Segmentation, Targeting and Positioning of AirAsia Airlines

This report analyzes the segmentation, targeting and positioning of AirAsia Airlines in Malaysia. It includes demographic, psychographic and behavioral aspects of segmentation, along with branding plan and recommendations.

Running head: MARKETING MANAGEMENT
Marketing Management
Name of the Student
Name of the University
Author note

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Executive Summary
The report has thrown a light in the overall analysis of the segmentation, targeting and
positioning of AirAsia Airlines which is situated in Malaysia. The different aspects of
segmentation such as demographic, psychographic and the behavioral aspects have been
analyzed which is essential for overall identification of the success of the firm. The branding
plan have been conducted for AirAsia which helped in analyzing the mission, vision and the
objectives of the airlines which assisted in managing the overall efficacy of the firm in
comparison to the other competitors.

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Table of Contents
1.0 Introduction................................................................................................................................3
Company background..................................................................................................................3
Rational of your choice of the company......................................................................................3
2.0 Customer Analysis and Customer Segmentation......................................................................4
Segmentation...............................................................................................................................4
Targeting and Positioning strategy..............................................................................................5
Branding plan.............................................................................................................................11
3.0 Conclusions and Recommendations........................................................................................13
References......................................................................................................................................15

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1.0 Introduction
Company background
AirAsia is one of the Malaysian low-cost kinds of airline which was being headquartered
in Kuala Lumpur, Malaysia. This is the largest airline in Malaysia by destinations along with
fleet size. AirAsia operates in different scheduled international along with domestic kind of
flights wherein they travel to more than 165 destinations spanning in more than 25 countries
("Airasia.com", 2018). The company was founded in the year 18 November 1996 and the
company is headquartered at Kuala Lumpur which is situated in Malaysia. The number of
employees working in AirAsia is 17000 and the number of destinations wherein the Airlines is
operating is more than 74 countries in an effective manner (Gengler& Mulvey, 2017).
Rationale of your choice of the company
AirAsia has been chosen and taken into consideration as this is the public company which
has huge stock and this is known by the general public as well. Furthermore, this is one of the
largest low-cost airlines which is operating in Malaysia and the revenues which have been earned
by the company has been gaining huge profitability in comparison to the other competitors in the
entire market (Bruwer& Li, 2017). Moreover, AirAsia have strong kind of segmentation as the
main focus of the airlines is to provide the customers with low cost delivery and this has been
voted as the largest and the most convenient kinds of airline in the entire industry (Achroll&
Kotler, 2014).

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2.0 Customer Analysis and Customer Segmentation
Segmentation
According to Serrat (2017), segmentation plays a major role in the organization which
helps in managing the flow of the different goods and services of the company in reaching out to
the different customers in more than one nation for profit. There are different kinds of segments
in the AirAsia Airlines which are required to be described in such a manner which will help in
managing the overall effectiveness in the segmentation, targeting and positioning of the different
bases appropriately (Goworek, McGoldrick& McGoldrick, 2015). The segmentation of AirAsia
is inclusive of the following aspects which are described as follows:
AirAsia have strong kind of segmentation aspect in which this has been seen and
analyzed that the airline is mostly focusing on the providing low cost delivery to the different
customers who are travelling with them. This has been nominated and voted as the World’s Best
Low-cost airlines in the last five consecutive years from 2014-2018 (Möller&Parvinen, 2015).
The segmentation of the AirAsia Airlines has been done in such a manner which is inclusive of
the different demographics, user related, socio-cultural along with benefits sought segmentation
which helped them in segmenting themselves in an appropriate manner.
Under the demographic aspect, the income if one of the major variables which is
required to be taken into consideration of segmenting the market of AirAsia Airlines. Income is
one of the major indicators which are required to be identified for the different customers who
travel by AirAsia Airlines in comparison to the other competitors in the entire market
(Sargeant& MACQUILLIN, 2016). The Benefit Segmentation Strategy is being used by AirAsia
which helps them in catering to the different needs of the developed nations effectively.
Furthermore, AirAsia tries to offer the different individuals by offering them benefits of the low

