Strategic Marketing CW2 Report: Virgin Atlantic Nigerian Market Entry

This report provides a comprehensive strategic marketing analysis for Virgin Atlantic's potential entry into the Nigerian airline market. The executive summary highlights the adaptation of the marketing mix to meet the needs of the target market, emphasizing the mitigation of the COVID-19 effect. The report delves into the Customer-Based Brand Equity (CBBE) model to build a strong brand identity, exploring marketing communication methods like advertising and public relations. It examines adaptation and standardization of the marketing mix elements: product, price, promotion, place, people, process, and physical evidence. The report advocates for a value-based pricing strategy and digital media marketing tailored to the Nigerian market. The report also includes an analysis of how to measure the success of marketing campaigns using tools such as return on investment, market share and balance score card. The conclusion summarizes the key findings and recommendations for Virgin Atlantic's successful entry into the Nigerian market.

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Module Name: Strategic Marketing CW2
EXECUTIVE SUMMARY
This report provides analysis into how Virgin Atlantic can successfully gain entry into
the Nigerian Airline market. This analysis focused on the adaptation aspect of
marketing mix to meet the needs of the targeted market in order to ensure that Virgin
compete successfully in the market, mitigating effect of COVID19 to maintain market
share. Using the CBBE model, an analysis of how Virgin Atlantic can build a strong

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brand also analysed using the different element of the model. This include defining
Virgin Atlantic brand identity and its relationship with customers. Marketing
communication methods that will be used to reach the target market is also
suggested such as advertisement and public relations and how they can be
integrated to promote consistency. As with every other business activity that
involves investment, it is important that these marketing campaigns are measured to
determine its effectiveness using different measuring tools such as return on
investment, market share and balance score card.

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Table of Contents
EXECUTIVE SUMMARY........................................................................................................1
INTRODUCTION..................................................................................................................3
1: ADAPTATION AND STANDARDISATION OF MARKETING MIX...........................................5
2: CBBE MODEL..................................................................................................................7
3: INTEGRATED COMMUNICATION MIX AND METHODS.....................................................8
4: MEASUREMENT OF SUCCESS ..........................................................................................9
5: CONCLUSION ................................................................................................................11
REFERENCES ....................................................................................................................12
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INTRODUCTION
Strategic management is the process of planning, developing and
implementing marketing strategy that is developed to ensure that the business is
able to achieve its objective in the market . In most cases the objective of a business
is to make profit but to achieve this the business will have to identify needs of its
customers and design products that will meet those needs profitably (Lim and et. al.,
2020). This aspect is particularly important for new businesses or products as it
helps to gain an understanding of the market in order to gain competitive advantage.
The aim of this report is to address the needs for adaptation and standardisation of
marketing mix. Along with it need for Virgin Atlantic to adapt marketing mix in order
to expand their business in Nigeria is also discussed. Customer based brand equity
model, communication and promotion techniques used by Virgin Atlantic and the
measurement of its success are explained.
1: ADAPTATION AND STANDARDISATION OF MARKETING MIX
According to Krishnamurthy (2016), modern businesses have vast
opportunities to maximise their revenue by entering into new and emerging markets.
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However, entering into the international market requires or involves taking strategic
decision in relation to market entry choice and branding as well as the level of
adaptation or standardization of products and services in the market, considering the
current world political and economic environment. The level of adaptation and
standardization of each element of the marketing mix is considered critical success
story of any business in the market including of Virgin Atlantic in the Market.
Standardization is described as using the same range of products, pricing, location
and promotional strategies due to the homogenization of consumer wants and needs
(Gupta and Randhawa, 2008). Standardization focuses on the core competitive
advantage of a business thereby ensuring a consistent strong brand across all
markets (Donelly, 2009). For example, Virgin operations in different regions adopts
standardization strategy to a great extent by duplicating its services in all regions to
build a strong brand image that people can easily resonate with. Adaptation on the
other hand, implies the changing of different aspect of the products to a considerable
extent in order to be able to meet consumer needs in the international market
(Chung, 2009).
