the Scoot-Away
Stage 2: Financial Analysis
We derived the potential growth rates for our segments based on Scoot’s current online marketing strategies, research reports and our own primary research.
We assume the growth rate to be a compounded one, as Scoot plans to increase the number of aircraft from 2 to 14 by 2016. This will increase the number of destinations Scoot will be reaching out to as well as the capacity of passengers it can take.
However, our speculated growth rate still remains conservative as we expect competition in low cost carrier industry to intensify
Value Seekers: 3.5%
Scoot’s Facebook platform and weekly EDMs are its main broadcasting tools. Scoot has a strong engagement with its community, facilitating 2-way dialogues on its Facebook page. This can be seen via the active conversations and quick response time they have achieved.
The Facebook page often features new competitions as well as new promotional offers. On a weekly basis, promotional offers are launched on Facebook and sent out via EDMs. This appeals to the value seekers out there we are enticed by that discount or that free meal they can get on board Scoot. As the frequency of such promotional offers are maintained and as the promotions get more attractive, we can expect this segment to experience the greatest growth.
Scoot has been actively reaching out to the young at heart, by sharing of plans to launch Scoot in Silence, allowing passengers to get blankets at an affordable price. Other campaigns such as promotion of a Scoot Community to share traveling tips for parents with young children reveals their desire to grow the young at heart segment.
Young at Heart: 1.5%
Low cost carriers were seen as a mode of transport for the young and not for the elder ones or families, as full-fledged carriers seem to be able to provide that security and assurance the elder ones are seeking off. However, there has been greater acceptance of budget travel, a drop in complaints of low cost carriers as reflected by CASE seem to suggest that people are lowering their expectations or low cost carriers have been upping their game.
Young: 2%
We predict a steady increase of growth in this area as Scoot continues to ride on the growing trend of young leisure travelers in Singapore. The rise of low cost traveling has made frequent traveling possible and affordable for the younger ones. The interesting competitions on Scoot’s Facebook platform have been able to actively engage youths and the public as a whole. With 100 over shares on their recent Valentine’s Day promotion featuring young couples, it is no doubt that Scoot has been reaching out the younger ones.
