Presented By: Levan Chkhaidze George Khutsishvili Ana Khmiadashvili George Kuparadze Tako Kiknadze

1. Product Feature Matrix

American Airlines

Shipping companies

British Airways IrishAirline

Ryanair

Feature Technology Charter flights

Most extensive airline

Maintenance service and engineer training

Awareness (Largest aircraft leasing company)

F1 Low cost carriers

Own passenger and ground service

Hotel business

Discount fares ($ 99)

F2 Hub-and-spoke route

Hired contractors

No restrictions for tickets

F3 Computerized reservation

Tickets over telephone, retail shops

Focus on service quality

F4 Independent travel agents

Spectrum of ticket prices

3.Aggregate Market Factors For Our Industry

As we know aggregate market factors impact the potential market attractiveness.

There are six of them:

1. Category size2. Market growth3. PLC4. Sales Cyclicity5. Seasonality6. Profits

Category Size

Category size is an important determinant of the likelihood that a product will generate revenues to support a given investment.

In our example Ryanair category size, was small because of little market potential and due to the BA existence thus it does not provide huge opportunities for company. Also If we take into consideration the whole Great Britain air business industry than it becomes unattractive for such companies like Ryanair because of too tight competition and limited recourses.

Market Growth As we know market growth is a

key market factor advocated by various planning models.

In our example, The most important thing was not a market growth itself but rather brothers future intentions about expansion. May be Ryanair was not in ideal situation but it is clear that demand on Air service in increasing from day to day basis, thus it is providing great opportunities for the company to maximally exploit it’s capabilities and earn revenue.

Product Life Cycle ( PLC)

Product life cycle is a clear indicator about at what stage companies product or services are.

Ryanair is of course at introductory phase, when category size as well as portion of the market are small. Sales volume is not very high either. Growth rate is also weak and market attractiveness is not desirable, but everything starts with something and it need development to reach the peak and generate revenues.

Sales Cyclicity

Many industries experience substantial variations in demand due to peaks and valleys of GDP and other economic dimensions. Air business is not an expansion.

Therefore Sales Cyclicity will undoubtedly influence and effect such a little company as Ryanair. As we all know during some economic recessions price of Air fuel is increasing in a rapid change which is harming the whole industry and Ryanair won’t be an exception. By this aspect Industry attractiveness is low from the point of Ryanair.

Seasonality Seasonality refers to some trends

which occurs between some cyclicity periods.

It is difficult to say something about Air business Seasonality because demand is always but little bit different according to seasons. There was not much information about Ryanair’s seasonal sales and therefore it is difficult to draw up some conclusions about it. But In our opinion it would be great if company will offer some extra motivating factors to customers during peak seasons and time periods, it will enhance the recognition and loyalty.

Profits

Profits are the very thing for which every particular company is striving to achieve.

At first glance profits for Ryanair won’t be as high as for example for BA, but attentive implementation of correct marketing strategy and correct industry analysis may give such opportunity to brothers in the nearest future.

4. Potential Of New Entrants

Answer can be divided in two parts; before and after 1978.

Airline industry was not really attractive for entrance. And there were rational reasons for this: government totally controlled this business, and owners were not free to run their own business in a way that they wished. Market was government-mandated monopolies or near monopolies, and entry barrier was very high.

Particularly there was no competition. Also fuel and oil takes 19 % share in expenses, which very high, and in that period OPEC raised the price of jet fuel, and the ensuing recession cut demand for air travel. And airlines had very hard time because of heavily unionized staffs and high fixed costs. So potential for new entrants was very low.

After: But industry whole situation changed after 1978. When U.S congress approved the deregulation of the domestic U.S airline industry, pricing, route scheduling, entry, and exit were freed up dramatically. As case shows 22 new low cost carriers emerged in the market. But most of new airlines failed however. This influenced European airline market very much, they also referred to deregulation and abolished pooling arrangements, price fixing, and government subsidies. The market was intended for free movement of goods, persons, and services. So all these changes made this market attractive to enter.

Thanks For Attention!!!