Benefits of standardisation includes it helping in reducing ambiguity and
guarantee quality in order to increase productivity as well as morale of employees in
organisation. Although there are some drawbacks of standardisation as well which
include the loss of creative minds in an organisation due to standardisation. The worl
also becomes similar and boring due to standardisation.
Unlike standardization, adaptation offer the benefit of meeting the different
needs of this local market at different levels thereby achieving greater level of
satisfaction. For example, Red Bull uses adaptation strategy different markets based
on local needs and expectation. In North America the red design of its product
signifies power and courage, while Bull in Chinese market is designed in Gold and
red colour as gold represent wealth and happiness in China. In the case of Nigeria, a
popular Nollywood actor by name Salami Adebayo known widely in the country and
well liked as a smart always well-dressed young good looking man with media
experience, will best serve Virgin image in Nigeria. What this means for Virgin
Atlantic is that by aligning its marketing strategy with local image the airline will be
able to meet the varying needs of the targeted market through the adaptation of its
marketing mix.
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Adaptation have a number of benefits like it helps an organisation to build
their image in market. Adapting products and services as per local specifications
helps an organisation in creating a good local image and keeps consumers satisfied.
However it is a time consuming process which also requires huge investment. The
execution speed of adaptation is slow and it also becomes difficult for organisations
to understand expectation of consumers.
Product (Adaptation): the entrant into the Nigeria Airline market by Virgin Atlantic
will see the introduction of a differentiated service that will target mainly the upper-
and-middle-class in Nigeria (that is politicians and business executives that lives in
Abuja). As a global brand, the service will see the introduction of a standardised
service from the UK to Abuja, Nigeria, with slight alteration (adaptation) to inflight
services that reflect the local culture in Nigeria such as food and entertainment. This
will allow flyers to own their flying experience while meeting their needs and
expectations.
Pricing (adaptation): According to Campbell (2020), the adoption of a value-based
pricing strategy is effective when a business has a strong competitive advantage.
Value based pricing is when the prices of product and services are based on the
benefits that is received by consumer after experiencing product or service rather
than charging for cost of production. Hence, Virgin Atlantic value-based pricing
system will allow flyers to be able to decide how they want to be served, the services
they require and how much they are willing to pay based on their needs and
expectations. This will help Virgin Atlantic to again competitive advantage in the
market as the price will fit the perception of the flyers. Hence, in the situation that the
customers are not satisfied rather than reducing prices, the best approach would be
to increase the value for customers in order to ensure their satisfaction (Dolansky,
2017). When dealing in Nigeria Virgin Atlantic will use the official currency of Federal
Republic of Nigeria which is Nigerian Naira.
Promotion (adaptation): Virgin will have to adapt promotion targeted at Nigerians
flyers to local content. Promotional strategy used by Virgin Atlanta to run its business
in Nigeria is digital media marketing. They will be majorly focusing on various ways
to promote their services using internet as a media. This will effectively save their
cost and also help them to reach huge number of customers at once. Although the
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marketing campaign will utilise existing strategy in the global market but will be
tailored to needs, expectations and culture of the local market.
Place (Adaptation): due to the intervention of the internet and the current global
pandemic Virgin will have to utilise its online distribution platform for flight bookings.
Although connectivity in Nigeria is still at the lowest, the targeted market are able to
afford internet and also spend most of their time online, which is beneficial to Virgin
(Dost and et. al, 2019)
People (Standardised): to ensure that the local market are well served, Virgin will
have to recruit locally. The local workforce will have a better understanding of the
people and their needs and will help Virgin to establish itself in the local market.
Process (standardization): to ensure Virgin is able to provide efficient services and
ensure uniformity, the airline will have to continue with its standardised operations
and processes. This ensure that Virgin continually adopts its existing process that
has proven to be effective and efficient across its network.
