Strategic Analysis of Virgin Australia: Business Management Report

This report provides a detailed analysis of Virgin Australia's business and corporate strategies. It examines the airline's alignment with Michael Porter's generic strategies, specifically cost leadership and differentiation, to gain a competitive advantage in the Australian airline sector. The report references various studies and reports to evaluate Virgin Australia's strategic decisions, including its repositioning strategy, global expansion plans, and vertical and horizontal integration. It highlights how the company has adapted to market challenges and aimed for growth in the airline industry. The analysis covers aspects like the evolution of Virgin Australia using perceptual mapping techniques, global expansion strategies, and the significance of Southeast Asia. The conclusion emphasizes the importance of maintaining a competitive edge through effective strategy implementation.

VIRGIN AUSTRALIA
Business Management and strategic
management

Introduction
 The overall significance of airlines in
Australia has been increasing at an
extensive rate.
 The paper has taken into reflection
Virgin Australia previously known as
Virgin Blue recognised as the second
largest airline in Australia following
Qantas airlines.
 Additionally the paper will evaluate
Virgin Australia business strategy

Michael porter's generic business strategies
 Virgin Australia has aligned to the strategy of cost
leadership as well as differentiation as per the
generic strategies of Porters (Virgin Australia, 2019).
 Reports of Arblaster (2016) have claimed that
although several strategic losses have been in
opposition to the Virgin mobile, the company has
been able to achieve success in the freight business.
 On the other hand, Zhang, Wang and Fu (2017) have
mentioned the use of cost differentiation strategy by
Virgin Australia.
 According to authors, Virgin mobile has entered into
the market when two highly established cost
structure airlines have already been executing their
business in the market namely Qantas and Ansett.
 Moreover, another significant factor of differentiator
adopted by Virgin Australia has been the
repositioning strategy by taking into consideration
millions of loss incurred in 2009 (Srisaeng, Baxter &
Wild, 2014). D
 rawing relevance to these factors, it has been
mentioned that Virgin Australia has proficiently

Corporate Strategies of Virgin
Australia Using perceptual mapping technique, authors have revealed
that the trajectory of change which has taken place has
successfully driven the evolution of Virgin Australia.
 The vertical integration has represented that Virgin’s quality
has shifted from the basic level of service by offering reduced
and inexpensive cost carriers in comparison to Tiger Airway
Australia.
 Furthermore, horizontal integration represents that Virgin
Australia has shifted to low courier cost to attain high position
in the airline industry.
 Virgin has efficiently repositioned itself from the low-price or
low-service quadrant to the elevated price or high-service
level quadrant it has aided its position in occupying highest
position in Australian airline sector.

Continued…
 For Virgin, Southeast Asia is considered as the third largest on
dimension that is around 20% with New Zealand and
Pacific Islands considered as second largest at 35%. Reports of
Alexander and Merkert (2017) have revealed that Virgin has
developed the strategy of global expansion.
 The company has aimed to fly internationally, but has not
provided any specific timeframe or particular destinations.
Moreover, its strategy of global expansion will come at an
expense of Tigerair.
 Moreover, reports of authors have revealed that Virgin has
focused on serving not only to Asian leisure points but further
expand its business to cities also.
 It has over and over again ruled out points in China as well
as India, pointing to those pints being fragmented and served
over Singapore with associate Singapore Airlines (SIA).
 Such a vital relationship provides Virgin extensive accessibility
around Asia and to Europe with a broader reach in comparison
to Etihad.

Conclusion
 Hence to conclude, Virgin Australia
must efficiently determine
competitive advantage over its
competitors by adhering to cost
leadership strategy and cost
differentiation in order to sustain its
growth and reputation in the
Australian airline sector.

Reference List
 Alexander, D. W., & Merkert, R. (2017). Challenges to domestic air
freight in Australia: Evaluating air traffic markets with gravity
modelling. Journal of Air Transport Management, 61, 41-52.
 Arblaster, M. (2016). Negotiate-arbitrate regulation of airport
services: Twenty years of experience in Australia. Journal of Air
Transport Management, 51, 27-38.
 Lee, B. L., Wilson, C., Pasurka, C. A., Fujii, H., & Managi, S. (2017).
Sources of airline productivity from carbon emissions: an analysis
of operational performance under good and bad outputs. Journal of
Productivity Analysis, 47(3), 223-246.
 Srisaeng, P., Baxter, G. S., & Wild, G. (2015). Forecasting demand
for low cost carriers in Australia using an artificial neural network
approach. Aviation, 19(2), 90-103.
 Virgin Australia. (2019). Virgin Australia | Virgin Australia. Retrieved
from https://www.virginaustralia.com/au/en/
 Zhang, Y., Wang, K., & Fu, X. (2017). Air transport services in
regional Australia: Demand pattern, frequency choice and airport
entry. Transportation Research Part A: Policy and Practice, 103,
472-489.