...companies * High productivity of the staff * Emphasizes on Internet use | WEAKNESSES * The company is ready to sacrifice it all for growth. Indeed, Ryanair has a specific strategy that consists in transferring the costs to the passengers (the company has always tried to find ways of charging passengers for services once considered intrinsic to an airline ticket). * Ancillary services can annoy passengers * Bad reputation (misleading publicity, fat tax, toilet costs…) * Secondary airports which are sometimes far from cities) * Expensive manpower (high salaries) * Poor working conditions * Legal trouble | OPPORTUNITIESEnvironmental : newer aircrafts that produce 50 per cent less emission, 45 per cent less fuel burn and 45 per cent lower noise emissions per seat. * The company is expecting a reduction in fares in order to beat its competitors who will be unable to follow Ryanair in this “bloodbath” * An increase in market share thanks to the demise of several carriers * The European market (the EU enlargement) * Launch of new routes : the company planned to open 146 new routes in 2010 * Ancillary services which can generate money | THREATS * The industry is not in very good shape (global economic recession, oil prices) * Competition (EasyJet) * European laws * Airbus doesn’t want to deal with Ryanair * Airport charges and government taxes * Passenger compensation (delays, cancel flights) | SO : Overcome the image...
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...scheduled revenues and the ancillary revenues. The scheduled revenues are generated through direct sales of flight tickets while the ancillary revenues1 are generated from other non-ticket sales. Figure 1 depicted the growth of the scheduled and the ancillary revenues from 2004 to 2011. While the scheduled revenues increases from € 924,5 mio to € 2.827,9 mio with an increasing return factor equals to 206%, the ancillary revenues increases from € 149,6 mio to € 801,6 mio with an increasing return factor equals to 436% during the period 2004 to 2011. K€ 3.000.000 2.500.000 2.000.000 Scheduled Revenues 1.500.000 Ancillary revenues 1.000.000 500.000 2004 2005 2006 2007 2008 2009 2010 2011 Year Figure 1. Scheduled & Ancillary Revenues Growth from 2004 to 2011 During the same period, Ryanair has produced an average annual increase of the ancillary revenues of approximately 27%. 25% 22% 22% 2010 2011 20% 20% 18% 16% 15% 15% 2005 2006 16% 1 4% 10% 5% 0% 2004 2007 2008 2009 Figure 2. Ancillary Revenues as Percentage of Total Operating Revenues from 2004 to 2011 1 In the Airline industry, Southwest Airlines Company firstly introduced the ancillary revenues. 2 In Table 1, I have reported the evolution of the average scheduled and ancillary revenues with respect to the scheduled passengers. Year Scheduled Revenues (K€) Ancillary Revenues (K€) Scheduled ...
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...FISCAL YEAR 2013 COMPARED WITH FISCAL YEAR 2012 Profit after taxation. Ryanair recorded a profit on ordinary activities after taxation of €569.3 million in the 2013 fiscal year, as compared with a profit of €560.4 million in the 2012 fiscal year. This 1.6% increase was primarily attributable to an increase in revenues driven by a 4.3% increase in average fares and a 20.1% increase in ancillary revenues, partially offset by a 18.3% increase in fuel and oil costs from €1,593.6 million to €1.885.6 million. The result in fiscal 2012 included €57.8 million, net of tax, relating to a one off release of ticket sales revenue due to a change in accounting estimates arising in enhancements to Ryanair‘s revenue accounting system. Scheduled revenues. Ryanair‘s scheduled passenger revenues increased 9.0%, from €3,504.0 million in the 2012 fiscal year, to €3,819.8 million in the 2013 fiscal year, primarily reflecting an increase of 4.3% in average fares. The number of passengers booked increased 4.5%, from 75.8 million to 79.3 million, reflecting increased passenger volumes on existing routes and the successful launch of new bases at Chania, Eindhoven, Fez, Krakow, Maastricht, Marrakech and Zadar in the 2013 fiscal year. Booked passenger load factors remained flat at 82% in both fiscal 2012 and fiscal 2013. Passenger capacity during the 2013 fiscal year increased by 4.7% due to the addition of 11 Boeing 737-800 aircraft (net of lease handbacks). Scheduled passenger revenues accounted...
