Marketing Management

This report discusses the business elements and factors of Qantas airlines, including their mission and vision statement, marketing orientation, service portfolio, 5Cs analysis, market intelligence approach, target customer segment, and marketing mix strategies.

Running head: MARKETING MANAGEMENT
Marketing management
Name of the student
Name of the university
Author note

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Executive summary
The aim of this report is discuss about the business elements and factors of Qantas airlines. It is
the leading flight service provider in Australia. This report had discussed about the mission and
vision statement of Qantas along with the marketing orientation of them. The service portfolio of
Qantas is also being discussed in this report. In terms of the 5Cs analysis, it is identified that
competitive scenario is high for Qantas with having high bargaining power of the customers.
This is also confirming the importance of effective marketing strategies of Qantas. The approach
towards the market intelligence of Qantas is also critically analyzed and it is identified that
extensive approach is being followed. Based on the identified factors, the most potential target
customer segment is identified for Qantas along with the value proposition for them. The four Ps
of marketing mix strategy are discussed and recommended for Qantas that will help them to
manage the long term business viability.

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Table of Contents
Introduction......................................................................................................................................3
5C analysis of Qantas......................................................................................................................4
Company......................................................................................................................................4
Customers....................................................................................................................................5
Collaborators................................................................................................................................5
Competitors..................................................................................................................................5
Context.........................................................................................................................................6
Market intelligence approach of Qantas..........................................................................................7
Development of the marketing strategy...........................................................................................8
Identification of the value proposition.........................................................................................9
Identification of the positioning statement..................................................................................9
Recommended marketing tactics.....................................................................................................9
Product.........................................................................................................................................9
Price...........................................................................................................................................10
Place...........................................................................................................................................10
Promotion..................................................................................................................................11
Conclusion.....................................................................................................................................11
Reference.......................................................................................................................................12

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Introduction
Determination of the marketing management process and strategies is important for the
contemporary business organizations because it is effective in dealing with the current
competitive state of affairs. Each of the contemporary business sectors is intensely competitive
due to the presence of good number of players operating in the same field. Among this, one of
the most competitive sectors is the global airline industry, which witnessed rapid boom in the
recent time, thanks to the development in air transport infrastructure and inflow of huge
investment. More airliners are entering in this sector and increasing the intensity of competition
for the existing players. Australia is no exception to this global trend and also witnessing huge
surge in the competition in the airline sector. Qantas is the flag carrier of Australia and is the
largest Australian airliner in terms of the fleet size. Moreover, Qantas is also the third oldest
airliner in the world, founded in 1920. Thus, they are carrying immense heritage and brand value
with them (Homsombat, Lei and Fu 2014).
As per the mission statement of Qantas, they are striving to offer the best possible
services to the passengers and maintaining their rich heritage in terms of the service quality.
Thus, it is noted that Qantas is leveraging on their brand value and heritage in differentiating
their service approaches with their competitors. In addition, the vision statement of Qantas states
about the aim of becoming the market leader in the global market and covering more regions
across the world. Thus, the vision statement of Qantas states about their business development
and growth objectives. It is also identified that Qantas is following marketing orientation in their
business operation (Pearson and Merkert 2014). This is due to the reason that the service process
and approaches are changing in line to the change in the target market trends and preference
patterns. The customer centricity being followed in the organization conveys that Qantas is
following marketing orientation. For instance, they have initiated low cost airline service under
the sub brand of Jetstar in line to the current trends of low budget airliners. Their major revenue
unit is the premium airline service in the international routes and this service is only helping in
enhancing the brand value and identity of Qantas across the world.
This report will discuss about the different stakeholders of Qantas along with their
impacts on the business. In addition, the external business factors will also be discussed. The
approach of Qantas towards gaining market intelligence will also be evaluated in identifying

