Marketing Essentials: Airlines Comparison and Marketing Plan Report

This report, prepared for a Marketing Essentials course, provides a comprehensive comparison of the marketing strategies employed by Vietnam Airlines and Vietjet Air. The analysis begins with a detailed examination of their service offerings, including ticket classes, pricing strategies, and in-flight services, highlighting the key differences in their approaches. The report then delves into their promotional and communication strategies, exploring how each airline positions itself in the market and targets its customer base. The distribution systems, physical evidence, and operational processes of both airlines are thoroughly evaluated, along with their people strategies. Part B of the report constructs a detailed marketing plan for Vietnam Airlines, including a situation analysis (market, needs, trends, and growth), SWOT analysis, competitor analysis, and company analysis. It establishes marketing objectives, segmentation, targeting, positioning, differentiation, and marketing mix elements (price, place, promotion, and product/services). The plan concludes with budget considerations and implementation strategies, offering a complete overview of airline marketing practices and strategies in the Vietnamese market.

Assignment 1: Marketing essentials
PHAM TRAN MINH TUAN
F12-151 – F11C
Roberto Ercole

Student Name /ID Number PHAM TRAN MINH TUAN / F12-151
Unit Number and Title Unit 2: Marketing Essentials
Academic Year Semester 2, Academic Year 2018-2019
Unit Assessor Dr. Roberto Ercole
Assignment Number and Title ME2: Marketing Strategy and Application (2 of 2)
Issue Date 8th May 2019
Submission Date 13th June 2019
IV Name Mr. Martin Ortega Azurduy (IV) Ms Doti Chee (Lead IV)
Date 20/6/2019

Table of content
Contents
Introduction ........................................................................................................................... 5
Part A: Compare how Vietnam Airlines and VietJet Air ...................................................... 5
1.1 Services ........................................................................................................................ 5
1.2 Price strategies by the two companies ..................................................................... 7
1.3 Promotion/Communication ........................................................................................ 8
1.4, distribution system .................................................................................................. 10
1.5 Physical evidence ..................................................................................................... 12
1.6 Process ...................................................................................................................... 15
1.7 People strategy: ........................................................................................................ 16
Part B Vietnam airline’s marketing plan ........................................................................... 17
2.1 Executive summary: ..................................................................................................... 17
2.2 Table of content: I put the table of content in the beginning of the assignment .... 17
2.3 Situation analysis: ........................................................................................................ 17
2.3.1: Market analysis: .................................................................................................... 17
2.3.2 Market needs: ......................................................................................................... 17
2.3.3: Market trends: ....................................................................................................... 18
2.3.4: Market growths ...................................................................................................... 19
2.3.5 Vietnam airline macro environment: .................................................................... 20
2.3.6 SWOT: ..................................................................................................................... 21
2.3.7: Competitor analysis .............................................................................................. 21
2.3.8 Company analyze: .................................................................................................. 22
2.4 Marketing objectives: ................................................................................................... 22
2.5 Marketing strategy: ....................................................................................................... 23
2.5.1 Segmentation and targeting: ................................................................................. 23
2.5.2 Market targeting: .................................................................................................... 26
2.6 Marketing positioning and differentiation .................................................................. 27
2.6.1 Positioning: ............................................................................................................. 27
2.6.2: Differentiation: ....................................................................................................... 30
2.7 Marketing mix ................................................................................................................ 31
2.7.1 Price ......................................................................................................................... 31
2.7.2 Place ........................................................................................................................ 31
2.7.3 Promotion ............................................................................................................... 31
2.7.4: Product and services: ........................................................................................... 32
2.8 Budget ............................................................................................................................ 32
2.8.1: Forecast sales ....................................................................................................... 32

2.8.2 Forecast profit ........................................................................................................ 32
2.8.3 Cost of marketing activities: ................................................................................. 32
2.9: Implementation and control ........................................................................................ 32
References ........................................................................................................................... 33