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...LAW AS ANCILLARY SCIENCE TO HISTORY NAPOLEONIC CIVIL CODE The longest lasting effect of Napoleon Bonaparte's rule over France was his overseeing the implementation of a series of national laws collectively known as the Civil Code, or Code Napoleon. The principal tenet of the Civil Code was that every French person was equal before the law. In 1804, Napoléon I appointed a commission of four persons to undertake the task of compiling the Napoleonic Code. Their efforts, along withthose of J. J. Cambacérès, were instrumental in the preparation of the final draft. The Napoleonic Code assimilated the private law of France, which was the law governing transactions and relationships between individuals. The Code, which is regarded by some commentators as the first modern counterpart to roman law, is currently in effect in France in an amended form. The Napoleonic Code is a revised version of the Roman law or civillaw, which predominated in Europe, with numerous Frenchmodifications, some of which were based on the Germanic law that had been in effect in northern France. The code draws upon the Institutesof the Roman Corpus Juris Civilis for its categories of the civil law: property rights, such as licenses; the acquisition of property, such astrusts; and personal status, such as legitimacy of birth. One century later, after many new codes have been promulgated throughout the world, and while the movement of law reform is still accelerating...
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...| |Strategic Management : Principles and Practise | |Case Study A : RYANAIR | | | | | | | | | 1- You’re invited to use the Value Chain framework so as to explain the extent to which Ryanair has been able to propose low fares to its passengers. In order to develop a competitive advantage - implementing low fares to its passengers - Ryanair offers a series of activities referred to as the Value Chain, as it is shown in the following diagram: |Firm Infrastructure | |Corporate partnerships | |Human Resource Management...
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...classic carriers’ in the way that 20% of its revenue is generated from ancillary revenue, such as its “buy on board” program or extra fees for luggage. As we have seen above, the airline industry is very dynamic, and the apparition of alliances within the market forces Ryanair to stay competitive in its environment. Until now, the company did it very well by being emergent, its flexible structure and culture allowed Ryanair to be the number one on its market. To keep this place, Ryanair needs to adapt itself by choosing a development strategy. For that, there are different directions that Ryanair might take. Development opportunities “In a decade or so, airlines will pay the travellers to distribute people around Europe” Michael O’Leary, the Ryanair’s CEO summarizes the future direction of its company with this sentence. Therefore, Ryanair has to continue to find innovative cut reduction methods, as well as innovative revenue generation methods. In order to remain competitive with its business model, Ryanair will need to have the largest amount of routes in Europe and the lowest fare. It is now clear that there is only room for one or two major actors in the low-cost airline market (88% of the market shared by Ryanair and Easyjet). We are going to examine where the opportunities of development are, and how Ryanair will keep its fare at the lowest, by cutting the costs and by finding new ancillary revenue generations. Market development: The opening of new markets...
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...Executive Summary Ryanair operates as a cost leader in the European low cost carrier segment of the airline industry. As a cost leader they aim to achieve high volume sales by attracting customers with low prices. As a result of charging some of the lowest prices in the industry, Ryanair has seen growth in traffic and reported record revenues. To remain profitable the company focuses on maintaining low costs and efficient operations. The key issues facing Ryanair include how to remain profitable in light of rising fuel prices and currency exchange risk, the ability to maintain market share and growth in a segment characterized by intense competition, and whether or not it would be profitable to expand into the growing international/emerging markets and internet retailing space. In addressing these key issues, it is recommended that Costco focuses on opportunities in the internet retailing space to grow bottom and top line growth as well as increasing market share. It is also recommended that they remain committed to their low cost high inventory turnover strategy in order to continue to offer consumers the lowest prices and achieve high inventory turnover. By taking these initiating the strategies summarized above, Costco will be able to maintain their position as market leader and continue to operate profitably in the discount membership warehouse segment of the retail industry. Business Model & Strategy Ryanair operates as a cost leader in the low cost...
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...Ryanair Marketing Mix Ryanair is the European low cost airline. Low cost or no frills marketing strategies are of great interest to marketers since the marketing mix employed tends to run in opposition to what makes a great brand - and Ryanair is a great brand and a very successful business. In a nutshell Ryanair sells the cheapest tickets that you can buy (on most occasions). If you'd like to learn more about this topic then take a look at our marketing mix lesson. Otherwise please read on. Its charismatic boss Michael O'Leary has a business model with a central focus on cost reduction (and making money of course!). In around 20 years he has taken Ryanair from a single plane company to become the largest airline in Europe. He had a vision and achieved it through masterful leadership. So how did he do it? How does Michael O'Leary retain his narrow cost focus niche strategy in the face of intense competition? The business simply has lower costs and those costs are passed on to their passengers in the form of low fares. The branded airlines argue that passengers are willing to pay more for a better level of service. You can pre-assign seats. You get food and drink onboard, and can choose a higher level of service e.g. business class. However the large flag carriers have taken notice of the low-cost model and have employed it as part of their own more differentiated business model. In 2009 the company settled for 30% of its local Irish rival Aer Lingus after a prolonged...
