Strategic Management Case Study: Analyzing Easyjet's Strategies

This case study provides a detailed analysis of Easyjet's strategic management, examining its business operations as a low-cost carrier. It begins with a background of Easyjet, followed by an external environmental analysis, including political, economic, social, and technological factors impacting the airline. The study then assesses Easyjet's major competitors, such as Ryanair, Wizz Air, and Norwegian, using Porter's Five Forces framework and a comparative table. An internal strategy analysis, including a SWOT analysis, is presented to evaluate the company's strengths, weaknesses, opportunities, and threats. The case study also explores Easyjet's strategic choices, including building a strong network, cost advantages, operational excellence, digital integration, revenue growth, and human resources. A critical evaluation of these strategies and future recommendations are provided, concluding with a discussion on the challenges and opportunities for Easyjet in the market.

STRATEGIC MANAGEMENT: Case study easyjet

Table of contents
Background Easyjet.........................................................................................................................3
External environmental analysis of Easyjet Airline........................................................................3
Competitor Analysis: (3 major direct competitors to easyjet).........................................................6
Internal strategy analysis :( SWOT analysis)................................................................................10
Easyjet’s strategic choices and future strategic trajectory.............................................................11
A critical evaluation on the selected future strategy for easyjet....................................................12
Conclusion and Future Recommendations....................................................................................12
Bibliography..................................................................................................................................14

Background Easyjet
Easyjet is a British Airline company which operates their business under low-cost carrier model.
Easyjet has adopted different strategic plan for expansion of their business since its
establishment in the year 1995 (easyJet.com, 2017). It operates in both domestic and
international route in more than 30 countries. The organization took strategy to develop strong
position in leading airport of European market. Easyjet offer their customer a better service
within affordable fares. Keeping the fare low is one of the main strategies which are being taken
to give a tough competition to all the leading competitors in European market. In order to keep
the fare low , the airline authority have taken few excellent strategy such as increasing number of
seat per aircraft which automatically helps to gain the expected profit. Along with that easyjet
ensure to keep the maintenance cost low for earning maximum amount of profit. This report
assesses different strategies which are being taken by Easyjet for business development. Further
it discuss about the internal and external factors which are impacting the business of easyjet
Airlines.
External environmental analysis of Easyjet Airline
Macro environmental analysis of Easyjet will help the organization to understand it position in
the market. There are four factors which will be discussed under the external environmental
analysis and those are Political, Economic, Social and Technological factors.
Political Like many other British airline company in
the year 2016 Easyjet faced a very
challenging political year. This had a very
strong impact on their business environment
as well. The planned exit from EU has
impacted much industry which includes
Easyjet. Leaving EU has changed the shape of
British economy. Especially airline have been
majorly influenced by the decision of taking
an exit from EU, since major intra-European
routes has significant base in EU. Those

routes were major resources of revenue
generation of most of the British Airlines. As
a result Easyjet has to come up with new
strategic plan.
Since most of the intra European routes are
part of EU countries hence in order to
maintain business either Easyjet had to change
its headquarter to some EU country or had to
sale their business to some EU nationals in
order to retain rights to fly cities likes , Rome
to Berlin (Sampson, 2017).
This political change has a greater impact on
the business of Easyjet as most of their routes
are based in EU nationals.
A positive political change which was indeed
a great new for Easyjet business approval of
Heathrow runway as the third runway.
Easyjet understand that expansion of third
runway will directly help their low cost
business patter once the government of the Uk
chooses to expand the capacity of the
Heathrow Runway. Therefore , impact of
external political factors are visible on the
business of Easyjet Airlines
Economic The uncertainty following EU exit has
economically impacted Easyjet and many
more airlines. The annual report of Easyjet
suggests that the depreciation of pound
sterling has negative influence on the business

