater problems”.

The most recent results released in February showed a third quarter pre-tax loss of UK£ 60 million. This was pretty much as expected with the airline leaking cash as it restructures. The plan is to focus on smaller more economic planes carrying premier fare paying customers. As well as business traveller class, the company also recently announced a new 'world traveller plus' class for the cost conscious business traveller. New seats that open out as 'beds' are part of the move to attract the high paying target market. The niche expansion is at the expense of losing customers at the cheap end. BA expects to cut capacity by 12% over three years and reduce 6,500 jobs” (Ann, 2001; 25).

Air transport is a global industry and as such every airline is a likely challenger for every other. It is contrary to expectation that any airline will be able to contest on a large scale without being associated to other carriers. Traffic feed is the industry's lifeblood and stand-alone carriers will be labored to carry low-revenue point-to-point traffic when front with airlines able to offer manifold route alliances.

The air transport industry is an energetic, fast-paced business. The boundless capital sums entangled in buying and leasing aircraft, staffing them maintaining them, fuelling and navigating them, mean that airlines steadily have to search for new, improved and more effective ways of flying them to more places at higher load factors. The search for extended scope without fundamentally increasing capital costs have driven airlines ...