1.

EXECUTIVE SUMMARY AirAsia was established with the dream of making flying possible for everyone. Since 2001, it has swiftly broken travel norms around the globe, risen to become the worlds best and continues to grow faster than the economy. Although AirAsia has enjoyed high profitability and continued growth, they also have to face lots of challenges due to the entry of new competitors and other factors. The purpose of this report is to develop a marketing report for AirAsia. The marketing plan consists of introduction; focusing on the background of company, vision and mission statement, objectives, SWOT analysis, issues, strategies, evaluation and control process. Specifically, this report addresses the challenges currently facing the industry along with the strategic responses of the airlines and some

recommendations of ways to address theses current challenges. Recommendations may include the marketing mix that will be used to overcome the challenges or issues faced by AirAsia.

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INTRODUCTION AirAsia Berhad was established in 1993. AirAsia began its operations on 18th November 1996. It was founded by the government-owned conglomerate, DRBHICOM. Unfortunately, AirAsia faced financial problems at the beginning of operations. On 2nd December 2001, this heavily-indebted airline was brought by Tony Pernandez, the owner of Tune Air Sdn. Bhd. He was the former executive of Time Warner. Fernandez successfully turned out the company around. AirAsia has experienced a sensational financial growth from RM 86 million debts (March 2000) to RM 161 million credit (September 2004) as shown in the company financial report. AirAsia started its business journey as a low-cost air carrier in Malaysia, undercutting former monopoly operator Malaysia Airlines (MAS) with promotional fares as low as RM 1.00. AirAsia currently operates in an oligopoly market structure, together with their competitors such as MAS, Firefly, JetAirways, Malindo Air and others. The main hub of AirAsia is Kuala Lumpur International Airport (KLIA) and they also have three (3) secondary hubs; Kota Kinabalu International Airport (KKIA), Penang International Airport and Kuching International Airport. The parent company of AirAsia is Tune Group and they owned six (6) subsidiaries all over the world; AirAsia X, Thai AirAsia, Indonesia AirAsia, AirAsia Philippines, AirAsia Japan and AirAsia India. The company is famous with the slogan Now Everyone Can Fly. In the year 2007, AirAsia achieved its title as The World Lowest Cost Airline and was also one of the worlds most profitable airlines. The achievement was based on the principle to stay sociable, honest and transparent to deliver timely interactions and to listen to our consumers. AirAsia social media is also known to be successful in building strong vital awareness towards Sales Promotion & New Route Launches, Notably, AirAsia Free Seats, The Korean Secret Box Challenge, Moshi-Moshi Japan, Paris Love Postcards and etc. Between 2002 and 2009, AirAsia had expanded from two (2) aircrafts and 200,000 passenger journeys to 79 aircrafts and 11.8 million passengers. AirAsia and its subsidiaries are flying to 112 prospective destinations all over the world, as of June 2013. As of May 2013, the total of AirAsia fleet (excluding AirAsia X) was 126. In 2012, AirAsia gained RM 5.0 billion (USD 1.62 billion) of revenue and RM 1.88 billion (USD 0.61 billion) of net income. 2

3.0

VISION STATEMENT To be the largest low cost airline in Asia and serving the 3 billion people who are currently underserved with poor connectivity and high fares.

3.1

MISSION STATEMENT To be the best company to work whereby employees are treated as part of a big family Created a globally recognized ASEAN brand To attain the lowest cost so that everyone can fly with AirAsia Maintain the highest quality product, embracing technology to reduce cost and enhance service levels

3.2

KEY STRATEGIES 1. Safety First: Partnering with the worlds most renowned maintenance providers and complying with the with world airline operations.

2. High Aircraft Utilization: Implementing the regions fastest turnaround time at only 25 minutes, assuring lower costs and higher productivity. 3. Low Fare, No Frills: Providing guests with the choice of customizing services without compromising on quality and services. 4. Streamline Operations: Making sure that processes are as simple as possible.