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pricing as the Air Travel is being perceived as the most expensive travelling option effectively
(Kotler, 2015).
As per the geographic aspect, the segmentation of AirAsia has been done on the
basis of different regions travelling from China, India along with Vietnam (Shaw, 2016).
The age group is inclusive of all the age groups starting from kids, teenagers, old-aged and
middle-aged individuals (Schlegelmilch, 2016). On the basis of the psychographic aspect,
lifestyle is moderate-oriented and this is essential for the regular travel for the different
individuals. Lastly, the behavioral segment is inclusive of the different occasions wherein
the regular travelers are being taken as the major target segment along with the status of
the users are affordability as well.
Targeting and Positioning strategy
Targeting
Targeting is essential in nature as the target group of the different customers within the
serviceable market of the business which has decided to aim the marketing efforts towards
(Venter, Wright &Dibb, 2015). The targeting of the market is inclusive of the different
segmenting the market wherein the market is appropriate and this will help in determining the
products which will be offered in each segment. The major target customers who are being
targeted by AirAsia is inclusive of the ones who are conscious regarding the budget and keen
on saving time and money effectively.
Bases of Segmentation Target Segment (Economy Class)
Travel and Tourism Industry Base The main target segment base is economy class

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and the expectations of the customers are low
Psychographic Base The lifestyle of the different individuals in the
economy and budget airlines are moderate and
they prefer the same for the regular travel. The
personality of such individuals is easy going in
nature (Philip, 2016).
Behavioral Base The individuals who are being targeted in such
segment is inclusive of regular travelers and
who wishes to go in budget airlines and they do
not care about the comfortability and quality of
the airlines (Nijssen, 2017)
Geographic Base In the geographic base, the different customers
who are being targeted in these respective
airlines are starting from kids, teenagers along
with old aged (Pyo, 2015)
Bases of Segmentation Target Segment (Executive Club)
Travel and Tourism Industry Base In this respective class, the expectations of the
different customers are high along with the
image of the customers is positive in nature. The
descriptors of the trip are generally for the

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business purpose
Psychographic Base This is specifically for the different group of the
different individuals who prefer taking the
different business trips and this will be suitable
for the ones who can afford the same and the
lifestyle is achievement oriented in nature
(Parment, Kotler& Armstrong, 2016)
Behavioral Base This is for the luxury convenience along with the
expectations of the customers are high in nature
which will be appropriate for the overall
profitability of the firm in an effective manner
(Tanner & Raymond, 2015)
Geographic Base The major target segment is inclusive of the
urban individuals in the entire economy and the
individuals who are being targeted in the
respective aspect are the middle aged and the old
aged individuals as the young generations do not
have the capability to spend so much on the
exclusive club (Baker, 2016).
Bases of Segmentation Target Segment (First Class)
Travel and Tourism Industry Base The expectations of the customers in the first-

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class segment is really high along with the
image of the customers is highly positive in
nature and this will be suitable for the different
business trips as well.
Psychographic Base These first-class segmentsare basically
mandatory for the different business along with
honeymoon relate trips as this is not possible
for the individuals for afford it on the regular
basis as well (Armstrong et al., 2017).
Behavioral Base The benefits which will be analyzed are the
luxury kind of individuals which will be helpful
for gaining huge growth and profitability in the
entire market
Geographic Base There are selected kinds of international flights
for the specific and niche group of individuals
in the entire market. The density which will be
targeted by the AirAsia is inclusive of the urban
and the age is inclusive of the both middle-aged
and the old aged group of individuals in the
entire market (PhilipKeller, 2017)
Positioning

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According to Achroll& Kotler(2014), positioning is defined as the selection of the
marketing mix which is most suitable for the target market segment effectively and
appropriately. Furthermore, in business and marketing strategy, the positioning strategy plays a
major role along with refers to the different perceptions of the customers in the market in relation
to the different brands which are competing in nature. The positioning is referred to the process
of proper establishment of the image or the identity of the brand or the product wherein the
customers perceive it in a certain manner.
As far as the brand is concerned of AirAsia, the respective airways try to provide the
different kinds of hassle free experience to the different customers in the market effectively.
AirAsia has tried in positioning themselves in such a position wherein they are healthy in their
approach in comparison to the other peer competitors in the market effectively. The main
advantage which is being gained by AirAsia is that the company tries to position themselves in
various kinds of levels such as providing economy and budget airline services along with
providing the first-class services to the premium customers in the market as well (Achroll&
Kotler, 2014).
This is essential in nature for AirAsia to develop the positioning strategy as per the
marketing mix which will be helpful in managing the overall effectiveness of the firm in an
efficient manner. The different core elements of the marketing mix are inclusive of the product,
price, place along with promotional activities which will be helpful in managing the different
activities in an appropriatemanner.
Product: This is the major element of the marketing mix wherein this can be seen that
this relates to the service of the travelling by flight along with the consumption of the products
consumed during the flight effectively. There are different class in the AirAsia Airlines in which