Introduction
Marketing have become one of the most important factor in the successful of an airline, in
order to achieve an efficient marketing strategy, it is important that the marketing department
need create an detail marketing plan for the organization
Part A: Compare how Vietnam Airlines and VietJet Air
1.1 Services
Vietnam airline and VietJet provide a wide variety of product and service for their customer,
the first one is their ticket class. In Vietnam airline they provide 3 type of class for ticket and
they are
 Economy:
 Premium economy
 Business class
For Vietjet they provide ticket class such as:
 Promo
 Premium economy
 Sky boss
We can see that these both airlines provide different type of ticket class suitable for customer,
Economy and promo is lower-tier ticket whereas premium promo is mid-tier ticket and
business is high-end ticket.
Flight Vietnam Airlines Vietjet Air
HANOI – HO CHI MINH CITY 899.000 VND 599.000 VND
HANOI – Da Nang 499.000 VND 199.000 VND
HANOI – Phu Quoc 899.000 VND 499.000 VND
HANOI – Da Lat 2.250.000 VND 900.000 VND
HANOI – Buon Me Thuat 399.000 VND 99.000 VND
HO CHI MINH CITY– Nha
Trang 399.000 VND 58.000 VND
HO CHI MINH CITY– Hue 680.000 VND 199.000 VND
HO CHI MINH CITY– Hai
Phong 1.099.000 VND 590.000 VND
HO CHI MINH CITY– Da Lat 1.350.000 VND 1.370.000 VND
Phu Quoc – HANOI 899.000 VND 499.000 VND
Phu Quoc – HO CHI MINH
CITY 699.000 VND 390.000 VND
Hue – HO CHI MINH CITY 680.000 VND 199.000 VND
HO CHI MINH CITY– Pleiku 399.000 VND 299.000 VND
HO CHI MINH CITY– Hai
Phong 1.099.000 VND 590.000 VND
(Bantinhangkhong,2017)
This is the price comparison chart of one-way ticket provide by both Vietnam airline and
Vietjet, we can see that Vietjet’s price is cheaper than Vietnam airline from 200.000 VND to
500.000 VND.

Special service in flight
Category Vietnam Airline Vietjet
Services for children Under 2 years old:
 Children stroller
 Children cradle
 Special meal for kids
From 2 to 12 years old:
 Special meal for
children
 Portable in-flight bed
for children
The same
Unaccompanied minor
service
From 2 to under 6 years old
 Unaccompanied minor
service
 Accompanied cabin
crew service
From 6 to under 12 years old
 Unaccompanied minor
service
 Accompanies cabin
crew service (Optional)
From 12 to under 18 years old
 Unaccompanied minor
service (optional)
 Accompanied cabin
crew service (optional)
The same
Passenger with disability  Blind Passenger Service
 Deaf Passenger Service
 Wheelchair Service –
free of charge;
 Service dog
accompanying
disabilities
 Disabilities passenger’s
wheelchair
 Accompanies cabin
crew service (optional)
The same
Pregnant passengers Within 32 weeks:
Are accepted as regular
passengers
From 32 weeks to under 36
weeks
Medical clearances are required
MEDIF I and II
From 36 week
Air travel is prohibited
The same

Special case
Medical clearance are required
Category Vietnam airline Viet jet
Cargo  General
 Perishable
 Live animals
 Dangerous
 Wet
 Express
 Vulnerable
 Trucking service
 Dangerous goods
 Perishable
 Valuable
 Live animals
 Pharmaceuticals
 Seafood services
 Vulnerable services
 Express services
Both Vietnam airline and Vietjet airline provide cargo services for transfer goods, we can see
that both brands are provided similar cargo service such as dangerous goods, perishable, etc.
1.2 Price strategies by the two companies
Vietnam airline one-way ticket price from Hanoi to Ho Chi Minh City (Vietnamairline,2019)

Vietjet one-way ticket from Hanoi to Ho Chi Minh city
General polices:
Vietnam airlines:
Vietnam airline are one of the most popular airlines in its industry, If passenger travel with
children under 2 years old, children ticket price will be charge at 10% of the adult price,
children from 2 to 12 years old will be charge at 90% price of adult ticket.
Vietjet:
Vietjet air children ticket will usually mark as the same price as adult, however baby ticket is
free of charge.
The two pictures above have illustrated the information about each flight available on July
2nd, 2019, we can see that there is a clear different between the price range, Vietnam airline’s
ticket price is twice the price of Vietjet air
In conclusion, Vietjet provide their flight ticket at more a affordable price than Vietnam
airline although Vietnam airline ticket is more expensive but it will include in-flight services.
1.3 Promotion/Communication
Vietnam Airlines:
High-end airline
Vietnam airline in customer mindset is “Vietnam national airline”, They mark themselves as
high-end airline brand of Vietnam. Vietnam airline will put services quality is number 1
criterion. Vietnam airline provide service for their customer such as Lotus tax-free shop, In
the industry Vietnam airline is the only airline that have been given 4 stars by Skytrax which
make them the number 1 airline in Vietnam
(Thang Nguyen,2018)
Distribution agent worldwide
In term of buying Vietnam airline ticket, customer will have a wide variety in purchasing
method such as online payment through website, buy ticket in the airport, authorize agent

