Thomson Airways Strategic Analysis

This assignment involves a comprehensive analysis of Thomson Airways, covering its organizational structure, operational performance, customer services, and competitive positioning. It evaluates the airline's strengths in using its strengths to grab various opportunities, while also considering its weaknesses, opportunities, and threats in the market. The analysis aims to provide insights into how Thomson Airways can generate more competitiveness among future airlines and cover large destinations by providing the best comfortable journey.

Extended Project

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
Background of airline company.............................................................................................1
Market positioning of Thomson Airways...............................................................................2
Targets of Thomson Airways.................................................................................................3
Firms competitive advantages. ..............................................................................................4
Thomson Airways market competitors. ................................................................................4
Marketing Strategies of Thomson Airways............................................................................5
Present position of the entity in market..................................................................................6
CONCLUSION ...............................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Marketing research, marketing mix, level of competitiveness, positioning, segmentation,
consumer behaviour are some factors that are vitally determined by every airline company in
regard to generate expansion or growth among its competitors. Such factors encourage
substantial development its revenue and recognition (Sato, Sawada, Shinozaki and Narasaki,
2016). Main aim of this research is to analyse market strategies and policies that are formulated
by cited company. It also determines the level in which consumer satisfaction is been attained
and its generation of growth as well as revenue.
Background of airline company.
Thomson airways desires to bring people from different countries together and provides
them with comfortable travelling wherever they needed. The research has identified that it
allows almost 10.6 million travellers with a comfortable journey every year. Travel company
possess many competitive advantages and likewise transform competitive strategies to become a
leading airline company all around the globe (Lord, K., 2016).
Cited company also offers several other services to potential consumers under hotels,
cruises, villas etc. and has adopted a partnership strategy within global flights to enhance its
brand name and growth in present and future perspective (Miyoshi and Ibáñez, 2016). Advisory
committee members of Thomson airways have formulated plans for developing their networks
under Singapore, China, Iceland etc. They targeted those segments which were lacking the
facility crossing wide networks or distances.
Further, it has become the biggest competitor among every other airline companies and
aims in establishing vast networks to increase its growth and revenue. This travel agency consists
of 19 airports within UK and provides leisure destination to their travellers. British government
has allotted them rights to use their own subsidization. Edinburgh, New castle, London Luton,
Cardiff, Dublin, Manchester, Birmingham etc. are some of its operating hubs (Wild, Murray and
Baxter, 2016). Further, there was substantial increase in demand for travellers which resulted in
development of larger flights. Therefore, cited company aims in providing sophisticated
comfortable travelling to their targeted costumers. They even provide with cargo facilities and
delivers them at possible short durations (About Thomson Airways, 2017).
With change in technologies, cited industry adopts inventions and creativities under its
equipment to attain complete satisfaction to their buyers. Less government intervention is
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experienced under this organisation after privatization. European and overseas dimensions have
non rights in taking any decisions regarding the policies of Thomson airways which reduces risks
and uncertainties under business environment (Yoshida, Miyaoka, Kanao and Sato, 2016).
Further, it initiates charter facility to rich class people which enhances its recognition and
reputation among other substitute companies. Cited firm has a huge dominance under different
segments and desires to cover destinations under Caribbean Sea areas.
Market positioning of Thomson Airways.
Thomson airways mainly targets holiday months to target more travellers in their parent
services for maximizing its sales (McDonald and Wilson, 2016). Further, it has initiated three
levels at which market can be easily identified and segmented including- niche marketing, mass
marketing and segment marketing. These are explained below: -
Mass marketing is a process where organisation aims in expanding the range of consumers from
different segments. Such marketing techniques does not aim in providing unique factors to their
buyers therefore aids in developing the process of its existing flights (Hassan and Rahimi, 2016).
However, this marketing strategy possess cost advantages in generating more revenue for the
company.
Niche marketing satisfies the needs and preferences of those consumers who are not being
concerned and analysed from its substitutes (Dziedzic and Warnock-Smith, 2016). This
marketing strategy provide privileged to rich class people for hiring private jets and facilities
during their travelling in national as well as international level.
Segment marketing aims in grouping audiences who have similar preferences or demands and
possess common aspects (Sheth and Sheth, 2017). This is the most common strategy which is
adopted by every airline company in order to maintain their market positioning.
Similarly, segmentation of target market is divided under 4 divisions such as- psycho-
graphic, demographic, geographic and behavioural aspects. These factors showcase firm’s
viability, accessibility and its measurability. For generating demand of potential consumers every
business organisation focusses on analysing their preferences. These are further decided under
sub parts – clusters, homogeneous and diffused (Wassmer, Pain and Paquin, 2017).