5. Lean Distribution System: Offering a wide and innovative range of distribution channels to make booking and travelling easier. 6. Point to Point Network: Applying the point-to-point network keeps operations simple and costs low. 3

4.0

EXTERNAL ANALYSIS

4.1

PEST ANALYSIS Political Factor Malaysia Airlines is 69% owned by the government and has been protected on the routes that are offered (BBC, 2006). Incheon, Singapore and Sydney routes are protected for Malaysia Airlines. Malaysian Airlines will convert its low fare airlines, Firefly to a full board airline to protect AirAsia. (BBC, 2011) Economical Factor Appendix 2 shows the jet fuel price per barrel over the last 5 years, the charts most noticeable feature will be the price fluctuation. The charts shows a dramatic price drop in November 2008 and an inclining price hike ever since. Even though Appendix 3 shows a stable fuel price over the last six months, the fuel price remains unpredictable but the new Airbus 320 Neo will be able to save 15 % fuel with additional 950 Kilometres or to transport 2 tonnes of additional weight (Airbus, 2011). High taxes, visa restrictions and baggage handling charges are increasing for Europe and India Destinations (BBC, 2012). Annual disposable income of Malaysia has seen great improvements in year 2010 and 2011 as seen in Appendix 4 Social Factor Malaysia GDP per capita in Appendix 5 shows a positive growth in 10 years with a slight decline in year 2010. An Average Malaysian tourist spends about USD 4,700 during their stay and is amongst the highest repeat visitor to Australia. Malaysian tourists expenditure to New South Wales from Malaysia grossed at USD 142 million, which is a 75% increase from 2010 (Travel Weekly Asia, 2012). Technological Factor Airbus 320 Neo will incorporate new Leap-X engine from CFM International and larger wing tips called sharklets. This new fleets will deliver fuel savings of 15% and range capability of 500 nautical miles. (Airbus, 2011)

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MICHAEL PORTERS FIVE COMPETITIVE FORCES Bargaining Power of Suppliers The bargaining power of suppliers in the airlines is high as the aviation industry faces a duopoly hence the price is determined by Airbus and Boeing. Bargaining Power of Buyers There is no cost of switching for the customers to use another services or product. The access of internet connectivity has made it very easy for customers to compare prices of flight before making changes. For a full board airline, customers will be more demanding but willing to pay more in contrary to the bigger market demands for low cost airlines, the customers are less demanding but thrifty. Threat of Substitute Product or Services Substitute for the products offered by AirAsia will be trains, buses and cruise, however due to the geographical factor trains buses and cruises are not viable. For business travellers telecommunication and video conferencing is also seen as a substitute here. Cisco Webex offers unlimited meeting as low as USD 19 per month (Cisco, 2012). The threat of substitute here is moderate. Threat of New Entrants When it comes to the Airlines industry in Malaysia, threat of new entrant is very low. This is due to high operating cost, government regulation and legislation. Moreover, AirAsias brand awareness and market leadership will put AirAsia ahead of the competition. Even though there is freedom of entry and exit the airlines industry has seen many flight operator went out of business, namely AdamAir, Cosmic Air, Impulse Airlines and Oasis Hong Kong. (Asia Times, 2007) Rivalry among Existing Competitors AirAsias main rival was Malaysian Airlines and its low cost airlines Firefly. But sinc e August 2011 agreement between AirAsia and Malaysia Airlines, firefly will no longer be a rival to AirAsia as Firefly will be a full board Airlines and Malaysian Airlines will focus on its strength and will not directly compete with AirAsia.

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INTERNAL ANALYSIS

5.1

SWOT ANALYSIS STRENGHTS

Low Cost It is suitable with their tagline Everyone can fly mean to giving opportunity to all people to flight with the lowest possible fare and making them can flight even they only have less money.

Airasia Is The Lowest Cost Leader In Asia With the help of AirAsia Academy, AirAsia has successfully created a low cost airlines mentality among their workforce. The workforce is very flexible and high committed and very critical in making AirAsia the lowest cost airlines in Asia.

High Technologies

The excellent utilization of IT have directly contributed to their promotional activities (email alert and desktop widget which was jointly develop with Microsoft for new promotion), brand building exercise (with over 3 million hits per month and the most widely surfed booking engine in the world) as well keep the cost low by enabling direct purchase of ticket by consumer thus saving on airlines agent fees.