nearby. These agents will provide customer with flight time, best deal in the day, promotion
such as golden hour, summer sale or pre-order to get the best price.
(Thang Nguyen,2018)
Promotion
Vietnam airline provide lots of promotion for their customer such as summer sale, pre-order
the ticket to get cheaper price in order to attract more customer. In marketing, Vietnam airline
usually cooperate with influence people or celebrities such as football player, supermodel,
politician to become the brand ambassador, Vietnam airline also sponsor many tournaments,
game show.
Vietjet Air
Orientation: Vietjet air customer orientation is youngster, teenager who travel a lot to
explore, people who travel by plane for the first time, and have a low to mid-range income,
that is the reason why Vietjet orientate themselves as an “affordable airline”, because of
identifying the right target Vietjet have achieved great success when it first debut. Vietnam
airline is a high-end airline which their target customer is high incomes, the born of Vietjet
air have create an opportunity for many to travel by plane at an affordable price.
Price strategy:
“Affordable price” is the main strategy that Vietjet air still apply until this day, this strategy
suitable for many customers because it is based on the average income of a normal person in
Vietnam. In order to achieve that “affordable price range”. Vietjet air have to find the most
effective way to optimize the cost by using A320 and A321 airplane which serve for short
flight (5 to 6 hours) these type of airplane will help Vietjet airline saving a huge amount of
cost for food, rest for the crew , gas for airplane, Instead of provide meal include in the ticket
price they will offer in-flight meal separate as a service for customer who needed.
Flight distribution strategy:
In its plan to expand it route, Vietjet air prioritizes international route currently among 76
routes of Vietjet there are 38 internationals routes which take 50% of the total number of air

routes with the total number of inland flight hours. Vietjet is planning and preparing for long-
hour flight by using latest airplane.
In order to provide better services, Vietjet air have cooperate with many retail corporations
such as Walmart, for international routes Vietjet air have signed an agreement with Japan
airlines and agreed with US and South Korea. In 2019, it is expected that they will open the
first route to US
“Sexy brand”
Unlike many other brands which only focus on developing their industry, Vietjet air is also
known as “sexy airline in Vietnam”-the most notorious airline.
Although this marketing strategy have brought many negative comment and response to the
airline, but it has made the popular of vietjet air skyrocket, in addition according to CAPA
Vietjet brand identity is 98% which is relatively high.
Summary: Both Vietnam airline and Vietjet air have different strategy for the customer
because their orientation is different, Vietnam airline aims for mid to high income customer
where as Vietjet air aims for low-income customer.
(Kenh14,2018)
1.4, distribution system
Vietnam airline distribution system is directly handling the ticket to customer, so it does not
have a franchise. Their distribution channel is included 27 booking office, 422 retails agent.
Intermediate distribution:
 Retails agent will represent and selling ticket for Vietnam airline
Vietnam
Airline
Intermediate
distribution Customer

 Vietnam airline will sell ticket through their booking office
 Customer can purchase ticket from post office
 Order ticket online through their official website
 Order ticket through phone
Vietnam airline product flow chart:
Product => transport => represent office => retail agent => customer
The ticket process can be transport directly to customer or through represent office and retail
agent.
Vietnam airline negotiate flow chart:
Product ↔ Represent office ↔ retail agent ↔ customer
This negotiate flow happened in the process of exchanging ticket between customer and
represent office and retail store in order to achieve satisfaction for both sides.
Vietnam airline owning flow chart:
Production => Customer
This represent the ownership transfer between Vietnam airline to their passenger
Vietnam airline payment flow chart:
Product <= represent office <= Retail agent <= Customer
-------------------------------------------------------------
Customer can purchase ticker through retail agent or represent office as well as booking
office
Vietnam airline information flow chart:
Product ↔ transport ↔ represent office ↔ retail agent ↔ Customer
↕ ↕ ↕
Customer will do research on price, ticket class, services… , Vietnam airline will research on
customer needs which make this become a two-way flow process
Vietnam airline promotion flow chart:

Product ↔ Represent office ↔ retail agent ↔ customer
Vietnam airline will provide promotion, create deal and sale to attract more customer
Vietjet air:
Vietjet air choose to distribute their ticket through represent office and online website
through www.vietjetair.com. Vietjet air provide customer 81 destination ( 17 domestic and 64
international routes), Because Vietjet air orientate themselves as “affordable airline”, they
provide and create many promotion, sale which make the distribution of Vietjet air can be
apart from direct selling.
Product Transport Represent Office Retail Agent Customer
Intermediate distributor
1.5 Physical evidence
Vietnam airline:
Location of retail agent:
These retail agents have to meet the requirement of Vietnam airline, these retail agents must
be place in crowded resident, center of the city, large space for customer. Retail agent’s
infrastructure such as board sign, transaction section, table chair, etc.… have to be
synchronize with the image , brand , design of VNA in order to attract customer when they
are inside as well as outside the retail agent , this will make the custom impress by
professional style and trust when using the service.
Airport’s infrastructure: (Vietnam airline,2018)