Strategic Management Report: EasyJet's Growth Strategies

This report provides a comprehensive analysis of EasyJet's strategic management, focusing on key directions for future growth and specific strategies. The report begins with an introduction to strategic management and its relevance to EasyJet, a low-cost airline. It then delves into the application of Porter's Five Forces to assess the competitive environment, followed by a SWOT analysis to identify the airline's strengths, weaknesses, opportunities, and threats. The report also explores the Ansoff matrix to evaluate growth strategies like market penetration, market development, product development, and diversification. Furthermore, it highlights diversification strategies, particularly in the context of economic recession, and the importance of market research in supporting these strategies. The report concludes by summarizing the key findings and emphasizing the benefits of strategic management for EasyJet's future growth and market success.

STRATEGIC
MANAGEMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
1)Key direction for future growth of Easyjet..............................................................................1
2)Particular strategy going forward for future justification.........................................................4
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Strategic management is the tool or method to make effective strategies through which
business can grow and can meet its goal. . EasyJet is taken for this report, It is a British company
which categorises in low-cost airline and their headquarter are situated in London. This report
highlights the key direction for the future growth of Easyjet and also shows the particular
strategy that going forward for future need(Ansoff and et.al., 2018). In this regard present report
has been prepared that involves discussion over strategic management.
1)Key direction for future growth of Easyjet
Porter five force
It shape the strategy to make it effective so that they have an significant impact on
profitability of the company. It is framework of holistic strategy that helps in taking decisions
strategically that is away from analysing the competition. The five forces of porter are -
Threat of new entrants
Airline sector is too wide and it is impossible for new firm to create threat for already
existing firms hence EasyJet needs not to worry about it (Moutinho, and Vargas-Sanchez, 2018).
Easyjet company can overcome such problem
Company start invention as it may brings new buyers to fold bit also provide also old
customer an reason to purchase products. And by building economic scale that can lower the fix
rate per unit and also try to build capacity & spending funds on research and development
department.
Suppliers Power
Power of suppliers are moderate, as there are limited number of suppliers those who
supply material to such airline companies. If suppliers enhances cost then it would affect pricing
of tickets and consumers may not take interest in such high cost products (Noe and et.al.,
2017)..
Easy jet Company can build efficient supply chain for various suppliers so that company
have more option for supply instead of depending on one. And by doing experiment with the
product decision by using unique materials, it would be helpful in remaining in competition
Buyers Power
Customers are the most important part of business, they have high power because if they
are not happy then they may switch the firm. This will disturb the profitability of Easy jet in long
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run. igher the bargaining power of consumer and if its larger their ability that seek to raise
discount and offers.
Easy jet company can counter the bargaining power of Buyers
As company builds the large customer base. It controls over consumer’s power consumer
as well as proved an opportunity to form streamline that boost the sales & production process
and also quickly bring innovation in the market
Substitute product’s threts
If same kind of services are available in market then consumers may move towards it
(Ethiraj, Gambardella and Helfat, 2016). The threats of substitute service or product is more if
offers an value that is way unique from current offering of industry.
Easy jet can overcome of substitute service/products
By just being an product oriented it should be an service oriented. And also try to
understand the requirement of the buyer rather than what an consumer is purchasing and provide
service according to the desire of the buyer. Also try to switch the rate of consumer.
Competitors power
British Airways etc. many firms are available those are offering amazing services to wide
range of consumers. There power is high because they can influence the profit of company by
making changes in their pricing strategies.
Company can handle and counter measures taken by intense rival among existing competitors.
There is option to merge with them or make partnership which will be helpful in generating
more sales and raising market share as well.
SWOT
Strength
Easy jet has good brand reputation and it is low cost flights in UL, specially among
business people and travellers. It is trustworthy on travel services and giving value added
services and it is known for friendly customer service. Clear CSR that geared towards reducing
company impact on environment. Having more modern plans to ensure safety and
reliability(Bryce, 2017).
Weaknesses
Airlines which are less in price are competition and fighting for customers is always lead
to price war. It is difficult for the company to keep strategy up due to over cost. Easy jet is not
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providing no cost food services on an long term duration flights and customer find difficult on it.
As it take young rowdy traveller that is not like by the older traveller.
Opportunities
Business travellers provide an essential opportunity to the airline. It looks for strategic
partnership with an airport that help to expand the ways of routes and it will take more time for
travel according to the choice if its customers. Business section focuses on, continuous travel that
will less influence in changing the economy.
Threats
Slow down bookings is a problem for an Easyjet in terms of lowering the revenue and
profitability of the company and as increase in the the price of the fuel and other cost such as
environmental expectation, economic recession, airport fees etc. that reduce the number of
flights and increase the cost of passengers. Such threats create the Easy-jet
sustainability(Michael, Storey, and Thomas, 2017).
Ansoff matrix
This is the direction of business that helps in evaluating the growth planning of the firm.
For example Easyjet targeting the business traveller with low cost and frequent flights to an
popular destination. Ansoff matrix has four strategies which are.
Market Penetration
This tactics states that enterprise has option to work in existing market and sell existing
products only. As familiarity in the current market is high hence chances of generating profit is
also high. But firm may fail to deal with new buyers.