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their effectiveness and efficiencies. Based on the identified factors, the potential target market
for Qantas will be identified along with the recommended marketing mix strategies.
5C analysis of Qantas
Company
Internal analysis of Qantas will be done based on the SWOT analysis in order to identify
the key positive and negative factors.
Strengths  Brand value of Qantas is immense and evident across the world, which
further helps them in reaching out to larger customer segments.
 Being the flag carrier of Australia, Qantas is enjoying the most exposure
both in domestic and international market (Chang et al. 2014).
 Superior service process and quality is also contributing in the branding
process of Qantas due to the reason that customers seeking for best and
premium service process will prefer Qantas.
Weaknesses  Low profits in the international routes are one of their major weaknesses.
This is mainly due to the price based competition in the international
market.
 Lack of operating base in the western countries is creating issues in
tapping the shorter routes in the American regions.
 The average operating cost of Qantas is high compared to some of their
competitors. This is also contributing in reducing the profitability in the
long term (Arjomandi and Seufert 2014).
Opportunities  Developing countries such as the BRIC countries are showing positive
trends in terms of economic growth, which reflects the positive impact on
the airline sector.
 Shorter haul routes are witnessing rapid growth compared to the longer
haul routes. Thus, Qantas can have opportunities in terms of shorter haul
routes.
 Introduction of more fuel efficient aircrafts can help Qantas in reducing
their fuel cost and increasing profitability.

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Threats  Increase in the fuel cost will reduce the average profit margin of Qantas.
 Emergence of new competitors in the market will further saturate the
market condition for Qantas (Cui and Li 2016).
 Emergence of economic recession will badly affect Qantas due to the
reason that they are offering expensive and premium services.
Customers
Qantas is majorly serving to the domestic and individual customers and business clients
for their freight services. However, their passenger service will be disused in this report as the
key revenue unit. These customers include both tourists and business travelers. In terms of the
customer behavior, majority of them expects premium service and prestige in flying with Qantas
(Greig 2018). They tend to spend more premium price for the service quality over anything. In
this case, the snob effect is typical and evident from them because social class and status is
associated with the service of Qantas.
Collaborators
In terms of the collaborators, the major suppliers of Qantas are the aircraft manufacturers
such as Boeing and Airbus. This is due to the fact that Qantas is not manufacturing planes rather
they are sourcing the aircrafts from these manufacturers. Hence, the technological development
of the aircrafts will determine the service standards of Qantas along with their average operating
cost. Other partners of Qantas include the hotels, resorts, ticket bookings agents and
transportation partners. All these collaborators help in value creation for the customers of
Qantas. For instance, the “to and from” transportation facility for the passengers from airports
and convenient booking facilities are being managed by these partners. Hence, the value
proposition of the core service of Qantas is getting enhanced (Gregson et al. 2015).
Competitors
Some of the major competitors for Qantas are KLM, Singapore Airlines, Emirates, Qatar
Airways, Etihad and British airways. Each of these airliners is operating from decades and is
having positive brand value in the market. Thus, the competitive rivalry is high for Qantas in

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their business operations. However, the threat of new entrants is low due to the reason that huge
investment and expertise is required (David 2013). The worldwide access that Qantas is enjoying
cannot be matched by the new entrants and they will not be able to match the economies of scale
with the existing players. Majority of the new players are not having the required funding to
maintain the huge fleet size and international routes. On the other hand, there are number of new
entrants are entering in the local market level.
Context
External business contexts are important to analyze because change in the business
factors will affect the change in the business operation of Qantas. The following section will
discuss about the external business factors of Qantas on the basis of PEST factors.
Political and legal
factors
 Qantas is facing diverse political scenario in different regions
they are operating. This is creating issues in aligning their
standardized business process and practices with the different
political trends.
 Diplomatic relationship between the countries also affects the
business of Qantas because it determines the international
routes. Negative relationship can cause restriction in using the
air space, which further increases the cost of Qantas (Eaton
2013).
 Restrictions and limitations in foreign investments in different
countries are creating challenges for Qantas in tapping the
domestic foreign markets.
Economical factors  Average increase in the global economy will have positive
impact on the business revenue of Qantas. This is due to the
reason that the more will be the advancement in the economy,
the more will be the purchasing power of the potential
customers (Brown 2016).
 However, increase in the competition in different countries is
posing challenges for Qantas in the local level operations.