Physical evidence (standardization): the targeted market have more trust in what
they can see. Hence it is important that Virgin have significant presence throughout
the country using different promotional campaigns related to local culture on
billboards, flyovers as well as physical building.
The price, product promotion and place will be adapted where as physical evidence,
process and people in an organisation will be standardised. Standardisation will be
done in order to make sure that all the processes in organisation along with people
and physical evidence are always same. These deliver the values and functioning of
company due to which they are standardised (Porcu and et. al., 2019). On the other
hand various P's such are product, price, place and promotion need to be adapted.
The reason behind this is that in order to set up a business in new place a number of
cultural issues have to be managed by organisation. Therefore, to cope up with such
challenge it will be easier for company to carry on their business adapting various
cultural activities and believes of new culture.
2: CBBE MODEL
Customer based brand equity (CBBE) is a model that is used to show how Virgin
Atlantic brands success can be attributed directly to the attitude of the customers
towards the airline (Keller, 2013). Brand and branding are interrelated. Brand is
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everything an organisation consists of. It is the reputation, product, perception of
people and everything. This is the image of organisation in mind of people. On the
other hand, branding is the process through which brand is created. It is one of the
marketing strategy which is used by managers in an organisation to influence people
to respond in a particular manner towards the products and services. One of the
best-known models of CBBE is the Keller Model developed by Kevin Lane Keller.
Keller brand equity model is used by organisations to increase their brand equity..
The pyramid shaped model shows how Virgin can build from its strong foundation of
brand identify towards a brand equity resonance where flyers are in a positive
relationship with the airline and be an advocate for it. If Virgin is able to build a strong
brand equity, customers will buy more, they will become loyal to the airline and also
more likely to recommend to others.
Keller’s Brand Equity (Keller, 2013).
Who are you? This is how the flyers will look at Virgin and distinguish it from
competitors. It explores the images and unique selling point customers associate
with when they hear Virgin Atlantic. The targeted customers are mid-to-high income
earners who are familiar with luxury. As such, Virgin Atlantic will have to retain its
luxurious, modern and generic brand image in order to meet their expectations.
Every aspect of Virgin Brand speaks as a truly universal exotic band.
The brand image which virgin brand has created will help it in successfully setting up
its business in Nigeria. The foundation of company is very strong. The promotional
techniques used by Richard Branson are excellent which will help them in setting up
business in Nigeria successfully. They will also provide employment in Nigeria which
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is another benefit for local people. They can also take some Nigerian celebrity who
would then become brand ambassador for company. Nneka Egbuna is a Nigerian
singer, songwriter and actress. She can be face of Virgin group in Nigeria.
Keller's brand equity model explains that all the work which is done by an
organisation towards a brand is to increase brand equity. Various phases of it are
discussed below:
 Brand identity is the way customer may look up to brand. It is possible that
customers feel of Virgin group to be a foreign brand. They may ignore it as it
will be less local. Advertising will effectively help to spread awareness and
company can set up their business in Nigeria.
 Brand meaning is next where it becomes necessary to explain that what does
the brand stand for. Here Virgin group needs to convey the message that they
are focused upon helping consumers by providing good quality products at
reasonable prices.
 Brand response is next. In this virgin group is building the feelings of people
towards the brand. They are effectively working on providing people with a
feeling that the brand is not working as per their international levels but they
are actually bringing in local ethics and values with them.
 Brand resonance is last stage in which requirement is to create a strong
relationship with customer (HR and Aithal, 2020). It is possible that virgin
makes a number of promises to people in Nigeria and does not fulfil any of
them. In this way they cannot stay in market for longer period of time.
Therefore it is necessary for them stay focused and work on service delivery
continuously.
What are you? When customers are aware of the Virgin Brand, they will want to
know more about the airline by questioning its style, looks and reliability. Hence, as a
high value brand with a differentiated service, Virgin will have to communicate this to
the customers through different medium. For example, this can be communicated by
ensuring that customer needs and expectation are met at all times with the highest
quality possible. Virgin brand is focusing on providing the image of trustworthy and
culturally accepting brand. A number of changes are made in the marketing strategy
in order to make sure that company can effectively dwell in the culture and believes
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of the nation. They are portraying themselves as an adapting brand and focusing on
providing customer with everything they need. They are working on their brand
image and getting in customers good books while doing so.