and company incurred a loss of £112 million
in foreign exchange (easyJet.com, 2017).
Through Easyjet has managed to earn profit in
foreign currencies. Though low fuel price and
interest rate worked well for the business of
Easyjet Airlines (Williams, 2017).
Social Summer of 2016 which is considered as the
peak season for airlines have created impacted
by air traffic controller strike in France. These
ATC strikes in France over labor reform have
forced Easyjet to cancel many flights. It was
difficult for Easyjet to utilize the summer time
as most of their routes are France Based.
Although Some leading airline like British
along with Easyjet have already submitted
petition to French government and EU to
build some action plan which helps to reduce
ATC strikes.
Technological Easyjet is currently facing digital interruption
after stability following 911. A digital
revolution has been found in airline industry
where many leading airlines are offering
digital platform to customers (Peppard &
Ward, 2016). This not only reducing the cost
to the company but also making the journey
comfortable for passenger. Passenger does not
have to present physically to complete check-
in process. Technological changes have
worked well with the low cost business
strategy of Easyjet and hence Easyjet

continues to invest in technological
modification to keep their fare low and
affordable for customers.
Competitor Analysis: (3 major direct competitors to easyjet)
Analysis of competitor’s strength is important for any business to formulate any business
strategy. There are many competitors who are able to give tough competition to Easyjet airway,
such as Ryanair, Wizz Air, and Norwegian. These four airlines are part of pan Europe low cost 5
airlines ( PELOCO5). Porter’s five tools have been used in order to analyse the competition level
of Easyjet in the market.
Threat of new entrants: Easyjet has less amount of threat from the new entrants as British
government have been managed to establish strict rule to enter into airlines market. One of the
main constraints for any new entrant is the high cost in airline business. New companies need to
invest large amount of money in order to complete set up to run an airline business. Another
barrier to enter into this industry is accessibility of the distribution channel which is often
restricted. Most of the airport slots are given on long time lease or contact, so it is difficult for
any new company to find a slot in the airport.

Figure: Porter’s five Forces
Sources; Created by author
Threats of substitute: Considering the substitute product there is not much number of
substitutes available for Easyjet airway. There is no other alternative to travel long distance with
short time (Holloway, 2017). The only substitute is high speed train, however the ticket cost of
high speed train are higher than Easyjet air tickets. Therefore it can be concluded that consumer
have limited options to choose a service as substitute.
Buyer Power: Individual buyers have low bargaining capacity as most buyers buy air tickets in
low quantity. The bargaining power of buyers is comparatively. Presence of different
competitors gives an opportunity to the buyer to switch their option for low cost tickets.
Supplier power: There are only two aircraft producer companies in market (Airbus and Boeing)
hence they hold a strong power in the market. Easyjet however have an option to switch supplier
to retain the low cost.

Degree of rivalry: Presence of many rivals within the market increases the degree of rivalry
among airlines. Considering the market structure much airline company are changing and
adopting low cost as their new business strategy.
Elements Easyjet Ryanair Wizz Air Norwegian
Price Air fare of these
airlines are
almost similar, it
only varies on
the distance
traveled by the
passenger and
facility availed
by customers
Facility Easyjet allows
passenger to
carry luggage
bag , 15 kg
(Hand bag ) and
32 Kg checked
in bag
Cabin bag should
not be more than
10 kg , however a
baby bag (5kg)
can be carried
with the normal
cabin bag
(Ryanair.com,
2017)
Wizz Air allow
to carry
passengers, a
luggage of max
10 kg (Hand
luggage ) and
32 kg checked
in bag (Wizz
Air, 2017)
Maximum 10 kg
cabin bag are
allowed to carry
inside the cabin
which may go
upto 15 KG in
case of higher
ticket price
Customer
satisfaction
Customer
satisfaction rate
is 6/10 according
to a well know
review site.
6/10 5/10 6/10

Further
according to the
latest annual
report the
customer
satisfaction
percentage of
Easyjet is 72%.
Therefore still
there is scope to
improve
customer care
service for this
Airline.
Table: comparison of Easyjet with three leading airline in the market
(Source: Created by author)

