Target Market for Virgin America Airline - Essay Example

Target Market for Virgin America Airline: The purpose of this paper is to identify what Virgin America’s target market is. The paper will first examine how the Virgin Atlantic marketing position has affected the brand image. Next the target market will be defined and then justified based on geographic, demographic and psychographic lines. Finally this paper will seek to justify whether or not the defined target market is appropriate for Virgin America’s product offering. Brand Image: The target market for Virgin America is not as narrow as one may first assume. There is obviously going to be brand recognition of Virgin America through its sister company Virgin Atlantic. According to Aufreiter et al. of the McKinsey quarterly Virgin Atlantic constantly tries to reinforce the brand slogan ‘doing things differently’ by offering sit down bar service, flat bed seats, in-flight massage service ( 2003). This image may be firmly entrenched in the image of potential customers of Virgin America. According to Mutzabaugh of USA today (2007), Virgin America positions itself as an airline that is something between the traditional airline carriers and a discount airline, and although the service is less lavish than the international service it still promotes itself as having the best customer service in the business. What this paints a picture of is an airline that has significantly lower fares than most traditional airlines while still being able to offer excellent service. Furthermore according to the Virgin America website, the company also offers a first class service on its flights which indicates that the company is prepared to segment the market for both people seeking low cost flights and people demanding additional service The question that remains are who would be the main consumers of the product offering of Virgin America and weather this market is sufficient in size. The target market for this paper is defined as males and females who live in close enough proximity to the seven destinations that Virgin America services and are automobile owners. Furthermore the target market encompasses people who are employed and should have enough disposable income and be 20+ to account for the need to take a holiday. As the company positions itself as a low cost air carrier the target also includes people who are thrifty but also demand quality. Geographics The most obvious example of what the target market for Virgin America would be are people that live within a reasonable geographic proximity to the airports that are serviced by the company. According to the Virgin America website, the airline departs from and flies to only seven American cities (Las Vegas, Los Angeles, New York, San Diego, San Francisco, Seattle and Washington DC.) and the company uses San Francisco as its hub and Los Angeles as a focus city. So one could assume that the target market would encompass both potential customers that either live in close proximity to the airports that Virgin America services and those who would be interested in visiting one of the other cities that the airline services. There is the possibility that customers would be willing to take an initial flight in order to connect with an airport to and use Virgin America to fly to a final destination. However this action would probably require two different bookings with two separate airlines and may negate the cost savings. It is worth noting that the target market should not be segregated on a state by state basis. For example people living in Reno, Nevada would more likely use the San Francisco hub as this airport is in much closer geographic proximity than the airport in Las Vegas, Nevada. For the most part the target should exclude people who do not live close enough to the seven airports such as people living in Miami, because the nearest airport that Virgin America flies out of would probably be Washington, DC. Demographics: Income, employment status, age, mobility and sex are the factors that will be used to describe the demographics of Virgin America. As for income one could assume that the company is prepared to meet the needs of both higher income people (Who demand additional service) and middle income passengers (Whose focus would likely be demanding a lower price) simply by nature of the fact that they offer a first class and coach service.Even though people purchase economy class tickets they are still going to need a degree of disposable income for use at their destination. The target market in regards to income could be defined as people with a moderate to high degree of disposable income. When examining employment status it is important to consider how Virgin America segments its market. As the first class option would generally be directed at people with higher incomes one could conclude that this segment would be directed towards business professionals with higher disposable income. However since the company offers a low fare option as well, it is safe to assume that the company has a product offering for varied groups such as people employed in lower paying positions (Possibly even students). As such the target market should be employed people. It is fair to say that 20+ would be the target age group for Virgin America. As the company offers a low fare cabin to top holiday destinations such as Las Vegas and Los Angeles this option may be directed to younger holiday makers, but the presence of the first class cabins implies that the company also targets customers who are probably older. In terms of mobility we must assume that the target market would be people who are in close enough geographic proximity to reach the airports serviced by Virgin America by automobile. We can assume that automobile owners could be considered a large portion of the target market. As the market for air travel applies to both genders the target market will encompass both males and females. Psychographics Social class, lifestyle and values will all be used to define the target market for Virgin America. When examining social class one must consider that according to Pae (2008) of the LA Times, the company offers fares out of LAX for as little as $44. Much like examining the income target income level one must consider not only the price of the ticket but the disposable income for use at the final destination we can assume that the target market is customers who are at least a lower middle class through to upper class (For first class tickets). Furthermore since the main destinations for the company are generally speaking tourist destinations, one could assume that the target market is people who have a busy lifestyle and enjoy taking holidays. In regards to values, it is likely that potential customers are thrifty for wanting to save money on airfares but also demand a high level of customer service. Conclusion The target consumers can be male or female, most likely 20+, living in close geographic proximity to the seven airports that Virgin America services, with an income large enough to justify a holiday but thrifty nonetheless. The reason why this target market is a good fit to the product offering of Virgin America is because of the following. Virgin America only services seven airports and as such the consumers should logically live close enough to the airports to gain access to the service. On order to justify taking a flight the customers should have disposable income for use at the final destination not just the cost of the flight and as such the target market should be employed. This target market would logically represent a huge portion of the American population. As a final note, people other than the target market of course are going to use Virgin Atlantic for their travel needs however it seems likely that the aforementioned target consumers would be better fit for the product offering. References: Aufreiter, N., Elzinga, D.,Gordon, J. (Noc, 2003) Better Branding, The McKinsey Quarterly [online] available at http://www.mckinseyquarterly.com/Better_branding_1349 Mutzabaugh, B. (Aug, 2007) Virgin America Takes Off, USA Today [online] available at http://www.usatoday.com/money/industries/travel/2007-08-07-virgin-america_N.htm Virgin America Corporate Website [online] available at http://www.virginamerica.com/va/home.do Pae, P (March, 2008) Virgin America Provokes Fare Wars at LAX [online] available at http://articles.latimes.com/2008/mar/03/business/fi-virginamerica3 Read More