What about you? This aspect is emotional, making it hard to separate feelings and
judgement as they are entirely personal to the customers. One customer may find
Virgin exceptional, while another may find it ordinary (Keller, 2003). When compared
with another airline in the region, the Virgin Brand is considered high quality but with
high price than competitors. However, reducing its price can affect customer
perception of premium and quality. As such Virgin will have to consider offering more
value for flyer in order to exceed their expectations. The organisation would want
that people are inclined towards product and services which are provided by Virgin
group. It is necessary that people have a positive image of organisation so that
company can successfully set up their business in Nigeria. It is necessary that
people invest their time and money travelling with virgin and share good experiences
which in future will also bring business and create a trustworthy image of Virgin in
Nigeria.
What about you and me? Customers will consider Virgin brand superior when they
become loyal to the brand. On the other hand if customers are not accepting the
brand then it might be required by business to create another strategy keeping
customers perspective in mind. To attain this level many things will resonate with
them which are customer service, product value and in-flight experience. Hence,
Virgin will have to increase and extend its customer loyalty base. This can include
rewarding customers when they make a purchase, which can help to ensure return
purchase as well as increase customer involvement. The value of friendship which is
the core value of Virgin, deployed as a secret weapon helping Virgin to maintain
diversity and inclusion in the new market environment.
3: INTEGRATED COMMUNICATION MIX AND METHODS
Integrated marketing communication is simple form of communication that ensures
that all forms of communication messages are linked together. This means
integrating all promotional tools used for marketing by Virgin Atlantic in order to
ensure that they work together in harmony. Although it may require a lot of efforts,
the benefit is that it helps to tailor marketing messages to the targeted market and
ensures that it remains consistent across all channels. This will help Virgin to design
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a cost-effective marketing campaign that will create competitive advantage, help
boost sales and profitability. There are different types of marketing methods that can
be deployed by Virgin to reach the targeted market.
Advertisement: This comes in different forms and include search engine
optimization, billboards, television, radios and magazines. While each of the different
forms has cost implication, Virgin will be working with limited resources. As such to
ensure efficient use of marketing resources, a billboard advertisement is advised
within business district in Abuja where middle-and-upper class are likely to live and
work. The benefit of the billboard is that it will only be deployed ones but has the
capability to continually reach out to the targeted audience. More important it is one
of the most used advertisement platforms used widely across Africa including
Nigeria. The limitation that it can be costly, and the marketing message cannot be
easily changed if required.
Public relation: This is the process of promoting the public image of Virgin Atlantic
by building a mutual beneficial relationship between the public and the organization
(Broom, 2009). The approach can be deployed by Virgin by engaging in charitable
activities that will help to sustain the community in which it operates. Such activity
will help to create awareness and trust, as it shows the company is committed to
contributing its quota to the society rather than just making profit. This perspective is
mostly cherished due to the significance of sustainable practices and CSR in the
region. However, limitation is that poor publicity can ruin the reputation of the airline.
Viral marketing: This is the process where customers are encouraged to share their
flying experience with Virgin (Howard, 2005). The interaction with customers through
the internet can be very beneficial and a major marketing tool due to the number of
people using the internet. This experience provide feedback that can serve as a form
of information that can influence flyers decision to book a flight with Virgin. However,
the limitation is that not all customers are interested in providing feedback especially
the targeted customers with busy schedule.
Viral marketing is the best strategy that can be used by Virgin Atlantic in order to
effectively meet the requirements of business. Viral marketing has a personal touch
of customers which will allow business to make sure that customers are attached to
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the promotion strategy. It also creates a recall value due to which organisation can
effectively increase their revenues and attract more customers.
