EasyJet PLC is a low-cost airline with headquarters at the London Luton Airport. The company was established by Stelios Haji-Ioannou in 1995 (BBC, 2002). The airline operates both international and domestic flights to more than 1000 routes in thirty nations (easyJet, 2019). Since its inception, the company has acquired various smaller companies to expand its routes, fleet size, and company size. The main routes of the company are in the UK with the majority of employees posted there. The total number of employees in the company is nearly 14000 (easyJet-2, 2019). It is one of the largest low-cost airlines in Europe and the demand for low-cost flights continues to rise. The company has numerous subsidiaries in the region. In 2018, the company generated revenue of 5.898 billion Euros (easyJet, 2018).
Following are the four dimensions of the Ansoff Matrix for EasyJet:
Market Penetration
EasyJet works to increase the sale of its existing products in existing markets in various ways. The first strategy that Easyjet makes use of is loyalty programs. It offers its passengers a chance to save even more by becoming loyal members and flying more often. The company also works to attract business flyers and first-class fliers to use its low-cost services as compared to paying higher prices with other airlines. The company also works to improve the services it offers by reducing the time to process customer check-ins, creating ease in purchasing tickets, creating access to available services, and so on. The company also acquires various smaller airlines to increase its market share in the region. It has strategic alliances with various hotels and resorts to promote their tourism activities. During holiday seasons, prices even further lowered to attract consumers. Marketing and advertising its low-cost tickets is another market penetration strategy the company uses. All of these strategies help increase sales.
Market Development
Market development refers to the launch of existing products in new markets. The easiest strategy for EasyJet in this regard is to expand into new geographical markets. This includes new destinations within the countries it is already operating in and to countries it does not currently fly to. This will help increase the number of destinations and countries the company flies to. The company also offers new packages including different luggage capacities, new facilities, and so on to create new market segments within its existing markets. It also offers different prices within the low-cost segment to target new market segments. With the help of either of these strategies, the company can expand into new markets with its current product range.
Product Development
When new products are launched in existing markets, the action is referred to as product development. The first strategy that EasyJet uses for its product development is to improve its existing products in terms of offering better facilities at the existing rates. This can include better meals, more leg space, and so on. The company also launches new services such as low-cost business class, executive class, and other various similar services. Other new products EasyJet launches are in the form of different aircraft flying on various routes (Hanlon, 2019). On certain routes, passengers are allowed to select the aircraft type they want as each model offers different functions and comfort level. EasyJet is a market leader in the low-cost airline segment in Europe. To maintain that status, the company has to work on its research and ensure that it works on its product development regularly. This helps gain greater sales as the new products are advertised across all destinations.
Diversification
The company has various diversification opportunities. The first is that it can vertically diversify and work on becoming its own supplier for the various goods and services the company procures from suppliers. It can also horizontally diversify into premium air services, luxury flights, chartered aircraft, and other similar services. It can also develop its own airport and charge fees from airlines using its airport. This will also help increase revenue. The company can also become a conglomerate by entering other industries such as tourism, hospitality, shoes, consumer electronics, and various others. This will help diversify the business. However, this is a risky strategy as the brand is already associated by customers with low-cost services. This will require brand repositioning to enter other industries.
References
BBC, 2002. Easyjet buys Go for £374m. [Online] Available at: http://news.bbc.co.uk/2/hi/business/1990691.stm [Accessed 07 Jan. 2020].
easyJet, 2018. Results for the year ending 30 September 2018. [Online] Available at: http://corporate.easyjet.com/~/media/Files/E/Easyjet/pdf/investors/results-centre/2018/easyjet-fy-18-release.pdf [Accessed 07 Jan. 2020].
easyJet, 2019. Route Map. [Online] Available at: http://www.easyjet.com/en/routemap [Accessed 07 Jan. 2020].
easyJet-2, 2019. Our People. [Online] Available at: http://corporate.easyjet.com/corporate-responsibility/our-people [Accessed 07 Jan. 2020].
Hanlon, A., 2019. The Ansoff Model. [Online] Available at: https://www.smartinsights.com/marketing-planning/create-a-marketing-plan/ansoff-model/ [Accessed 07 Jan. 2020].