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 Globalization in the airline industry will also affect the
business of Qantas because it will attract more global
competition and also helps in getting access to larger regions.
Social factors  Social factors are more challenging for Qantas because
customer trends are inclining more towards the budget services
(Huettinger 2013).
 With the increase in the diversity of customer segments,
Qantas is facing the challenges of meeting the different cultural
and social expectations.
Technological factors  Qantas is well ahead in terms of developing and using newer
technologies.
 However, added cost is incurred in coping up with the change
in technological factors will increased the cost for Qantas
(Ozcan and Gunduz 2015).
 Safety related technologies are the key cost factor for Qantas,
which always need to be updated.
Market intelligence approach of Qantas
There are multiple approaches being followed by Qantas in terms of collecting data and
information from the market. Each of these approaches is helping in collecting data about
different factors. For instance, social media and touch points are the key sourcing units for
Qantas in collecting feedback about the customers. This is due to the reason that physical touch
points and social media are the two options where the customers are directly connected with the
brand. With the help of the social media platforms, Qantas is being able to review the feedback
of the customers regarding their newly launched or existing services. Based on these feedbacks,
the service process is getting changed (Luo, Zhang and Duan 2013). On the other hand, the
feedback of the customers from the live touch points majorly in airports is also helping Qantas in
gaining the insights. Social media mechanism of Qantas is well effective in competitor analysis
due to the reason that the feedback of the customers towards the competing brands can also be
accessed by Qantas. Competitor analysis is also being done by the third party market research

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firms, outsourced by Qantas. These firms are providing the holistic data sets to Qantas regarding
the market scenario (He et al. 2015).
Key performance indicators are being used by Qantas in determining the threat of
competitors. For example, determining the acquisition rate of the new customers of the
competing brands and Qantas helps in identifying the extent of threat for them. Moreover, use of
the key performance indicators is also helping Qantas in determining their strategic advantages
over their competitors. Determination of the change in the business context is being done by
Qantas through extensive market research activities and business forecasting process. This
market research process is being initiated by involving the specialized market research firms.
These firms are collecting and analyzing the data collected from the global perspectives and
enabling Qantas in having the idea of global trends in their business (Chung and Koo 2015). On
the basis of these trends, business activities are being forecasted for the next coming years. In
this case also, determination of the change in the customer feedback helps in identifying the
change in their taste and preference pattern. In terms of determination of the role of the
collaborators, Qantas is having effective mechanism of supplier management system. The two
major suppliers of Qantas are the Boeing and Airbus and effective supplier management system
is ensuring the design and utility of the aircrafts being manufactured according to the
specifications of Qantas. Thus, it can be concluded that Qantas is involving both external and
internal way of market research process (Luo and Zhang 2013).
Development of the marketing strategy
Development of marketing strategy should be based on the target market segment due to
the reason that the marketing strategy should be effective in meeting the expectations and
requirements of the targeted customers only. Thus, the primary step in developing the target
market is target market identification. The following section will identify the most potential
target segment for Qantas.
It is recommended that the most potential target segment for Qantas in terms of age
groups will be between 25 and 45. This is due to the reason that millennial is the most potential
and emerging target segment in the current along with the middle age adults who can be tapped
as the business travelers. This age group is having the potentiality and capability to avail the