Market Development
It is searching of an additional section of market. Developing a new market. As EasyJet
can enter into new country and can deal with foreign consumers. This will develop brand image
and will raise sales as well. But risk is also high in this tactic hence EasyJet has to take care of it
and has to ensure that it does not face huge loss (Hill, 2017).
Product development
This is another tactic that suggests to develop products or offer new services to potential
buyers. It may give benefit to Easyjet in attracting more consumers. But it may enhance
operational cost as well. But there are high chances of raising profit.
Diversification
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Enterprise can develop products and market both, by this way it would be able to attract
new consumers and raising its brand image as well..
2)Particular strategy going forward for future justification
Diversification strategy is the key to the recession survival for the Easy jet company has
put the recession which have negative impact on many types of business.. This is more likely to
spread across no. of sectors(Meyer, Neck and Meeks, 2017). At the stage of recession, small
business will look at the source for diversity to an new areas and market
New offering – By offering wide range of products to consumers EasyJet can gain
attention of mass audience and can satisfy them towards the brand. This is the tactics which will
help business in managing cost and generating profit in business unit. Company has option to
offer meal services and accommodation facilities to buyers which will make them happy and
they will retain in firm. Furthermore, it would attract such buyers as well those who want
budgeted travel.(Ginter, Duncan and Swayne, 2018).
Another way to diversify the business in an different source. For example – If the shop own at
the high street than the owner can look at weather it can sell the things on internet is feasible
option. By providing offering to the customer the buyers may attract by seeing the offers and try
to buy or take the advantage of the offer that is provided by the company and Hence which
increase the sales rate or revenue of the Easyjet company. And Hence it increase the profitability
of the company as compare to the other competitor in the business market.
Research- Market research is an vital role for an successful business diversification
strategy. It help the Easy jet company to understand the new customer base, and also help to find
out more and more competition that can give an ides. Whether the new services and product can
work in the market or not. Some companies are fail to achieve the goal or its objectives, poor
research can create problem for company and it may fail to offer satisfactory good to consumers
(Ethiraj, Gambardella and Helfat, 2016). By making research company need to be identify the
need and desire of the customer and accordingly the company try to take decesion. So that can
fulfil the desire of the customer needs like if the booking of the company goes down it conduct
the research and try to find out the appropriate reason behind of lowering the booking and
accordingly took step and offers or discount to the customer that may raise the booking of Easy
jet. And also try to keep eye on the competitor and what strategy is using to attract the customer.
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Diversification tactic: It should enter in to new market with completely new products
and services, Easyjet is low cost airline which focus on offering services at affordable prices. If it
goes into new market then people will like this type of airline services and they will prefer to buy
it. Easyjet has to modify its products and have to add accommodation facilities, luxurious
services with them which will gain attention of people those who want luxurious travel. This will
help in making them satisfy as well (Lasserre, P., 2017).
Make more money- It can gives more monetary benefits to its potential buyers. If the
company can enter into the joint venture or enter in other companies it may increase it profit,
borrowing and cash flow.
CONCLUSION
Study can be summarised as strategic management is considered as beneficial tool for
the Easy jet company it helps the company for the future growth and find out various ways by
which it can expand its business in future. Market research also plays an important role as before
making any investment comp[any will do market research so that it can invest for a profitable
result. The study also concludes that by the the products development the quality of product will
increase and hence it will assist in increasing the sales of the company.
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REFERENCES
Books ans Journal
Ansoff and et.al., 2018. Implanting strategic management. Springer.
Bryce, H.J., 2017. Financial and strategic management for nonprofit organizations. Walter de
Gruyter GmbH & Co KG.
Ethiraj, S.K., Gambardella, A. and Helfat, C.E., 2016. Replication in strategic
management. Strategic Management Journal, 37(11), pp.2191-2192.
Ginter, P.M., Duncan, W.J. and Swayne, L.E., 2018. The strategic management of health care
organizations. John Wiley & Sons.
Hill, T., 2017. Manufacturing strategy: the strategic management of the manufacturing function.
Macmillan International Higher Education.
Lasserre, P., 2017. Global strategic management. Macmillan International Higher Education.
Meyer, G.D., Neck, H.M. and Meeks, M.D., 2017. The entrepreneurship‐strategic management
interface. Strategic entrepreneurship: Creating a new mindset, pp.17-44.
Michael, S., Storey, D. and Thomas, H., 2017. Discovery and coordination in strategic
management and entrepreneurship. Strategic entrepreneurship: Creating a new mindset,
pp.45-65.
Moutinho, L. and Vargas-Sanchez, A. eds., 2018. Strategic Management in Tourism, CABI
Tourism Texts. Cabi.
Noe, R.A., Hollenbeck, J.R., Gerhart, B. and Wright, P.M., 2017. Human resource management:
Gaining a competitive advantage. New York, NY: McGraw-Hill Education.
Online Reference
SWOT Analysis of Easyjet Airline Company Limited | Business Teacher .2019[Online]. Available
through <https://businessteacher.org.uk/swot/easyjet.php>
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