Good Brand Image And Performance

AirAsia already created a unique image. AirAsia is using all kind of medium that can promote and boost their name to the customer. Besides that normal print media advertising and promotions, AirAsia feature a friendly image to the industry by sharing their latest information and what happen in airline industry to the media. AirAsia capitalized there promotion strategy by collaborate with other service provider that link to they such as hotel, car rental firms, and other local firms. AirAsia is not only building their brand name in Malaysia but also in the Asia Pacific. They are able to get into Thailand and Indonesia market and established their name there with Thai AirAsia and Indonesia AirAsia. Other than that, AirAsia also used to be one of the sponsors for Manchester United football teams and now, they are sponsoring Queen Park Rangers football teams. Moreover, AirAsia also sponsors one of the team in Formula One. It will further boost their brand name beyond this region.

Strong Management Team & Strong Links With Government And Airlines Industry Leader

This is partly contributed by the diverse background of the executive management team that consist of industry expert and ex-top government officials. Aireen Omar is the CEO of Air Asia Berhad. Before joining Air Asia, she already holds an important position in finance and banking industry. With her experience in the corporate world before will help her to bring Air Asia to the next level. Moreover, AirAsia had strong relationship with Thailand because 50% stake in Thai AirAsia and its helps AirAsia to penetrate and capture the market in Thailand. AirAsia also has been working with Airbus and manages to purchase aircraft with more fuel efficient with the big discount.

WEAKNESSES Services

AirAsia receive a lot complaint from customer on their service. Examples of complaint are around flight delays, being charged for a lot of things and not able to change flight or get a refund if customer could not make it.Other than that, the waiting period between check in and depart is too long. It takes around 2 hours for international departure Good customer service and management is critical especially when competition is getting intense.

No Maintenance Facilities

Air Asia does not have its own maintenance, repair and overhaul (MRO) facility. It may be a good strategy when they first started with only Malaysia as the hub and few planes to maintain. But now, with few hubs (Malaysia, Thailand and Indonesia) and over 100 planes currently owned and about another 100 planes to be received in the next few years, AirAsia have to ensure proper and continuous maintenance of the planes which will also help to keep the overall costs low. It is a competitive disadvantage not to have its own MRO facility. No Frills

They only provide the transportations services. The customer has to make preorder for their heavy meal such as nasi lemak during booking their tickets. If not, they only can buy the chip and beverages.

Government Interference And Regulation On Airport Deals

There are requirement that AirAsia must follow and different countries have different requirements. AirAsia need to cope with the rules and requirement stated by each country and it going to be complicated because most of the AirAsia flight landing at secondary airport.

Non-Central Location Of Secondary Airports

Because of low-cost strategy, AirAsia chooses to land at secondary airports. The demand for that destination is usually less than the primary airport. OPPORTUNITIES

Ongoing Industry Consolidation

Ongoing industry consolidation has opened up prospects for new routes & airport deals. AirAsia is trying to get as much new route as they can to stay connected to their customer. So, it will open many opportunities to AirAsia and enlarge their target market. Other than that, with more airport deal, it will give AirAsia more opportunities to promote their service and enhancing awareness to their brand.

High Fuel Prices

With the increases to the fuel price, it will help to eliminate other competitors that cannot effort with that increases. Therefore, the number of competitors will be less and it makes it hard for other new competitor to enter the industry. It wills gives AirAsia more equity in the market and stabilize their market share. Asias middle class growth

Low-cost airlines are anticipated to have greater potential in Asia as there are many Asian cities with a population above one million people each as well as a rising middle class population. This growth of middle class in Asia provides a huge market potential for AirAsia to grow. However, as the market is becoming larger, more airlines or new comers would like to get a piece of the action. For example, Budget airlines, it is estimated, will capture at least 25% of Asias air travel market within next 10 years and a lot of the will be new, not diverted, traffic. Therefore, AirAsia will face more competitions at the same time. Besides the low-cost airlines, AirAsia still needs to compete with the conventional carriers. Although extra passengers of the low cost airlines will be 9

coming from the new demand to be created by the low fares, the growth may not be entirely stolen from big flag carriers.