Internal strategy analysis :( SWOT analysis)
Strengths
● Pricing in one of the biggest strength
of Easyjet. In short distance route their
ticket price is 50% lower than other
major airlines.
● Easyjet kept a sustainable unit cost as
one of their main business strategy
● It has a presence in top 49 market pairs
in Europe. It put Easyjet within the
reach of maximum number of
European passenger
● For the past few years Easyjet have
been able to manage a good reputation
in the market, therefore created brand
awareness among the passenger.
Weaknesses
● Although Easyjet has unit cost
advantages over most of the
companies but not over Ryanair. This
is one disadvantage for the company.
● Easyjet has better brand value than any
other LLC competitors however the
overall brand image of LCC
competitors are poor compared to
legacy carriers
● Dispute within the management of the
last few years have impacted the
overall brand value of Easyjet
Opportunities
● Considering the current market
condition aviation industry have a long
term medium growth rate, being one
of the significant airline Easyjet have
an opportunity of growth in market.
Threats
● Easyjet operate their service in many
major airports within Europe and most
of those airports enjoy price increase.
This works as the biggest threat to the
business.
● Airline business in vulnerable to labor
unrest. In fact labor unrest can be
evident among both internal and
external staff.
● Fuel price hike and currency

movement is working as threats to the
company.
Easyjet’s strategic choices and future strategic trajectory
Easyjet have been able to develop their internal business strategy which is able to drive growth
and returns for the shareholders.
Figure: Business strategy of Easyjet
Source:
Biggest competitor of Easyjet is legacy airline and charter carrier. In order to gain competitive
advantages over the rival Easyjet have taken low cost strategy which help customers to pay low
and affordable price (Hill & Jones, 2012). Easyjet has six strategic pillars to deliver its strategy.
● Building strong network
● A lean cost advantages
● Operational and customer excellence
● Digital and data
● Grow revenue

● Best people
Easyjet have taken the strategy to operate through key airport which is frequently being used by
both leisure and frequent traveler. The organization ensures that they create a network on airport
which is a part of top European markets. Apart from that easyjet has targeted time slot which is
customer friendly time slot or peak slot for the airport. This organization has a target to obtain a
secure position in France for future market growth.
Another strategy which is being taken by easyjet is to provide a sustainable low cost fare against
cost inflation. This secure more number of customer for the business that any competitors.
easyjet has taken the strategy to reduce the interruption time to increase customer satisfaction
rate among customers. Digitalization of business is another important strategy which is being
taken by easyjet to gain future growth in the market.
As a part of the future revenue growth, easyjet has taken strategy to build relation with corporate
or business customer. Business customer can contribute to provide sustainable revenue growth.
Easyjet hire best people in the industry as part of the marketing strategy and customer
satisfaction. Employees are the face of the organization and recruiting best people in the industry
are one best strategy to improve customer service (easyJet.com, 2017).
Maintaining high standard of corporate governance is another major strategy which is being
taken for future strategy.
A critical evaluation on the selected future strategy for easyjet
Easyjet has taken different strategy for future business growth however to gain marketplace like
other leading competitor is a challenging job. Easyjet offer their customer low fare air ticket
however they are failed to provide the comfort of a luxurious business tour. In that situation,
capturing corporate market can be a challenge for the organization.
Conclusion and Future Recommendations
Thus it can be concluded, with the help of low pricing strategy easyjet have been able to secure a
position in the market. Easyjet is doing their business in major part of Europe and building a
strong network. However this organization has not taken any strategy to develop in global
market.
Considering the current business strategy, it is highly recommended for easyjet to prepare
strategy which can provide maximum comfort to the employee at affordable cost. To gain

business customer, easyjet need to construct new policy which fits the need of corporate
passenger. Finally the internal management of the organization need to make their cost cutting
plan in more realistic ,without compromising customers comfort.

Bibliography
Hill, C. W., & Jones, G. R. (2012). Strategic management cases: an integrated approach.
Cengage Learning.
Holloway, S. (2017). Airlines: Managing to make money. Routledge.
Home | easyJet.com. (2017). Easyjet.com. Retrieved 23 November 2017, from
http://www.easyjet.com/en
Official Ryanair website | Book direct for the lowest fares | Ryanair.com. (2017). Ryanair.com.
Retrieved 23 November 2017, from https://www.ryanair.com/gb/en/
Peppard, J., & Ward, J. (2016). The strategic management of information systems: Building a digital
strategy. John Wiley & Sons.
Sampson, T. (2017). Brexit: The economics of international disintegration. Journal of Economic
Perspectives, 31(4), 163-184.
Welcome to the world of opportunity! | Wizz Air. (2017). Wizzair.com. Retrieved 23 November
2017, from https://wizzair.com/#/
Williams, G. (2017). The airline industry and the impact of deregulation. Routledge.