Lecturer: Prof. Zeinab Khalifah

SOCIAL MARKETING: AIR ASIA AS A CASE STUDY

Prepared by:Lida Sayahi

3March 2011

Master of Science in Planning (Tourism)MIT2203

TOURISM MARKETING

CONTENT

INTRODUCTION OF AIR ASIA SOCIAL MARKETING SOCIETAL MARKETING CONCEPT SOCIETAL MARKETING IN AIR ASIA CONCLUSION

Air Asia Berhad is a Malaysia-based low- cost airline

Asia's largest low-fare, no-frills airline and a pioneer of low-cost travel in Asia

Domestic and international flights to over 400 destinations spanning 25

countries

The low-cost-carrier terminal(LCCT) at Kuala Lumpur International

Airport(KLIA)

Thai, Indonesia, and Philippines Air Asia will be operated at mid-2011 with

14 air planes

won the Skytrax World's best low-cost airline award in 2009 and 2010

The world's lowest operating costs at $0.035/seat-kilometer in 2010

The first airline in the region to implement fully ticketless air travel system

INTRODUCTION OF AIR ASIA

INTRODUCTION OF AIR ASIA Air Asia X is a long- haul, budget airline based in Malaysia

The airline is operated by Air Asia X

It commenced operations on 2 November 2007

Its first service flew from Kuala Lumpur International Airport, Malaysia,

to Gold Coast Airport in Australia

Air Asia X flies to destinations within Asia , as well as destinations

in Oceania and Europe

The airline operates a fleet of 11 aircraft and has placed orders for more.

Air Asia X operates as a franchise of the brand Air Asia, which is Asia's

largest low-cost carrier

The franchise is able to keep costs down by using a common ticketing

system, aircraft livery , employee uniforms, and management style .Air Asia

X is also affiliated with Virgin Groupand Air Canada

Established in 1993 , Commenced operations on 18 November 1996

Originally founded by a government-owned conglomerate DRB-Hicom

On 2 December 2001, the heavily-indebted airline was purchased by

former Time executive Tony Fernandes's company Tune Air Sdn Bhd for the

token sum of one ringgit

After great deliberation as the initial offer was fifty sen

Fernandes proceeded to engineer a remarkable turnaround, turning a profit

in 2002 and launching new routes from its hub in Kuala Lumpur International

Airport at breakneck speed, undercutting former monopoly operator

Malaysia Airlines with promotional fares as low as RM1 (US$0.27)

AIR ASIA History

SOCIAL MARKETING

Social Marketing: the use of marketing

principles and techniques to influence a

target audience to voluntarily accept, reject,

modify or abandon a behavior for the benefit

of individual, groups or society as a whole.”-

Improving the quality of life- Philps Kotler,

Ned Roberto, Nancy Lee

Focus on the stakeholders, as well as

the business and its customers

Need to balance 3 items;

Company profits

Customers wants

Society interests

The difference between short term

consumer wants and long term

consumer welfare

SOCIETAL MARKETING CONCEPT

Corporate Social Responsibility (Environment)

Investment in the Latest Technology and Efficient Use of Aircraft

The new aircraft are more efficient to operate and more fuel efficient

and we realise substantial savings with the group-wide operation of a

single model aircraft.

Air Asia flies direct, or “point to point”, and does not offer any

connecting services. A direct service between two points will produce

lower emissions than two flights via a hub.

For example, On average each of Air Asia’s Airbus A320 aircraft

carries 22 more passengers and airlines operating an Airbus A320

aircraft would burn 15%more fuel per passenger, compared to Air

Asia.

Corporate Social Responsibility (Environment)

Short turnarounds

Air Asia’s business model is designed to achieve high aircraft

utilisation. Key to this is minimising the turnaround time.

Minimal Use of Ground Equipment and Simple Airport

Infrastructure

Air Asia encourage their passengers to use our self service

check-in options, which helps reduce the need for expensive

airport infrastructure.

Corporate Social Responsibility (Environment)

Minimal waste

Air Asia’s no frills service is designed to reduce

waste in all areas. Air Asia is a ticketless airline and

has a policy of operating a near paperless office.

What paper waste there is, is disposed of through

our “Red Heart, Green Mind” recycling program.

Corporate Social Responsibility (Environment)

Excess baggage fees

Air Asia charges for excess baggage, thus encouraging our

guests to fly as light as possible. Increasing these fees not only

adds revenue to the airline, but also serves as a strong

disincentive to bringing on board heavy luggage. Reducing the

weight on board aircraft helps increase fuel efficiency and

maximizes environmental considerations in other aspects of

operation as well.

Corporate Social Responsibility (Community)

Indonesia earthquake: Air Asia put on a special “charity flight” from Jakarta to Padang,

offering seats for free to families of the victims. Within 20 minutes,

all 142 seats were snapped up. We also provided 1.5 million tons of

free cargo space to ferry relief supplies to the earthquake-hit area.

AirAsia ferried–free of charge–more than 56 tones of goods,

including food, medical equipment and clothing, Among the relief

agencies and NGOs that sent goods and volunteers via Air Asia

were Mercy Malaysia.

Corporate Social Responsibility (Community)

Dreams come true :

Air Asia collaborated with Children Wish Society ,

a 17-year-old girl suffering from terminal leukemia

to fulfill her dreams. She had made a wish to

travel to the holy city of Mecca before the cancer

took her life. However due to her condition,

doctors advised against travelling the long

distance.

Universiti Teknologi Malaysia

(UTM) and Air Asia Berhad (Air

Asia) signed a Letter of Intent to

provide special travel packages

and establish technical

cooperation in the field of

aeronautical engineering, apart

from executive programmers to

be conducted by UTM.

UTM AND AIRASIA SIGNED LETTER

It become all the more

important in cases where legal

or political have not helped the

causes and voluntary change

on the part of the individual or

society desired.

CONCLUSION

Societal marketing is gaining

importance worldwide as

people become aware of

social and environmental

issues both old and new.

http://www.airasia.com/my/en/corporate/irannualreport.html

http://www.dailyexpress.com.my/news.cfm?NewsID=52967

http://web.utm.my/today/index.php?option=content&task=vi

ew&id=788&Itemid=1

AIR ASIA Annual Report 2009

References