Term Paper on "Marketing Aerospace Industry"

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Marketing - Aerospace Industry

An Analysis of Commercial Space Travel Marketing in the Aerospace Industry Today

I've heard], 'If God wanted us to fly into space, he would have given us more money.' Hopefully, the technology demonstrated here today will lead to designs that are cheaper and easier. - Test Pilot Mike Melvill following his historic flight into space aboard SpaceShipOne

The first private astronaut, Dennis Tito, had to pay the Russians $20 million for his brief visit to their space station just a few years ago, but by his accounts, the hefty price tag was well worth it. Likewise, the first private spaceship has already traveled into the lower limits of outer space to international acclaim and enthusiasm from private citizens who are now wondering if they too may have a chance to travel into space. It is little wonder then that there has been an increased amount of attention paid to recreational space travel as a natural extension of the various governmental and military-related space programs in place around the world today. This paper provides a review of the relevant peer-reviewed and organizational literature to determine what ongoing initiatives are taking place to help launch ordinary people into space today and in the future, and how these initiatives are being marketed according to the "four Ps of marketing." A summary of the research and salient findings are presented in the conclusion.

Review and Discussion

Background and Overview.

Many people today may not even know a time in history when there was not a full-time manned presence in outer space, but up until the closing years of the 20th century, full-time presence was dominated by the United States, Russia and, most recently, China. Despite the enormous amount of international attention garnered by the first manned trip to the moon, most people assumed that outer space would remain the sole domain of such governmental initiatives. For instance, in his book, Space: The Free-Market Frontier, Hudgins (2002) reports that, "On July 20, 1969, Neil Armstrong and Buzz Aldrin became the first humans to land and walk on the Moon. At that time most Americans found it difficult to imagine that the vision presented in the movie 2001: A Space Odyssey, of regularly scheduled commercial flights to Hilton hotels in orbit, would not be in our future" (p. ix).

Although there is no Hilton in outer space (yet), the U.S. Commerce Department's Office of Space Commercialization recently estimated the 2002 global revenues for commercial space transportation and satellite technology at $105 billion, an amount that continues to grow rapidly today (Coren, 2004b). According to Coren (July 14, 2004a), "The man who became the first person to pilot a privately built craft into space called his flight "almost a religious experience" after his safe landing. Test pilot Mike Melvill landed at Mojave Airport, about 80 miles north of Los Angeles, California, after taking the rocket plane SpaceShipOne to an altitude of more than 100 kilometers (62.5 miles) -- the internationally recognized boundary of space" (p. 2). The facilities at Mojave are a licensed spaceport and the world's only civilian test flight center (Coren, 2004b). Based on his unique and historic achievement, the 63-year-old Melvill received the first pair of commercial astronaut's wings from the Federal Aviation Administration (Coren, 2004b). In response to the historic space flight, Pattie Grace Smith of the FAA enthused: "We have opened the frontier of human space flight. it's a major step ushering in a new era of low-cost space flight... In reach of ordinary citizens" (emphasis added) (quoted in Coren, 2004b at p. 3).

The historic flight into space by SpaceShipOne represents the culmination of Burt Rutan's efforts to provide affordable, safe, private space travel. Rutan's company, Scaled Composites, constructed SpaceShipOne with financial backing from Paul Allen, one of the founders of Microsoft Corp., for a just over $20 million (Coren, 2004b). A readers' survey administered by CNN following the successful return of SpaceShipOne indicates that a vast majority of Americans currently believe commercial space travel is not a matter of if, but of when as shown in Figure 1 below.

Figure 1. Results of 2004 CNN Readers' Survey: "Will space tourism take off?"

Source: Based on graph in Coren, 2004b at p. 4.

Current Private Space Travel Initiatives.