THREATS

Full Service Airlines Imitate Low-Cost Strategy

Full service airlines start to find way to cut-down their operational cost in order for them to be able to compete in this industry. Other competitors saw the success of low-cost strategy and try to use this strategy too. It will give more competition in the future. Entrants Of Other Lccs

There are other LCCs entering the market and slowly try to get market share. For example, Malindo Air. It will make customer to have more choice and create the price competition and the pressure to find their own competitive edge. High Fuel Price Decrease Their Revenue

With the increases of fuel price, the yield for AirAsia will start to decrease. It can be a serious situation because AirAsia needs to maintain their low price but at the same time they still need to make profit. Customer Confidence Towards The Safety

With a lot of natural disaster and terrorists attack that happen lately, customers will have worried to use airplanes services. Because they pay low price for the ticket, they are worried about the level of safety provided.

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Government Policy And Aviation Regulation

There are lot of news about the terrorist attacks and it makes most of the countries to take precautions action to prevent it to happen in their country. Therefore, their policy and regulation more straight. It makes it difficult to enter the country and will cost complexity to the airline industry. Increase In Operation Cost

The increase of wages, fuels, maintenance cost and many other elements will contribute to the increase of operation cost. This is not a good sign for AirAsia because they need to provide the best services and at the same time, they cannot increase their price because the customer can shift to other competitors. Information System Disruption

Air Asia relies a lot on the web in terms of sales and promotion. It can be a threat if there are hacking activities, information systems breakdown, and also heavy traffic in their web. The risk is high and their business can be in dangerous too.

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5.2

VALUE CHAIN ANALYSIS

Legend CRS FSS YMS DBM IS CC : Computer Reservation System : Flight Scheduling System : Yield Management System : Database Marketing : Internet Sales : Call Center

Table above shows AirAsias Value Chain analysis based on Porters Value Chain. It shows list of significant activities to drive business continuity of AirAsia as market leader of Low Cost Carrier. By using single fleet of aircraft AirAsia reduces cost of maintain the plane reducing flight delay and turnaround time. Ground crew are well equipped, air crews are trained to multitask and AirAsia has its own academy to train pilots. With its current marketing and promotions, AirAsia will succeed by introducing more products and routes. And Finally AirAsia has to improve on its lead time to reach to customer in the event of complaints and inquiry.

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6.0

IMPLICATION OF CURRENT STRATEGY

After studying both the internal and external analysis of AirAsia, If AirAsia continues with its current strategy, it will remain profitable for a short term with new cost savvy airplanes and focusing on cost leadership. But AirAsia will not grow unless its addresses customers pain point and diversify its offering.

7.0

STRATEGIES AirAsias promotions are very well received by the consumer for example its Free Seat Promotion and Mega Sale Promotion. In order for AirAsia to maintain its profitability and ensure its stays in line with cost leadership business model, AirAsia has to offer more routes and products in its portfolio. Association of Asia Pacific Airlines stated that demand for air travel is projected to grow 5% annually, with the Asia Pacific region expanding at an even faster pace of 6% per annum over the next twenty years (AAPA, 2011). More routes and fleets mean more customers and potential ancillary income, in 2010 ancillary income per guest is RM 44 (AirAsia 2010a). Air Asia should also strongly focus on its offering via web booking as 77% of its revenue derives via internet (Appendix 9). To further proof this, during AirAsias Mind Blowing Fare, 538,000 tickets were sold in 24 hours and a record setting 36,871ticket per hour. (AirAsia 2010a)

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7.1

ALTERNATIVE STRATEGIES

Online Marketing Social media is a very powerful tool, in a recent survey by TNS, Malaysians have the most number of friends in social networking websites and spends 9 hours a weekly. (The Star, 2010). But in total, on average a Malaysian spends 19 hours and 48 minutes online whereby 54% of them are spent purchasing online, and a 46% trust the source obtained online. 94% of Malaysian uses social networking sites as shopping guidelines and 45% of them share their experience on their product, brand or experience. (Nielsen, 2010) AirAsia should continue to carry its promotions and focus even more on online marketing and selling. Social medias are mostly free and AirAsia should leverage on these platforms to market its product and also use it a medium to collect feedback. However, AirAsia should also be mindful as negative comments and bad customer experience will also be posted on the same platform and it is visible to everybody. AirAsia has to be tactful in handling these situations.