Under diffused preferences every consumer follow high or different tastes and demands
whereas homogeneous factors determined zero or little differences in their target segment needs.
Clusters are formulated within needs and preferences of target buyers under clustered segments
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(Conrady, 2016). However, Thomson Airways is recognized as a high-quality service provider
under airline hub. Focuses on providing best services towards clustered segments of individuals
relevant to their requirements and demands.
Targets of Thomson Airways.
Every business organisation maintains a policy of targeting desire customers to easily
identify their needs and demands for present as well as future situations. They can further target
their consumers on the basis of marketing under single product, marketing different segments
with different products, targeting same market by providing them set of products, same product
is being marketed under different segments or huge range of products are marketed under every
target segments (Lee, Wilson, Pasurka and Managi, 2017).
Thomson airways offers several packages of services to different consumers by following
single segment strategy (Wassmer, Pain and Paquin, 2017). They further provide best services to
different consumers under four stages that is: premium, executive, economy and first class.
In addition, this company adopts the marketing mix strategy to target most suitable
consumers for enhancing their market positioning. This can be executed under eight types such
as – mono segment, multi segment, anticipatory, standby, imitative, defensive and stop gap
(Piwek, Piwek, Wiśniowski and Wiśniowski, 2016). Cited airline company aims in fulfilling
every factor under marketing mix to provide overall satisfaction to their target buyers. For
positioning airline industry, it is important to focus every marketing elements to deliver the best
service among consumers and creates competitiveness within its substitutes.
Further, Thomson airways has established 'Discover Your Smile' slogan that indicates its
desire to attain a global reach of its airlines by satisfying its buyers. Several marketing channels
such as- advertising, publicity, media, sponsorship, events and other charitable functions have
been conducted by cited company to ensure its awareness among potential buyers (Stroebel,
2016). Similarly, they focus in conveying efficient information related to its activities and
actions that enables individuals from different segments to travel among them. Therefore, studies
have identified that cited firm has attained huge competitiveness among its rivalries.
SUPPLY CHAIN MANAGEMENT: - Thomson Airways carry a unique set of tools and
capabilities to manage price risk and screen as a third-party supplier, giving the requirement to
confidently and effectively manage supply chain (Conrady, 2016). On the other hand the
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logistics department of both large and small businesses, that executives do not see any software
like transportation management systems software.
Manage logistics and freight risks: - The company manage logistics and freight risks
for running their business with effective and efficiently in this competitive marketing
environment.
MARKETING: - As the UK's leading relaxation travel retailer, the most important
product for Thomson is its service. The using their services as a key tool for attracting new
customer and maintaining its image in the market by providing better service to the customers.
After that the good market segmentation, Thomson provides particular travel and relaxing plans
for specific group of customers (Brubaker and Coss, 2016). From adoption of this marketing
strategy the company not only satisfies these loyal customers but also could attract more new
customer. For e.g., different price offers to the different economical groups. Its offers different
price according to the income level of the client. While, Thomson expands it financial gain. Its
divides purchaser into group based on their knowledge, attitudes, uses, or responses to a product
or service. Some people more prefers the travel shopping in metropolis.
HR Practices: - The company continually being challenged to create the sort of
experience that customer demands. Nowhere is more visible than in Darwin, our benefits
management and top service providers. Its makes easy and enjoyable working environment for
employees to connect their flexibility and voluntary benefits with their huge scopes (Elliot,
Elliot, Khazaei and Durand, 2016). The company provide training for the new joins. Its provides
medical and other benefits for the employee. Thomson Airways more concern on work and
customer satisfaction, the top management and HR department always guide their gives training
and suggestion for higher customer satisfaction and better services to the client.
Porter's Five Force of Thomson Airways: - In order to analyse the industrial
environment of Thomson Airways and evaluate the nature of the competition faced by the
company, this essay uses Porter's five force tools developed by porter's.
Competitive rivalry: - The competitive rivalry in airline sector has been rise specially
through mergers and acquisitions. Moreover, new rivals have emerged following the footsteps of
Thomson. Present time Easy jets and south-west is the closest competitors of the Thomson.
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Entry Barriers: - There are high barriers to entry this sector as it needed a huge initial
capital investment (Tan, Nie and Baek, 2016). Entry with low profit margins, it has very difficult
for new market competitor because very company comes into market for earning profit from the
market and establishing own self.
Threat of substitutes: - In this industry there many of the substitutes in term of long
distance travel like cars, trains, ferries and all these are cheaper than compare to airlines.
Moreover, air travel has the absolute advantage in term of saving time. Therefore, relatively low
threat of substitutes in this industry (Erevelles, Fukawa and Swayne, 2016).
