Service Marketing of JetGo Australia

Question: Discuss about the Service Marketing of JetGo Australia. Answer: Introduction Creating value for customers fundamentally increases the competitive advantage for any business firm and the very rationale of business is to generate loyal customers for the enterprise. The purpose of organizations is not only to concentrate on making profit but also to satisfy the requirements and desires of the consumers to do that they must strive to develop a strong relationship with the consumers. It has been seen that the firms that are good enough to satisfy consumer needs possess the best opportunity to develop and prosper. Besides, in the changed marketing technique, the customized marketing has replaced the earlier concept of mass marketing. For service companies, especially it becomes the core requirement to work for the target customers so that they are compelled to come back. This personalized service delivery leaves the consumers with an impression of excellence and forms the bond of understanding between the organization and the consumers (Daley, Martin and Cook 2015) . The chosen service providing organization for this assignment is JetGo Australia and the purpose of the assignment is to investigate customer relationship marketing program of this relatively new aircraft carrier enterprise in the market. Based at Brisbane, Queensland JetGo Australia is a regional air charter and airline company founded in 2011. This domestic airline provides flight service mainly in the Eastern states of the country as well as provides charter services, chiefly in the operations of fly-in fly-out (FIFO) supporting the resource and mining sectors. Commencing with charter services in 2012, JetGo Australia now provides regular passenger flying services too and currently it has five passenger flyer aircrafts to fly within 12 destinations (jetgo.com 2017). This comparatively new airline company has surprised all others by offering a high standard of customer service. In fact, it has been referred to as a point-to-point regional routes aviation service provider crafted with a difference. Since it is a new and small airline company, it does not yet have a strong relationship marketing program but interestingly its new ventures has made a lasting impression on the consumers. In fact, their best-in class jet service with super comfortable journey provisions and some other customized features incorporated in it makes it more preferable to the consumers over all other regional jets (jetgo.com 2017). Benefits of a Valued Relationship In the aviation industry, customer experiences lie in the core as without having customers as flyers the airline companies cannot sustain. Therefore, almost every aviation enterprise strives to offer personalized services as well as includes their needs and wants in the service delivery (Christopher, Payne and Ballantyne 2013). Now, as for JetGo Australia, it has started flying operations especially the regular passenger flying service very recently. Yet it has developed a value relationship with the customers within this short period. In the first place, it should be investigated what particular strategies JetGo follows to improve their customer relationships and creating a value out of that. Although the carrier crafts are few in JetGo, these flights offer super comfortable in-flight services and are full of best in class amenities. The seats have ample width comfortable to sit with enough legroom, more like business class features in the larger airlines of that of VIP Corporate je ts. Besides, the flights travel really fast, due to which the airlines is benefitted with more customers who prefer JetGo whenever they have to travel on emergency basis (jetgo.com 2017). The business class features in domestic flights has been on demand in reasonable price range and since JetGo successfully offers this, it fetches more customers for the airlines. Another important aspect creating value relationship with the customers is the professional and extremely attentive behavior of the flight attendants and the ground staff. This further ensures that passengers have a personalized experience on and off board. The other aspect by which JetGo takes initiative to manage relationships with customers is by its promotional offers and follow-up e-mails. As many of the airline companies do, JetGo in order to make their passengers feel special and exclusive sends promotional and discount offers to them and even suggestions of the best flight in need that would suit the purpose of tha t particular customer (Daley, Martin and Cook 2015). This is perhaps the best example of personalized service where they do both promotion and gain the customer loyalty as well (Pritchard and Howard 2015). The follow up mails, on the other hand have different purpose; these are sent to a passenger within 24 hours of his flying asking his experience of flying with JetGo and even they have a rating system where the flyers can rate their experience. This is intended to enhance the effectiveness of the existing flying service and to gather information about any additional demand on the part of the customers that they would prefer in their next flight. These follow up mails as a part of their communication strategy along with the follow up phone calls found the base of their relationship with the customers. However, this constant follow-ups and other relationship management planning would not have helped unless JetGo had implemented these knowledge in their service. As a result, all this personalized service management has created several benefits for the airline enterprise. Their valued relationship with the flyers helps them to retain the customers and naturally, it has emerged as one of the most preferred domestic craft carriers. Moreover, the company is benefitted with more references from their satisfied customers adding money to their business. Perhaps the greatest benefit of this relationship management programs are the acquired customer loyalty and thereby increasing profitability in the business. Besides, this boosts the confidence level of the employees and the organization overall making