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Independent Study: Marketing strategies of low cost airline in Japan - Skymark Airline - Essay Example

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Independent Study: Marketing strategies of low cost airline in Japan - Skymark Airline

The airline has continually reported upward profits with a year to year increase in operating profits (Banfe, 2002). The year 2011 was a busy operational year for Skymark. Earlier in the year, Skymarks placed a massive order for 6 A380s as one of its determined growth plans, getting away from the small domestic quasi LCC model to an international carrier long haul. Skymark Airline has a unique strategy of expansion as it operates two distinct models. The marketing strategy of Skymark seeks to ensure that the services of international Long haul utilize configured A380 equipment in a low density configuration seat. The marketing strategies will also ensure that short haul and domestic services continue to operate with no frills service and economic B737 aircraft. In addition, the marketing strategies will also ensure domestic expansion of the carrier (Beardwell and Holden, 2003). The Skymark Airlines was established back in 1996. It is headquartered in Tokyo, Japan. The airline operates flights to Kobe, Fukuoka, Okinawa, and Sapporo from Tokyo. Skymark serves about 3 million customers with 12 aircrafts per year. Skymark Airlines accounts for about 5 percent of domestic Japanese seats; this limits the feed opportunities (Griffin, 2004). The domestic carrier particular has no partnerships of its own in spite of the bigger Japan Airlines having ventures jointly across the Europe and Pacific delivering larger customer pool and far greater traffic opportunities. Skymark Airlines intends to have intense A380 with 394 seats in all premium business and economy configuration and aims to have approximate load factor of 60 percent. The marketing strategies require that tickets be sold to yield high profits. The Skymark Airline offers services of passenger transport in Japan (Handy, 2003). A380 operators seat configurations Airline First A380 delivery Total seats First Business Premium Economy Economy Singapore Airlines Oct-2007 409 12 86   311 471 12 60   399 Emirates Jul-2008 489 14 76   399 517 14 76   427 Korean Air Jun-2011 407 12 94   301 Lufthansa May-2009 526 8 98   420 Qantas Sep-2008 450 14 72 32 332 Air France Oct-2009 516 9 80 38 389 538 9 80   449 China Southern Oct-2011 506 8 70   428 Malaysia Airlines 2Q2012* 508 8 54   420 Thai Airways Sep-2012 507 12 60   435 Skymark Airlines 2014* 394  0 114 280   Source: CAPA – Centre for Aviation & airline reports Scheduled delivery Marketing strategies of Skymark Airline Skymark Airline is one of the major low cost airlines in Japan. Just like the Air Do, the biggest problem of Skymark is trying to engage competitively in price wars with the Big 3 airlines in Japan: All Nippon Airways, Japan Airline, and Japan Air System (Virgin Atlantic Airways 2007). Skymark Airline has chosen a low cost density of 304 seat configurations, a split between 114 business class seats and 280 premium economies. This is one of the least intense configuration operators can manage. The products of Skymark consist of angled flat lie seats on the upper deck in business class (Horovitz and Panak, 2007). Although Japanese carriers are slow to catch up in updating their cabin to peers, angled lie flat is falling globally out of favor. The premium economy of Skymark Airlines consists of a fixed back shell seats reportedly. This tends to receive pessimism in the feedback on long haul flights (De Pommes, 2005). If the marketing ...Show more

Summary

Marketing strategies of low cost airline in Japan - Skymark Airline Executive summary Skymark Airline is the third largest domestic carrier in Japan. The low cost airline is switching its first A380 destination to New York from London in order to improve its profitability in an atmosphere of economic uncertainty in the UK showing no relenting signs (British Airways 2006)…
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Independent Study: Marketing strategies of low cost airline in Japan - Skymark Airline essay example
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