Bargaining power of suppliers: - Thomson Airways is largely depends on price of oil
for its profits margins, which implies high bargaining power of oil suppliers. The company
primarily utilized regional airports and neglects huge and expensive international airport (Lord,
2016).
Bargaining power of buyers: - In this industry high bargaining power of customer
because they have wider scope in this sector with different- different prices and services
(Miyoshi and Ibáñez, 2016).
Firms competitive advantages.
Thomson airlines formulates its strategies and competitive factors according to the
services provided by them. They further analyse their positioning by comparing with the services
generated by its competitors. They aim in achieving return on investment of approximately of
15%. For enhancing its competitiveness, they have adopted the latest technologies by providing
on board Wi-Fi facility and digitization to entertain travellers during their long hour journey (Fan
and Lingblad, 2016). Their primary goal is to enhance aggressive expansion of its industry by
conducting a dozen of routes and aids in eliminating every possible obstacle coming under their
destination (Fan and Lingblad, 2016).
They merely focus over personalisation of services to create high standard among their
potential buyers. Another major factor of their competitiveness is generating variety choices such
as- wide range of different taster food, healthy breakfast, toys for children, access for Bollywood
or Hollywood movies or other digital activities, world traveller cabin and many more (Stroebel,
2016). They are further developing their integration and access over new technologies to enhance
its business undertakings and provisions of services.
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Thomson Airways market competitors.
Every industry faces huge amount of competition and threats among its substitutes.
Therefore, Thomson Airways are threatened mainly by United airlines because they merely
follow similar strategy and concepts to fulfil needs and preferences of their target buyers. In
addition, both of the industries are targeting similar buyers and aids in providing them with
complete satisfaction as well as comfort (Messner, 2017). Not only this, cited company also
consists of several competitors such as- British Airways, Virgin Atlantic Airline, British
midland, Lufthansa, Emirates Airlines and Jet Airways.
Cited company follows effective pricing strategy by providing combination of flight seats
along with comfortable hotel rooms under economic rates. Such strategies attract numerous
passengers and attain competition among its rival firms (Dziedzic and Warnock-Smith, 2016).
Studies have generated that Thomson airlines attracts large scale sales and merely about 40% of
it is developed from online websites. Therefore, cited industry attains flexibility under its pricing
strategy. For example, increase its rates during high demand and reduces at low demand.
UK government has identified Thomson Airways as the leading firm under airline sector.
However, it flies to 80 destinations in 40 countries. Strong brand image as it is the oldest aviation
entity. They follow excellent advertising and marketing strategy. Nearly 10 million passengers
are carried annually (Conrady, 2016). Thomson airways can contract with corporations for
mutual benefits. Tie-ups with hospitality industries can enhance international tourisms. Adoption
of new technologies has availed its expansion among different segments.
Hence, above discussion showcase that Thomson airlines have high competencies and
numerous strategies to enhance its productivity among competitors.
Marketing Strategies of Thomson Airways
Effective marketing is the key to attain maximum profitability and being the most
competitive sector, airlines industries are required to pay more attention on advertising methods.
Thomson Airways can take assistance from effective marketing techniques to enhance its
business value (Lord, 2016). Some of these strategies which can be followed by the organisation
are as follows:
 Social media marketing- Nowadays, the biggest platform for advertising of the services
is the social media. Thomson Airways can take advantage from different features of
social media such as Facebook, Instagram, E-mails, etc. (McDonald and Wilson, 2016).
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All these networking sites are accessed by large number of people and thus, presenting
ads on these stands will cover more range. Branding- This is a full-proof technique that guarantees the increment in the sales.
However, great efforts are required in creation of the image. In context to the Thomson
Airways, branding is the matter of advantage (Erevelles, Fukawa and Swayne, 2016).
The renowned name in the aviation industry makes it stand out of the rush. Thus, entity
can use its brand image as promotional tool. Featuring distinct and luxurious facilities: The emphasise of entity that is given to the
latest information and electronic technology can be included as a marketing tool. In
addition to this, the focus on the amenities like comfort, safety, customer service, etc.
can be used (Wild, Murray and Baxter, 2016). Tie-ups with famous hospitality industries: This is the majorly used method that enhance
the efficiency of marketing with minimum efforts. In this, the organisation may tie-up
with popular hospitality groups so that whenever the hotel will advertise for the package
it will include the name of entity as transport partner (Erevelles, Fukawa and Swayne,
2016).
 Loyalty Programmes: These types of events conducted by the aviation industries
encourages customers to take the ride again. For this, entity can charge similar fares for
the identical trips (Miyoshi and Ibáñez, 2016). Also, rendering consumers with the
facilities such as Wi-Fi, beverages, etc. can help in gaining their loyalty.