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this can be seen that economy or budget class is inclusive of the different kinds of food, however
the other subsequent classes are inclusive of the more comfort provided to the different
individuals who travel by such airlines (Achroll& Kotler, 2014).
Price: This is the other respective strategy which is being pursued by AirAsia and this
differs in different kinds of customer segments effectively as well. For instance- the economy
class of AirAsia is the cheapest and budget airlines and there is no such comfort provided in the
economy class like premium class or first class. There are different specific kind of variables
which impacts the pricing strategy of AirAsia which as the structure of the different kinds of
discounts along with the residual values.
Place:This is the element in which this relates to the location of the purchase of the
different kinds of products and services. The AirAsia services are mainly distributed to the
different individuals through online channel of sales along with organizational and individual 3
Promotion: This is the other element of AirAsia wherein this can be seen and analyzed
that the slogan or the tagline named “Now Everyone Can Fly”. The company uses the set of
different marketing channels such as social media and other advertising channels which will be
helpful in appealing to the different customers.
Branding plan
The branding plan is essential in nature as this helps in differentiating the company from
the different other competitors in the market. The consistent along with strategic kind of
branding helps in leading to the ability of the company to separate from the competitors and
create a strong brand identity in an efficient manner.
Purpose and Mission of AirAsia The mission of AirAsia is to attain the lowest

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cost so that all the individuals can fly
efficiently. The purpose of AirAsia is to
provide the different flyers with safe along
with caring kinds of flying with the respective
airlines in an appropriate manner. the vision
of the AirAsia Airlines is to provide the
customers with proper and delightful kind of
experience at a low budget and this will be
helpful in increasing the overall revenue of
the company in an effective manner.
Statement of Brand Position AirAsia helps in providing the different low,
medium and high-income group customers
with comfortable flight with low budget and
prices which is affordable by all the
individuals effectively
Unique Value Proposition The unique value proposition of AirAsia is to
allow the different customers with budget
flight and this will be beneficial for the
company as this will help them in increasing
their revenues and profit effectively
Proof of the Claims From the different surveys, this can be
analyzed that AirAsia have been awarded as

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the cheapest airlines in the entire competitive
environment. The New York Times has
described the AirAsia Airlines as the pioneer
of the low cost travel in entire Asia and this
has helped them in increasing their overall
effectiveness
Audience Promise The promise which have been made to the
different audience travelling with AirAsia
Airlines is inclusive of the different kinds of
other experiences in the other first class and
premium class departments in an effective
manner.
Messaging Tone Persuasive in messaging tone as the Airlines
have been able to convince the different
customers in the market with the different
kinds of recognitions and awards which have
helped them in becoming successful
Elevator Pitch The AirAsia Airlines tried to provide the
different customers with the different kinds of
services such as providing budget flights at
low cost and providing all the income level
customers with proper services which is
effective in nature for gaining more

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competitive advantage in comparison to the
other competitors in the entire market
Tagline Now Everyone Can Fly
3.0 Conclusions and Recommendations
Therefore, this can be concluded that STP analysis of AirAsia have been taken into
consideration in the entire report. The segmentation, targeting along with positioning have been
done which helped in managing the overall success of the firm in the entire competitive airlines
market. Furthermore, the branding plan has been done which helped in managing the mission,
vision along with appropriateness of the same in the entire market effectively.
There are different recommendations which can be provided to AirAsia in order to
become more effective in their operations in the future is inclusive of the following:
Firstly, AirAsia needs to target only the business class individuals wherein they can
provide them with various offers which will be beneficial for the success of the organization
effectively. The company needs to improve their promotional activities effectively which will be
valuable for them in improving their overall sales and revenues in an appropriate manner.
Secondly, the extra luggage allowance is required to be started by AirAsia Airlines as this
will be beneficial for the overall convenience of the different passengers in an efficient manner.
By expanding their sponsorship of business of AirAsia, this will be helpful for the overall growth
of the firm in a suitable manner.

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Thirdly, the branding plan is required to be changed wherein the major customer base
which should be inclusive of the different young generation along with aged individuals in the
organizations should be targeted which will be suitable for the overall success of the firm
effectively.
Lastly, the segmentation is required to be diversified with application of the
differentiation strategy adopted by AirAsia Airlines as this will be beneficial for the overall
success of the firm and this will increase in the number of customers in an appropriate manner.

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