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...Definition of pricing strategies is the element of a firm’s decision-making concerned with the setting of process that will attract the target market and allow profit objectives to be met. Ryanair’s objective is to firmly establish itself as Europe’s leading low-fares scheduled passengers’ airline through continued improvements and expanded offerings of its low-fares services. Ryanair aims to offer low fares that generate increased passenger traffic while maintaining a continuous focus on cost-containment and operating efficiencies. A good pricing strategies had help Ryanair to achieve the objective and aims. Ryanair’s low fares are designed to stimulate demand, particularly from fare-conscious leisure and business travelers who might otherwise have used alternative forms of transportation or would not have traveled at all. Ryanair sells seats on a one-way basis, thus eliminating minimum stay requirements from all travel on Ryanair scheduled services, regardless of fare. Ryanair sets fares on the basis of the demand for particular flights and by reference to the period remaining to the date of departure of the flight with higher fares charges on flights with higher levels of demand for bookings made nearer to the date of departure. Ryanair’s tight cost control was the backbone of its low-price strategy. As a result of this cost focus, Ryanair had by far the lowest costs in Europe, about 40% lower than its closest competitors. One of the elements of Ryanair’s cost-control...
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...地 在所 久 永 的 部 總 壇論 為 鰲 博 南海 ； 台 平 話對 層高 的 題問 關相 他 其 及 境 環 、 會社 、 濟經 商共 個 一 供 提 等 者 學 家 專 及 業 企 、 府 政 為 ； 織組 際 國 的 址 定 、 期 定 、 性 利營 非 、 方 官非 為 壇 論 。 件 文 性 領 綱 等 》 則 原 導 指 程 章 《 、》 言 宣 《 了 過 通 時 之 立 成 。 立成 布 宣 式正 ， 會 大 開召 鎮鰲 博 的 口 海入 河泉 万 市海 瓊 省南 海 在日 月 年 於 ， 起發 亞 利大 澳 和 家國 洲 亞 個 由 ， 壇論 鰲 博 洲亞 、 壇論 洲亞 為稱 或 ，） ： 名 文 英 （ 壇 論洲 亞鰲 博 。 處 書秘 的 定 協 總 易貿 及 稅 關 的 施實 起 年 是 身前 ， 織 組 際國 個 一 的 行 執 到 得 議協 易 貿 種各 間之 體 濟 經 員成 督 監 責負 是 織組 貿世 。 值 價 場市 的 務 勞 和 品商 終 最 有所 的 產生 ， 中 間時 位單 一 某 在 民人 內 國 國 一 表代 來 未 的 樣 麽怎 導 指 會 灣臺 將 者 導領 的 選當 考思 加 更 要 人 灣臺 ， 選 大統 總 的 年 在 合融 益日 係 關 岸 兩 時 同 ？ 況 狀濟 經 的 陸大 賴 依 越來 越 是還 上 得 跟 能 灣 臺 ， 速快 與 大巨 展 發濟 經 陸 大 國 中 ， 年 去過 所 院 法立 月 年 。 濟經 岸兩 國民 華中 領 佔 指 ， 等 件事 定協 易貿 務 服 的 峽海 《 據 依 岸 兩。 件事 動運 會社 的 起 引 起 發 同 共 們 民 公 和 生學 大 的 灣 臺 起 日 會 國 領佔 、 運 學 稱又 運 學 花 陽太 署簽 所 條 四 第 ） 稱 簡 （》 議 協 構 架 作 合 峽海 是 ） 議協 易 貿 務服 岸兩 峽 海 （ 議協 貿...
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...EasyJet underlines advantage over budget competitors as profit soars EasyJet underlined its growing advantage over budget rivals, reporting annual profit at the top end of forecasts and returning cash to shareholders. The upbeat assessment is in contrast to that given by Ryanair, Europe's biggest budget airline, which this month cut its annual profit target for the second time in two months and admitted it needed to improve customer service. Rival airlines have been struggling with high fuel costs and weak consumer confidence, sending some smaller carriers out of business while the likes of British Airways owner IAG and Air France-KLM have cut routes, leaving gaps that low-cost airlines have been quick to exploit. Over the last three years easyJet has added flights on routes where rivals have cut back, and introduced more flights between top business destinations. It has also added flexible ticketing to allow passengers to change their flight up to two hours before scheduled departure time, and allocated seating in an attempt to steal corporate customers. EasyJet proposed a full year dividend of 33.5 pence a share, 55.6pc up on last year, and a special dividend of 44.1 pence per share, making a total payout to investors of £308m. It said forward bookings were in line with last year but that its first quarter would be impacted by tough year-on-year comparisons due to strong post-Olympics demand in the UK and travel restrictions to Egypt. However, EasyJet still expects to...