Present position of the entity in market.
Thomson Airways has started in 1965 and till now the entity has gained a renowned
aviation industry tag in the transport business and ancillary service (Miyoshi and Ibáñez, 2016).
According to the recent data, it has been observed that the total revenue of Thomson Airways In
2016 was 1,920,411 pounds by riding 10,942,651 passengers. The large group has 16,000
employees in its operation. Besides the most challenging period for the airline sector due to
variations observed in the fuel prices, growth in competition and market capacity, UK's exit from
EU, etc. the entity has performed well in the aviation market. The group continues to extend the
network further by introducing 20 new destinations (Lee, Wilson, Pasurka and Managi, 2017).
Thus, in present time, Thomson is travelling people to 80 destinations of 40 different countries
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(Thomson Airways Ltd's passenger cargo uplifted in the United Kingdom (UK) between 2008
and 2015 (in metric tonnes) *, 2015). In addition to this the entity broke previous records of
earning maximum operating profit. Also, it is announced at largest entity based on the revenue
collected and have the biggest brand image. It may be recognised that the condition of the
organisation before 10 years was something else. There is large increment in the revenue
collected of present time to that of 2007. It is because the living standard of people has been
raised (Sengur and Sengur, 2017). Further, the aviation sector was not affordable by everyone at
that time and this thing highly impacted in context to the profitability. However, the brand image
of the entity is same as present time. The major competitors of the organisation are easy Jet,
British Airways, Virgin Atlantic, British midland, Lufthansa, etc. Thomson Airways is trying to
keep their good position in the market on the basis of their renowned name in the aviation sector.
The entity further provides high class facilities to the customers to satisfy their needs and
demands. Also, it has tie-ups with famous hospitality industries that highly contributes in its
profitability (Sherman and Sherman, 2017). The easy availability and accessing facility provided
to the consumers also aids in their accountability. Moreover, complete holiday packages
promoted by the entity makes them stand out of all the competitors. However, because of the
factors such as strong backing of UK government, large international destinations, excellent
marketing and advertising makes it Thomson Airways leading player among all.
CONCLUSION
From the above study, it has been concluded that for enhancement or expansion of
Thomson Airways appropriate segmentation of market, positioning, analysing potential buyers
and their preferences are very crucial to be determined. Further, the facilities that are been
provided by the entity to the consumers are good enough to make their name more powerful. In
addition to this, the CSR responsibilities of the Thomson airways also attracts a large mass of
people in taking the services. The way of organisation in using its strengths to grab the various
opportunity's is recommendable. Moreover, the pricing strategy, logistic management, etc. helps
the organisation in receiving maximum revenue. I have identified that cited airways would
generate more competitiveness among future as leading holiday flying airline. Further it would
cover large destinations by providing the best comfortable journey.
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REFERENCES
Books and Journal
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carrier business models: The European case. Research in Transportation Business &
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transformation of marketing. Journal of Business Research. 69(2). pp. 897-904.
Fan, T.P.C. and Lingblad, M., 2016. Thinking through the meteoric rise of Middle-East carriers
from Singapore Airlines' vantage point. Journal of Air Transport Management. 54. pp.
111-122.
Lee, B.L., Wilson, C., Pasurka, C.A and Managi, S., 2017. Sources of airline productivity from
carbon emissions: an analysis of operational performance under good and bad outputs.
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Lord, K., 2016. Negotiating Identity: The Christian Individual and the Secular Institution.
Entering the New Theological Space. pp. 127.
McDonald, M. and Wilson, H., 2016. Marketing Plans: How to prepare them, how to profit from
them. John Wiley & Sons.
Messner, W., 2017. Does Value for Money Create Advocates? A Study in the International
Airline Services Industry. Journal of Global Marketing. pp. 1-13.
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country airlines? An empirical analysis of Kenya Airways with an aircraft appraisal
cost–benefit analysis model. Transport Policy. 47. pp. 41-54.
Wassmer, U., Pain, G. and Paquin, R.L., 2017. Taking environmental partnerships seriously.
Business Horizons. 60(1). pp. 135-142.
Wild, G., Murray, J. and Baxter, G., 2016. Exploring civil drone accidents and incidents to help
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Online
Thomson Airways Ltd's passenger cargo uplifted in the United Kingdom (UK) between 2008 and
2015 (in metric tonnes)*, 2015. [Online]. Available Through:
<https://www.statista.com/statistics/309489/thomson-airways--uk-passenger-cargo/>
[Accessed On 8th September 2017]
About Thomson Airways, 2017. [Online]. Available through:
<http://www.thomson.co.uk/destinations/info/about-thomson>. [Accessed on 8th September
2017].
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