Increase Product Offering By partnering with Expedia, AirAsia adds value to its services by easing travellers to book accommodation and ground arrangements. AirAsia should work with more partners to obtain a better price so that its customer will be able to get better deals. Agoda, Booking.com, Wotif and Orbitz are a few other options for AirAsia to work with on accommodation. As for tour packages and ground arrangements, AirAsia should form collaboration with local partners, for example Reliance and Berjaya Holidays. These arrangements with local travel agents will also benefit AirAsia as they may set a quota or have an agreement with the local tour agents to use AirAsias services. AirAsia should also focus on new routes, for example, domestic flights within Thailand, Australia and India, respectively 34 %, 49% and 59% of all flight are domestic flights (Forbes, 2010).

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7.2

STRATEGIES IMPLEMENTATION 6 Ps Strategy When AirAsia started out as a low-cost airline in 2002, they pledged to make air travel affordable for everybody. AirAsia needs no introduction in Malaysia and Asean itself, its achievement of leading low-cost carrier, connecting people and place, AirAsia was established to create a new aviation product in Malaysia, one would that be revolutionize air travel, and grow the local aviation market by providing incredibly low fares so more people can fly. AirAsia has evolve rapidly, from an airline with two aircraft plying six routes in Malaysia in January 2002, AirAsia has soared in the last nine years to cover 78 destinations in 25 countries. In term of product or service, AirAsia take charge in expanding their offerings. Product/ Service Starting with only limited number of resources and assets, AirAsia has move forward by offering air travel to 65 destinations. With the help of affiliates and subsidiaries, it makes AirAsia accessible in almost everywhere. AirAisa has also aware of the increasing demand and competition, and they had made a decision to convert the existing fleet of ageing aircraft with the higher capacity yet more fuel-efficient, reliable and cost-efficient Airbus aircraft. Service can be explain as doing work for someone in exchange for money. In airline business, product can be differentiated into three level that is core,

supplementary and augmented. Core product is transportation services, that connect anyone anywhere around the world. Core product relatively plays significant role in attracting and delivering value to the customers. AirAisa have cater the needs of transportation by having wide area of destinations. Supplementary product are check-in, food on board, complementary gift, in-flight entertainment. Supplementary product add extra value for the current offerings. For augmented product of AirAsia are online booking, variety of seat meal options, and mobile ticketing. Since AirAsia is promoting lower fare travel, thus it lead to limited service offerings which then create low expectation from customers who expect much, that will then make them shift to other airline

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service like MAS or Malindo. But still, it is AirAsia strategy, no frills or extra service since it is low costs airline travel. Price As for price sets in airline industry, there are number of price setting. Mainly are class of travel (business, economy), load factors (luggage), date of travel (festive season), day of travel, profit margins, and competitors pricing. As for AirAsia, since the company practising low-fare travel, therefore the class of service is only two class, business and economy. The difference of the service between this class is the price level, and its in-flight and on ground services. AirAsia practising simple business level that helps in delivers lowest fare levels. People Other observable strength of AirAsia would be the well-rounded and managed business which has give them advantage over other airline. In 2007, AirAisa has won Airline Human Capital Development Strategy Award by Frost & Sullivan, which shows the power of people in business. By employing and trains staffs with superior interpersonal skills, AirAsia has been known as a well managed firm which lead to lower operating costs among other airlines. With a fleet of 72 aircrafts, AirAsia flies to over 61 domestic and international destinations with 108 routes, and operates over 400 flights daily from hubs located in Malaysia, Thailand and Indonesia. Lowest operating costs, definitely helped AirAsia in achieving their mission, low fare air travel that allow everyone to fly. With low level of operating costs, it may gives AirAsia to develop and improve their infrastructures, aircraft and such. But still, AirAsia do faces obstacle in maintaining human power in the firm itself, and also among the affiliates and subsidiaries. Complaints have rises in the digital world, regarding the inconsistency of frontline service. Recently, cases of Malaysians whom daughter are unwell, and not being treated well by the subsidiaries frontline staff in Vietnam have arouse the uncomfortable situation to the firms image. It is important to pay attention to the staff personal qualities and work skill training. The staff training cannot be ignored. The hotel could cultivate the 16

