the Scoot-Away

Airline Market Trends

 

Changing competitive landscape

 

As examined in Assignment 1, the airline industry sees intense rivalry due to the sheer size of competition and difficulties within the industry. Major players like JetStar and AirAsia X have a more established brand presence and top of mind awareness among consumers. Both airlines also serve a much wider range of flight routes. These airline carriers are able to leverage on connectivity between their own branded airlines, codeshare agreements and interline partnerships with other carriers, boasting more destination and flight options. These airlines also continue to improve on their customer experience through better web booking and check-in services, facilitating the ease and quickness of booking. Within the budget carrier industry segment, consumers are price conscious and value seeking, carrying a mindset of minimising absolute dollar costs. Thus competitors are seeking new measures to reduce costs so as to reduce airfares (cost leadership). Scoot must be cognizant of these consumer characteristics as it works on emphasising its points-of-differences (differentiation).

 

Amid this competition is a tough global economic environment that sees sluggish recovery, with notably rising fuel prices. Rising inflation rates aggravate the rising operational costs; so Scoot must ensure it is able to fend off competition by staying cost-efficient

 

Future trends and innovation 

 

Consequent to an ailing global economy, consumers are increasingly keener on taking budget flights to explore new vistas. The rise of social media and the voice of a #YOLO mindset have become louder than ever, encouraging consumers to travel more frequently to explore the world. Scoot is primed to tap on social media and this emerging market trend as it differentiates itself from the competition.

 

Strategic challenge for Scoot

With competitors finding new ways to reduce and defray their operational costs, Scoot must stay cost-competitive whilst leveraging and emphasising its unique brand personality, emphasising its points of difference and communicating these characteristics such that it becomes relevant for the consumer, that consumers become more drawn to the Scoot brand amidst an industry segment where brand differences have not mattered as much.