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...Master in International Business, Intake 7 London Corporate Web Communications http://www.ryanair.com Martin Sentis 11 Martin Sentis MIB 7 – Group B Table of content INTRODUCTION ................................................................................................................................. 3 BUSINESS OBJECTIVES AND BUSINESS MODELS ............................................................................... 3 Presence ........................................................................................................................................ 3 Pricing ........................................................................................................................................... 3 Revenue......................................................................................................................................... 3 Exchange type ............................................................................................................................... 4 How does the Internet add value? ................................................................................................ 4 Rappa’s business model ................................................................................................................ 4 AUDIENCE PROFILE ........................................................................................................................... 5 WEB EVALUATION......................................
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...Research in Transportation Business & Management 10 (2014) 40–44 Contents lists available at ScienceDirect Research in Transportation Business & Management Transferring low-cost marketing practices from air to rail services: The Ouigo case Paul Chiambaretto a,b, Anne-Sophie Fernandez c a b c MRM-Groupe Sup de Co Montpellier Business School, 2300 Avenue des Moulins, 34080 Montpellier, France Ecole Polytechnique, PREG-CRG, Bat. Ensta, 828 Boulevard des Maréchaux, 91762 Palaiseau, France MRM-ERFI, University of Montpellier 1, Espace Richter, Rue Vendémiaire, Bât. B, CS 19519, 34960 Montpellier Cedex, France a r t i c l e i n f o Article history: Received 24 October 2013 Received in revised form 11 May 2014 Accepted 12 May 2014 Available online 29 May 2014 Keywords: Low-cost High-speed train Replication strategy Intra and intermodal competition a b s t r a c t More and more airlines have adopted a low-cost business model and many scholars have studied the characteristics of such marketing strategy. While other transport modes have decided to copy and adopt this strategy, we investigate how they replicate this business model. To do so, we in-depth study the operational and marketing characteristics of Ouigo, the new low-cost offer launched by the French rail operator SNCF in 2013. Based on interviews and secondary data (press articles, reports, etc.), we analyze how the rail operator has adapted the low-cost model used by airlines to the...
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...MGT 6753 Industry Analysis Low-Cost Carriers in Europe Julian Geiger, Michael Schlottke, Marcus Schrade MGT 6753 Industry Analysis Low-cost carriers in Europe Industry Overview The market for low-cost carriers first emerged in the US with Pacific Southwest Airlines, pioneering the concept in 1949. The European market did not really develop until aviation deregulation came into effect in the 1990’s, making flights affordable for a wider range of customers. Building on the inclining demand for cheap flights mainly by private individuals (average annual growth of 9.4% for leisure travelers between 1996 and 2003 [11], Figure 2), the industry has experienced rapid growth since then. Most notably, Irish airline Ryanair, formed in 1990, and British company EasyJet, formed in 1995, were able to shape the European market (Figure 3). Germanwings and Air Berlin are additional major players in the low-cost carriers (LCC) market throughout Europe. PEST Analysis The evolvement of the LCC industry in Europe was only possible through one major political decision in 1997 – the deregulation of the European flight market. Before, the market for flights was largely controlled by the governments of European countries, trying to secure their respective national carrier’s market share. This led to high prices for European flights – airfares were roughly twice as much as those for comparable distances in the U.S. [1]. After lifting most restrictions and enabling European carriers...
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...budget flying------------------------------------------------- Budget Flying Within Europe Budget flights can save you time and money, but beware the fine print. By Rick Steves When I started traveling, no one spending their own money bought one-way airline tickets within Europe. It simply wasn’t affordable. But today that kind of thinking seems so 20th century. Before buying any long-distance train or bus ticket, it's smart to first check the cost of a flight — you might be surprised. The proliferation of extremely competitive discount carriers has revolutionized European-itinerary planning and turned vagabonds into jetsetters. Because you can make hops just about anywhere on the Continent for roughly $100 a flight, deciding where to go is now mostly just a question of following your travel dreams: You're no longer limited to places within a convenient train ride (or reasonable drive) from each other. It's now entirely feasible to lace together a far-flung trip that ranges from, say, Ireland to Portugal to Sicily, if you please. Using Budget Airlines Since Europe deregulated its airways in the 1990s, a flock of budget-conscious, no-frills airlines have taken flight. Some of the most established (such as easyJet and Ryanair) have route maps that rival their mainstream competitors. Meanwhile, dozens of smaller, niche airlines stick to a more limited flight plan. For a list of many of these carriers — including websites and some of the destinations they serve — see the below...
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