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premium service of Qantas. In terms of income level, it is recommended that middle income
groups should be targeted as opposed to the existing higher income segment. Middle income
population is the maximum in the world and thus targeting them will increase the volumes for
Qantas. In terms of the geographic segmentation, it is recommended that Qantas should now
target the tier II cities as opposed to their current tier I cities due to the reason that tier II cities
are contributing huge in the airliner market and witnessing higher economical growth rate. In
terms of the behavioral segmentation, Qantas should target the customers seeking for reliable
services apart from the premium services (Cross, Belich and Rudelius 2015). This is due to the
fact that in the recent time, there are number of airline accidents occurred and customers can be
targeted on the basis of safety assurance. Loyal customers should be targeted and retained
through the loyalty program as they are having the maximum chance of contributing in profits
and revenue.
Identification of the value proposition
The value proposition for the customers of Qantas should be holistic and cover all the
added benefits for the customers. It is recommended that end to end services should be included
in the value proposition of Qantas. This include pick and drop services for the passengers and
offering dedicated lounge in the airport. The value proportion should also be based on money
due to the reason that customers are long expecting best value for money services. Thus, with
maintaining the same pricing structure, the facilities and services should be enhanced to offer
more values to the customers at the same price points (Canhoto, Clark and Fennemore 2013).
Identification of the positioning statement
The new positioning statement of Qantas will be “same heritage, more value”. This
denotes the focus on both competitive advantages of Qantas along with their new business
approach. For instance, focusing on heritage will help to distinct with their competitors and more
value will denote the more services and facilities to be received by the customers.
Recommended marketing tactics
Product

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It is recommended that the core service level of Qantas should be kept same as their
existing approaches but the augmented service level should be changed. This will include more
economical services in order to tap the middle income groups. In addition, the shorter haul routes
should be promoted over the loss making international routes. The most popular destinations
should be selected and those routes should be targeted. This will help in generating more sale
volumes and revenues. Personalization can also be initiated for the premium and business class
customers (Zou et al. 2014). In the current time, customers are expecting more personalized
services and offering this to the premium customers will further enable Qantas in retaining their
existing customer base. In terms of the aircrafts, it is recommended that Qantas should use
narrow bodied aircrafts also for their shorter haul services and more fuel efficiencies. These
narrow bodied aircrafts will be suitable for the shorter routes and smaller destinations and fuel
efficiency will ensure that cost of fuel will get reduced. Hence, the average profitability can be
enhanced for Qantas.
Price
It is recommended that Qantas should initiate more economical pricing in their service
offerings compared to the premium pricing now. This will be in line to new target segment of
middle income groups. The target segment will get extended for Qantas with the help of
economical pricing. On the other hand, it is also recommended that Qantas should also initiate
dedicated and separated pricing practices, which will bring more autonomy to the customers.
This is due to the reason that dedicated pricing will help the customers in paying the price only
for what they require. For example, in the shorter routes, they will pay for cuisines only if they
require (Kienzler and Kowalkowski 2017). This will help to offer a form of personalization to
the customers along with more choices for them. In addition, the dynamic pricing process being
currently followed by Qantas should be continued for the new target customer segments also.
Place
In terms of place and distribution, it is recommended that Qantas should follow Omni
Channel distribution strategy in offering the services to the customers. Qantas is already
following the online and offline mediums in delivering services such as ticket booking and
holiday packages. However, the availability of the services should be increased with more reach

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and penetration across the world. Their existing intensive strategy will not be effective rather it is
recommended that extensive distribution strategy should be followed. This will ensure Qantas in
having larger market presence and exposure across the world.
Promotion
Qantas is already following Omni Channel marketing process but it is now recommended
that they should have more market adaptable approach in targeting the customers from a
particular region. In this case, the cultural factors should be concentrated and promotional
activities should be initiated accordingly. For instance, targeting the Chinese customers should
be based on the trends and patterns in China. Thus, the probability of positive customer behavior
will be more for Qantas. The promotional elements of Qantas should not include their service
quality but also the safety standards. This will ensure the customers in availing the services along
with creating a distinctive positioning in the market.
Conclusion
This report concludes that Qantas is having effective and efficient mechanism of
managing their stakeholders. It is identified that one of the major limitations for them is the high
operating cost, which is affecting their profitability. On the other hand, inducting more fuel
efficient aircrafts will reduce their cost of fuel. In addition, it is also identified and extensive
market research process is followed by Qantas in gaining the market insights. This is helping
them in having the idea about the change in the external factors. Diverse political environments
across the world are also posing challenges for Qantas in their global operation. It is
recommended that they should target the millennial to have larger volumes. Based on these
factors, the four Ps of marketing are evaluated and suggested for Qantas.

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