Term Paper on "Relate Aviation to Marketing"

Term Paper 5 pages (1704 words) Sources: 1+

[EXCERPT] . . . .

Marketing the Business Class Service of Virgin Atlantic Airways

According to an April 2003 report from the Alexandria Va.-based National Business Travel Association, less than 5% of business travelers fly first and business class. Interestingly, however, these premium seats can account for 40% to 60% of an airline's revenue (Valhouli, 2004, para 9). It is hardly surprising, then, that airlines choose to focus so heavily on wooing this particular consumer segment. It is the objective of this paper to discuss how one such airline, Virgin Atlantic Airways, markets its business class service.

Branded as "Upper Class Suite," Virgin Atlantic's business class is aimed at the first and business class consumer segment, which the airline defines as consumers "predominately traveling on business, male, 35 to 45 years old, ABC1 and earning £50K plus per annum." (Student Information Pack, 2005, Section 3, Q 1) However, the "Upper Class Suite" is marketed in line with the overall brand values of Virgin, which are seen as "fun, caring, honesty, value, and innovation." (Reveries, 2002, para 10) Indeed, Virgin Atlantic's core brand values are reflected in every aspect of its "Upper Class Suite" marketing mix.

The "Upper Class Suite" Product and Service testimony to Virgin Atlantic having succeeded in developing a superlative business class product lies in the fact that its "Upper Class Suite" is often seen as equivalent to the first class service on other long haul airlines. For instance, Valhouli (2004, para 13) is almost apologetic over the fact that Virgin Atlantic could not be included in Forbes' list of Best First Class section on airlines since technically, its "Upper Class Suite" is business class. Valhouli's comment is perhaps best explained through a description of the innovative "Upper Class Suite" product and service.

Virgin Atlantic ensures that its premium paying passengers get full value for their money, beginning with the pre-flight experience, which includes courtesy limo transfers, a hassle free and short check-in process, and use of luxury lounges branded the "Clubhouse." Going several steps ahead of most other airline business lounges, Virgin's "Clubhouse" is lavishly appointed and offers table service along with a printed menu that lists a whole range of free hot and cold foods. In addition, the "Clubhouse" also offers amenities such as a free beauty salon, shoe polishing (the Travel Insider, 2003, para 1-12) and Wi-fi Internet access. Virgin's London Clubhouse is, in fact, rated as a state-of-the-art airport lounge, offering as it does a range of services such as video game stations and even a suit tailoring facility (the Travel Insider, 2004, para 11, 14).

The "Upper Class Suite" in-flight experience is deemed to be the latest approach to delivering a comfortable and enjoyable flight. Virgin Atlantic has made this possible through a great deal of thought and care in designing the in-flight product. For instance, each business class suite offers a very comfortable leather seat, each of which enjoys direct aisle access because all seats are arranged in a herringbone fashion. Further, Virgin has obviously studied the lie flat sleeper seats offered by its competitors and improved on it, as evidenced by the fact that the Virgin sleeper seats are not awkward compromises between a seat and a bed. Instead, Virgin's seats are designed to flip head over heels at the push of a button, thereby allowing the airline to convert the other side into a comfortable surface on which passengers can sleep. In addition, the airline also offers the largest fully flat bed of any airline, thereby ensuring that its passengers get a truly comfortable night's sleep (the Travel Insider, 2004, para 15-26).

Besides the lie flat sleeper seats, which have won Virgin at least 6 different design awards (the Travel Insider, 2004, para 27), the airline's "Upper Class Suite" offers other innovative facilities on board such as an ottoman on every seat, which can double as a seat for a guest; laptop power access in every suite; facility to enjoy a hydrating hand treatment, a pressure point hand massage or a beauty treatment in the onboard lounge area; and the luxury of ordering food from a "Freedom Menu" at will instead of being served meals at pre-determined times (VacationIdea, 2004, para 3-6). In addition, Upper Class passengers can relax in on-board lounge and stand-up bar areas or simply enjoy award winning in-flight entertainment. Individual Watchmans are also made available to those passengers who would like more movie choices over and above the 8 movie channels, 5 TV channels, Super Nintendo channel with 10 games, Sky Map, and 9CD audio channels that are part of the onboard entertainment system (Luxury Travel Source, 2005, para 2-3). With the extensive facilities and innovative features that are made available to Virgin's Upper Class passengers, it is easy to see just why the airline's business class service is rated as the "airline experience to measure all others against." (the Travel Insider, 2003, para 1).