4: MEASUREMENT OF SUCCESS
Measuring marketing success is one of the most important aspect of marketing
process as it helps to determine the effectiveness of Virgin Atlantic marketing efforts
(Kuchrivary, 2018). The objective of Virgin Atlantic in the new market is to become a
market leader and maximise profitability. It is important for an organisation to make
sure that they are effectively measuring market control and market success so that
they can understand weather the functions are carried as per the predetermined
manner or not. It is necessary that organisations understand what changes are
required by business to make sure that they can make things work according to the
strategies which are created in beginning. Hence, the marketing campaign will be
measured in terms of market share, return on investment and customer lifetime
value.
Return on investment: this method measures the sales revenue generated from
the marketing campaign. For instance, if the marketing team spent £5,000 on a
marketing campaign that generates £50,000 in sales, then the return on investment
is £45,000, which is more than 700%. This method is one of the most effective KPI,
as it determines the quality of leads that have been generated. Unrivalled
Market share: this is the percentage of Virgin Atlantic overall booking (sales) in
Abuja, Nigeria. It is calculated as number of sales made by virgin within a particular
period. For instance, if the overall sales of airlines in the city is 10,000 flight tickets, if
Virgin Atlantic sells 2,000 tickets, then the market share of Virgin is 20%. This can
help Virgin to determine its dominance in the market and how well it is marketing
itself products and services.
Sales targets: simply put it is a target that is set by Virgin to be met by the sales
team. The target is the aim to be archived, while sale target is the number of sale
that the sales team need to achieve within a specific period (Nikolaus, 2013). The
sale target can be used to monitor the sales that is generated by the sale team in
Virgin, which can help to determine the effectiveness of the airline’s marketing
campaign.
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Limitations of using these methods to measure success.
 Using ROI in order to measure success of an organisation is not always
effective as return can be in a number of forms and intangible benefits to
organisation cannot be measure by using sales target, ROI or market share
method.
 In order to measure success Sales Target is not always appropriate as there
are a number of instances when sales target might not be achieved or over
achieved and there can be various external factors responsible for this.
Therefore, measuring success of an organisation base on target sales is not
appropriate.
Balanced Scorecard: Balance score card is defined as an integrated set of
performance measures that is derived from and supports the organisation strategy.
That is to achieve strategic objective, aligning customer’s priority with their
expectations, implementing control process by setting measurable standards,
tracking progress, evaluating process changes, continually improving to increase
accountability. In Virgin Atlanta major focus is paid upon ROI. ROI is an important
factor that helps an organisation in understanding the importance of finance and
effective investment in organisation. Company need to develop various strategy
which will help in reaching their sales target. This can include various promotional
strategies. They can also effectively tap into new markets which will help them to
increase their customer range as well as market share.
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Source: datapine.com
5: CONCLUSION
By adapting its marketing mix Virgin Atlantic will be able to meet the specific needs
of the targeted audience in the new market, which will ensure that it is able to
compete effectively in the market. By focusing on all the different aspect of CBBE
model, the company will be able to build a reputation and brand in the region.
However, this will include effective marketing communication strategy and
measurement that position the brand in the mind of the flyers. Strategic pricing
measure will have to be in place to mitigate the unmissable impact of the Covid19
Pandemic, which analysis by American cheap flight platform Dollar flight Club
suggests flight prices could be set to drop by 35% average in 2021. It has also been
analysed that average ticket price could rise by over a quarter (27%) on 2019 prices
by 2025. “Analysing data from past downturns and initial response from airlines as
Covid19 impacts the industry, it is expected in the short term for airfares to reduce
preceding a substantial increase in airfares above 2019 levels in the long term”, the
report said. The rep ort references two other significant events in the aviation
industry over 20years: 9/11 and global financial crises (GFC). Immediately after the
fall out of 9/11 in 2001, ticket prices fell by 18% before rising 25% above the average
(43% from the bottom) by 2003. After the GFC, prices fell by 21% in 2008 before
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hitting a peak of 24%above the average in 2012.
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