staff with more than one work skill and provide the customer with more perfect service. Since the customers are involve in co-production, therefore it is important to create user-friendly environment between the staff and the customers. According to Kapaki (2012), interpersonal service , that is the service friendliness, attentiveness, professionalism and personal recognition is among the five element that create value during a hotel stay. Approach in creating a good staff is by building self-assessment mechanism. The staff self-assessment result reflects the staffs work attitude, difficult and expectation, to provide reference information for hotel. It would be helpful for the hotel to build the fair assessment system, create an ordered competitive environment to stimulate staff work enthusiasm and improve service quality and customer satisfaction. Therefore, it is important to increases staff productivity and reduces response time to satisfy guest requests. PROCESS Time assumes importance. see time as to factor often great Customers a be scarce spent

resource

wisely, and the customer dislike long waiting time that involve along hotel as the will their

process. Good see process

competitive edge, as they can compete in the

speed of delivery process. A key concern for

customers is how much time making elapses a between for

request

service and receiving the finished output. This is to 17

say timing is a function of service quality in the service industry. Being punctual and reliable is necessary to perform a consistence and assurance that the delivery system will deliver what has the hotel promised to the customers. The service provider need to be knowledgeable of the way the service is generated and delivered to the customers. In this case the aspect of communication, and strategies form part of process information. Process information is about the nature of the value creation and the delivery systems. In line with AirAsias mission, embracing technology to reduce costs and enhance service levels, one way to utilize the digital world is by ease the customers in any service that involve them. One of the process that involving the customers are ticketing. PROMOTION (MARKETING COMMUNICATION) Promotion creates effective communication between the customers and the marketers. Modern marketing calls for more than developing a good product, pricing it attractively, and making it accessible. Companies must also

communicates with present and potential stakeholders, and the general publics. For most companies, the question is not whether to communicates but rather what to say, how to say it, to whom and how often. To effectively reach and influence target markets, a good marketers are creatively employing multiple forms of communications. Promotions consists of mix components that is advertising, sales promotion, events and experiences, public relations and

publicity, direct marketing, and personal selling. Since AirAsia is in the move to enhance the service level digitally, therefore, the promotion channel can be employed using the digital technology, Internet. AirAsia have widely promotes its product, that is low fare air travel to number of destinations. AirAsia might need to educate the customers on their

offerings. There are number of

customers who gives negative feedback

regarding the limited service performed, without being aware that it is the companys business strategy no frills, low fare travel. Which means service is limited due to low costs can target. Besides uses it as a that, by channel in using having marketing a direct

communications, AirAsia

communications with the customers. Recently, there is an issue regarding Malaysian woman whom travelled to Vietnam, with her sick daughter. They do 18

not gets a well treat from the subsidiaries staff there, and this issue have been viral in the Internet, and creates negative image. AirAsia does not take quick actions in handling the issue, until its rivalry MAS who took it as an opportunity to create companys image by giving helps to the poor woman. AirAsia should involve more in Corporate Social Responsibility (CSR) activities. This to create pleasant image of the company towards people. PLACE In airline industry, place can be identify as the distribution channel. AirAsia have wide area of destinations, subsidiaries and affiliates around the Asean region. In expanding the business, AirAsia might considering to go global. AirAsia have experience, skills and capabilities in handling demand from around the world. With the reported ordering of 100 new Airbus, it will gives AirAsia boost in offerings. Currently, AirAsia is able to be access from

anywhere anytime. With the service of internet booking, subsidiaries and affiliates sales office, authorised travel agents, it allows the future and current customers to reach them. Multi-language preferences in the website also makes the site user-friendly.