Virgin Atlantic ensures the appropriate finishing touch to its Upper Class passengers' flying experience by giving them special "Fast Track" passes to avoid waiting in the regular lines to go through immigration. Further, priority baggage clearance enables "Upper Class Suite" customers to quickly pick up their bags and leave the airport (the Travel Insider, 2003, para 42). However, for those Upper Class passengers who wish to freshen up after their journey, the airline provides an arrival lounge at Heathrow with shower facilities (the Travel Insider, 2004, para 88). Thus, it is evident that a state-of-the-art Business Class product and service design has enabled Virgin Atlantic to brand its service "Upper Class Suite" and market a great value proposition to both first and business class customer segments.

Upper Class Suite" Pricing

In line with its value proposition of first class amenities at business class prices, Virgin Atlantic's "Upper Class Suite" offers competitive business class fares on all its routes. In addition, the airline adds more value through its corporate and individual frequent flyer program "flyingco." And "flying club." Since a majority of first and business class flyers travel on business, the airline has cleverly designed "flyingco." To reward both the corporate and the individual flyer by crediting miles (points) to both the company and the individual's account (flyingco., 2005).

Upper Class Suite" Placement

Virgin Atlantic currently flies to 25 destinations worldwide (All About Us, 2005, para 3). As such, the airline markets its "Upper Class Suite" services globally and is likely to step up its efforts in the future in keeping with its stated 10-15% per year growth plans (Karantzavelou, 2004, para 3). It is important to note, however, that although the product is available on many of Virgin Atlantic's flights, it is still being rolled out across the airline's fleet. Thus, while all flights to San Francisco, New York, Hong Kong, Tokyo, and Sydney have the "Upper Class Suite," it is available only on selected flights to other destinations. The rest of the flights currently offer the old Upper Class product with reclining seats (the Upper Class Suite, 2005).

Promotion of the "Upper Class Suite"

Virgin Atlantic uses both above and below-the-line promotion to promote its "Upper Class Suite." While advertising is used to encourage people to try the airline and raise awareness of new products and routes (Virgin Atlantic, 2005, Section 3, Q 2), below line activities include integrated offline and online direct marketing elements (Start, 2003, para 5) and sales promotions (American Express Incentive Services, 2004, Case 5). All "Upper Class Suite" communication is developed in line with the brand's value proposition, Virgin's core brand values, and bearing in mind the target segment. Indeed, these parameters are clearly reflected in the fact that the airline chose to give away American Express's "Persona Select" stored value card worth $500 dollars to incentivize Upper Class London-bound passengers to join its frequent flyer program (American Express, 2004, Case 5).

In a similar vein, Virgin gave away Handspring PDAs just prior to its market launch to passengers who flew its Upper Class. To announce the offer, the airline ran advertising, which said, "Virgin Atlantic offers you an assistant you can fool around with in London." (Reveries, 2002, para 16-17). Thus, it is evident that the airline promotes its "Upper Class Suite" bearing in mind the core brand values of innovation, fun, and value but also the profile of the business traveler. Indeed, this is reflected across the marketing communication done for the brand.

Conclusion

Virgin Atlantic's "Upper Class Suite" is an interesting marketing case study since it illustrates how each and every element of the marketing mix needs to be aligned with the overall marketing strategy. Thus, if Virgin Atlantic identified an opportunity in the aviation market for a first class service at business class prices, it had to redesign its product and service offering to reflect the proposition. Moreover, it had to ensure that the product's promotion did justice to the value being offered while simultaneously reflecting the overall brand values of irreverent fun, value, and innovation.

References

All About Us. (2005). Our Story: History. Virgin Atlantic… READ MORE

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