Price. The price of private space travel has been prohibitive for all but the most wealthy in recent years, but this is changing rapidly. According to Park (2006), "The ingenuity of the human race has led to breakthroughs in space technology that have reduced the once insurmountable costs of space access. As a result, the world is witnessing a rapid proliferation of new space actors as well as an increasing commercialization of space. In light of these facts it is impossible to deny that space is the next strategic frontier, both militarily and economically speaking" (p. 871). Indeed, as Said (2004) emphasizes, Virgin Galactic plans on selling brief trips in suborbital flights into space for a "mere" $200,000, with even this drastically reduced price being expected to drop even further in the future. "Because the cabin will be pressurized," Said advises, "those on board won't need to wear spacesuits. Nor will potential space tourists need NASA-caliber doses of the right stuff: Virgin Galactic will take anyone 'reasonably fit' and able to cough up the $200,000 fee and spare a few days for training. The company thinks it can sign up 3,000 customers within its first five years and predicts the price eventually will drop enough to make space flight affordable for the masses" (2004, p. 3). The Spaceship Company is not without competition, though, and its suborbital space flights are faced with some stiff competition from other up-and-comers in the commercial space travel industry. According to Graham-Rowe, in late 2007, a British company, Starchaser, plans its first space launch from a spaceport in New Mexico. "If the company's founder, Steve Bennett, is successful, his spacecraft will become the first British rocket to be launched into space in more than 35 years and by 2009 the first ever to launch a man into space" (Graham-Rowe, 2007, p. 14). While the Spaceship Company's spacecraft will deliver 200 private astronauts into the stratosphere, Starchaser intends to send three private astronauts into space by using a rocket; the company has already sold two seats on its maiden trip to anonymous travelers, at less than half the price being commanded by the Starship Company (Graham-Rowe, 2007). Even at half the price, though, there appear to be "twice the thrills" involved in the Starship Company's approach: "Both flights offer the thrill of up to five minutes of weightlessness in space, but the similarities end there. Sir Richard's passengers will land back on Earth like a conventional flight, whereas Mr. Bennett envisages that he and the mystery couple will descend by parachute from their capsule at a height of about 25,000 feet" (Graham-Rowe, 2007, p. 14).

Product. On July 27, 2005, Sir Richard Branson, the founder of Virgin Group of Companies and Burt Rutan, president of Scaled Composites, formed a new aerospace production company to build a fleet of commercial sub-orbital spaceships and launch aircraft specifically for personal space travel purposes (McQuillan, 2005). The new company, the Spaceship Company, owns the designs of the new SpaceShipTwo (SS2) and White Knight Two (WK2) launch systems that are currently under development at Rutan's company, Scaled Composites (McQuillan, 2005). According to Rutan, "The Spaceship Company plans to make spaceflight affordable for the masses and to demonstrate the commercial viability of manned space exploration" (quoted in McQuillan, 2005 at p. 3). Following the formalization of the agreement, Rutan observed: "I am very excited to have agreed the terms on which we can now move forward to develop the world's-first commercial, passenger-carrying Spaceships. This will truly herald an era of personal spaceflight first described by the visionary science fiction writers of the 1940s and 1950s" (quoted in McQuillan, 2005 at p. 4). The launch customer for this new joint venture between Virgin Group and Scaled Composites will be Virgin Galactic, Sir Richard Branson's commercial space tourism venture. Virgin Galactic has placed orders for five SS2's and two WK2's, with options on further systems, thus securing the exclusive use of the systems for the initial 18 months of commercial passenger operations. The Spaceship Company plans to make spaceflight affordable for the masses and to demonstrate the commercial viability of manned space exploration (McQuillan, 2005).

Promotion. The current channels by which private space travel companies are "getting the word out" are comprised of various online media, as well as extensive coverage in the domestic and international print media that continues to generate public interest in commercial space travel. For example, Scaled Composites, Virgin Galactic, and Starchaser all maintain extensive Web sites to keep the public informed of recent advances in technology and safety, as well as to generate interest in their initial launch series set for the near future.

Place. Distribution of the private space travel "product" is complicated somewhat by the need… READ MORE

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