Systematic Strategic Analysis on Virgin Atlantic

Running head: SYSTEMATIC STRATEGIC ANALYSIS ON VIRGIN ATLANTIC
Systematic Strategic Analysis on Virgin Atlantic
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1SYSTEMATIC STRATEGIC ANALYSIS ON VIRGIN ATLANTIC
Executive summery
The report examines strategic capabilities of one of the eminent British airlines, Virgin
Atlantic with the help of various strategic tools as the company is on the verge of expanding
its new Asian routes, connecting Singapore with London and various European destinations.
In order to do that given report has been evaluated the company’s potential to execute the
plan. At first, macro environmental factors have been analysed following the PEST model.
Then, after a brief description of micro environmental factors, porter’s five forces analysis
has helped to understand the power of suppliers, buyers and competitors.
Bowman’s strategy clock model has suggested appropriate market positioning for the
company considering the nature of expansion. Then SWOT analysis model has helped to
elaborate its strategic capabilities by analysing its strengths and opportunities and sheds lights
on the threats and weakness, which must be recovered in order to implement the plan
successfully. Finally, with the help of strategic tools, the strategic directions of the company
have been identified and promotional strategies have been suggested to accomplish the
organizational goal of new market and service development. This report can be a guideline
for the airline companies, which are interested to expand their business based on the
perceived value and customer loyalty.

2SYSTEMATIC STRATEGIC ANALYSIS ON VIRGIN ATLANTIC
Table of Contents
Introduction....................................................................................................................4
Background of the company..........................................................................................5
Reason behind revising the strategic approach..............................................................5
PEST analysis of Virgin Atlantic...................................................................................5
Political factors...........................................................................................................6
Economic factors........................................................................................................6
Socio-cultural factors.................................................................................................7
Technological factors.................................................................................................7
Micro-environmental analysis........................................................................................9
Porter’s five forces analysis.........................................................................................10
Market positioning: Bowman’s strategy clock............................................................13
Position 1st: low price-low value.............................................................................13
Position 2nd: low price.............................................................................................14
Position3rd: Moderate price and moderate differentiation......................................14
Position 4th: differentiation......................................................................................14
Position 5th: focused differentiation........................................................................15
Position 6th: standard product/ increased price.......................................................15
Position 7th: low value/ high price...........................................................................15
Position 8th: low value/ standard price....................................................................16
SWOT analysis: evaluation of capabilities..................................................................16
Strengths...................................................................................................................16

3SYSTEMATIC STRATEGIC ANALYSIS ON VIRGIN ATLANTIC
Weakness..................................................................................................................17
Opportunity..............................................................................................................18
Threats......................................................................................................................18
Strategic management tools.........................................................................................18
ANSOFF’s growth matrix model.............................................................................18
BCG matrix model...................................................................................................19
Blue ocean strategies................................................................................................21
Marketing strategies.....................................................................................................21
Conclusion....................................................................................................................23
References....................................................................................................................24

4SYSTEMATIC STRATEGIC ANALYSIS ON VIRGIN ATLANTIC
Introduction
The purpose of framing this strategic report is to understand the potential of a British
airline company, Virgin Atlantic, was founded in the year of 1984, as the authority is
planning to expand routes connecting Singapore to several European destinations. In order to
do that management needs to produce a strategic report and based on that future agenda will
be planned. This report will be made with the help of several strategic tools to evaluate how
capable the company is to execute the plan by receiving assistance of existing resources and
current market position.
At first, a brief description of the company will be given and after that, the reason
behind their decision to consider a strategic approach will be elaborated. As the company
wants to deal with one of the most busiest and popular travel destinations Singapore,external
forces will be revised by presenting PEST analysis followed by an analysis of micro
environmental factors. Then, porter’s five forces model will be appropriate to understand the
competitive position of the airline company within industry. Bowman clock will further help
to determine its market position and elaborate the reasons behind it. Finally, presenting a
SWOT analysis the report will shed light on the strengths and weakness of the company.
Based on that its market opportunity and threats will be examined. By adopting strategic tools
like ANSOFF, BCG and Blue Ocean model, a systematic analysis will be presented to frame
the strategies of gaining competitive advantage in the market for their new expanded route
(Homsombat, Lei and Fu 2014).
This assignment is about evaluating several marketing components. Therefore,
presenting a strategic report, which will work as a guideline for the company while executing
future strategies of route expansion connecting Singapore with some of the busiest
destinations of Europe.

5SYSTEMATIC STRATEGIC ANALYSIS ON VIRGIN ATLANTIC
Background of the company
Virgin Atlantic (VA) was established in 1984 with the former name of British
Atlantic Airways with its headquarter in United Kingdom. It deals with destinations of North
America, Africa, Middle East and selected destinations of Asia from its central base situated
in London, and secondary based which is in Manchester. It is operating business with a
strong brand name because of its fair corporate image, which has been made out of thirty-four
years of excellent service. The quality of the services are worthy for purchasing to experience
a premium journey. These are the reasons, which have made the airline company branded,
travel friendly for the consumers and one of the most recognised and respected brands within
the industry and across the world as well.
Reason behind revising the strategic approach
As the airline company has been experiencing significant growth in business since
years, the authority has decided to explore the opportunity of further expansion of routes
concentrating on the interest of both the Singaporean and European customers. From the year
of 2020, the flights will be on-board to maintain the commitment according to the plan.
Enhancement of the routes will be announced at the end of the 2019, if before that the
management could frame the appropriate strategies for this expansion (Dalby et al. 2014).
Regarding this important agenda, authority has decided to take a serious strategic approach
considering several strategic tools of business.
PEST analysis of Virgin Atlantic
The purpose of PEST analysis is to present a framework of macro environmental
factors, which are used to evaluate the potential of business environment when the company
is in need of a strategic approach.