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Mickinsey 7s Implementation Framework STRATEGY The strategy of market development and market penetration must be implemented in the company in term of its operation. The market development strategy means such as opening the new routes for airlines in new location to attract more customers. The market penetration strategy is such as do mass marketing via many sources especially media to attract customer using airline services offered by the company.

STRUCTURE The company must be the divisional structure based on geographic area such as Indonesia, Filipina, Thailand, and other destinations of airlines because this will make the company more focus on its geographical area of airlines performance.

SYSTEM The company must be come out with new management information system within company for effectively disseminate any important information to staff and top management of the company. Any complaint or problems could be managing efficiently by doing this system.

STYLE Maintaining its current style of promotion must be based on its present current tagline Low Cost Carrier. For that can the company can obtain loyalty from their customer and maintaining high revenue.

SHARED VALUE Concern more towards its shareholders by increase of dividend payments to them to get full support and loyalty towards the company. They will feel it is worth it to invest in the company and definitely drag others investors to invest.

STAFF

Provide development training to all staff for always maintain its services that have been provided to customers. Staff should always know the current development and changes which are the company made. 20

SKILL The company should look out more to employ expertise in term of develop its operational system and also marketing strategies. This is because nowadays customers tend to be attracted with implementation of mass marketing by using latest technology devices.

8.0

IMPLEMENTATION Advertising will take place across of number of different mediums including television, print and outdoor (Air Shows).

9.0

EVALUATION The Integrated Marketing Communication methodologies will be judged on their ability to create brand identity, develop brand awareness and they will be assessed throughout the year in order to change aspects which are not working towards fulfilling these aims.

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10.0

CONTROL Prime Responsibility Purpose of Control Approach Sales analysis Market-share analysis Sales-toexpense ratios Financial analysis Market-based scorecard analysis Profitability by: Product Territory Customer Segment Trade channel Order size Efficiency of: Sales force Advertising Sales promotion Distribution Marketing effectiveness rating instrument Marketing audit Marketing excellence review Company ethical and social responsibility

Type of Control

I. Annualplan control

Top management; middle management

To examine whether the planned results are being achieved

I I. Profitability control

Marketing controller

To examine where the company is making and losing money To evaluate and improve the spending

III. Efficiency control

Line and staff management; marketing controller

Efficiency and impact of marketing expenditures

IV. Strategic control

Top management; marketing auditor

To examine whether the company is pursuing its best opportunities with respect to markets, products, and channels

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11.0

CONCLUSION The competition among airplane industries is very tough. Each of airplanes company in the world trying to conduct some strategies to compete with another competitor in their industry. To compete with their competitor in the business environment, a company needs to make a strategy to achieve their long terms objective and can be successful for doing their business. The strategic management becomes important due to the following reason such as globalization to survival their business, and than e-commerce become the critical success to the company nowadays. A company needs to consider the company ability and how to integrating it with the as well as main factor in the internal and external factor.

How AirAsia can be a leader in the lowest cost carrier in the airplane industry? To be a leader in the low cost carrier, firstly, AirAsia need to consider about their strategic management. The reason why need to consider strategic management because the first reason is because the airline industry is a unique and complex industry. The second reason, the strategy that AirAsia need is not just how to reduce cost and make the operational activities running effectively. But, AirAsia needs to come out with the strategy that can make competitive position that the company performs different activities from rivals or performing similar activities in different ways to achieve their business successfully.

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Appendix 1 AirAsia Routes Source: http://www.airasia.com/my/en/flightinfo/routemap.page

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Appendix 2 Jet Fuel Price Movement over Past 5 Years Source: http://www.iata.org/whatwedo/economics/fuel_monitor/Pages/price_development.as px

Appendix 3 Jet Fuel Price over Past 6 Months Source: http://www.iata.org/whatwedo/economics/fuel_monitor/Pages/price_development.as px

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Appendix 4 Malaysia's demographic and economic indicators Source: http://www.euromonitor.com/malaysia/country-factfile

Appendix 5 Malaysian GDP for 10 years Source: http://www.tradingeconomics.com/malaysia/gdp-per-capita-ppp

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