them feel that they are on the right track. In addition, the value relationship between the customers and the airline service providing company creates a holistic scenario of the market enabling JetGo to have a deep insight into the customers mindset and preferences. In fact, understanding the customers needs the airline has initiated a joint venture with Art Series Hote l Group that offers luxurious amenities of a boutique hotel to the passengers of JetGo airline at a discounted price (Jameson, J. 2016). Apart from these, satisfied group of customers provides the company with a competitive edge over other regional airlines of the same class as JetGo. The credit for this goes to the customer service section of the airline where the employees themselves tend to build relationships with the consumers not allowing the competitors to enter the place of their sustainability. Targeted Market Segmentation In order to build a value relationship with the customers JetGo airline must identify the potentials customers to target and this is possible only through proper market segmentation. The existing market segmentation model divides the market into divisions like demographic, geographic, psychographic, lifestyle, values and beliefs, life stages, behavior and benefit (Desai, Siddique and Yaseen 2014). Among these, it has to be analyzed which market segmentations should to targeted by JetGo to determine their potential customers as well as investigate why this targeting of potential customers is essential to form a successful relationship marketing program. Demographics The demographic segmentation breaks down the targeted customers in terms of age, income, gender, ethnicity, education, marital status, profession or occupation and the like. Considering these aspects, JetGo must target the demographic segmentation as the market research says profession or occupation and income aspects are more or less rigid for the airline (PandÃ… ¾a Bajs 2015). It has been seen that passengers of a particular income group tend to fly through JetGos premium services and that too in the regional areas. The demographic segmentation of JetGo has helped to identify some more categories of flyers such as urgent flyers and business travelers. The urgent flyers are rather infrequent flyers, generally those who have an urgency to travel somewhere. These urgent flyers are usually those who have some imperative work situation or have a sick relative that requires immediate attention. Given this need to travel on urgent basis, the flyers prefer to travel with JetGo as their flights go faster and also they have some direct flights to some faraway destinations while the major other airlines go via Sydney. This attracts the consideration of urgent flyers and thus suits the purpose of JetGo (Jameson, J. 2016). Although the urgent travelers form a small proportion of customer base for JetGo, the business travelers form the major market segment. Australia has numerous business operations in different parts of the country and this necessitates the need for people associated with business to fly fre quently with JetGo. These business customers generally form an organization-wide decision when it comes to choose an airline rather than as individual travelers being involved in the airlines choosing decision (Peck et al. 2013). In this context, the income segmentation also comes in the scene, as the well off customers like business people and others are seen to mostly avail the flights of JetGo. Undoubtedly, these customers are moderately brand loyal in terms of choosing airlines and are rather price insensitive, especially advantageous for JetGo that offers flights at a premium price range. Geographic The geographical segmentation is drawn down in terms of region, area, rural or metropolitan location, density of population and the like (Peck et al. 2013). Now, as in the case of JetGo, the geographic segmentation has immense importance in determining potential target customers. It has been seen that flyers usually travel to those areas where either they have residence or business set up. In that sense, the flyers from New South Wales or Queensland or Melbourne, Victoria have the best chance to choose JetGo when in need to fly. Although in Melbourne, there are so many flights of larger airlines available, that JetGo has comparatively less chance to be chosen but in other location, especially for domestic flyers JetGo can emerge as the best choice. Apart from these, targeting the customers of the locations where JetGo exclusively provides direct flights can be profitable for the airline (Shaw 2016). Benefit The benefit segmentation centers on the users perspective of satisfaction and benefit after availing the service. For JetGo, the customers have been seen extremely satisfied with the flying experience they have and the faster flight service offered to them. As for the benefit in comparison to price, the flyers of JetGo are not bothered by this. They rather prioritize the on-time arrival and in-flight comfort that is offered to them. Thus, the familiar STP model of marketing is, in fact very useful to create plans for marketing communications, as it will assist the marketers of JetGo to prioritize suggestions gathered from customer feedbacks and thus deliver relevant and customized services to engage the consumers even more (Bahn and Rao 2015). Through segmentation, a company can identify the niches in terms of specific needs; develop effective marketing message and thereby delivering more focused services. The market segmentation is thus a consumer-based approach strengthening the relationship between JetGo and its customers even more. Required Management strategies Before suggesting the required management strategies, the customer services of the company JetGo needed to be discussed. According to the article by Daily Liberal Australia published on 6th June, 2015, the JetGo Australia announced about the lower fares as to $99 for the first time for the service marketing and promotion purposes. The promotional fare has dragged various customers to the company. According to the article, the company JetGo Australia has adopted some cautious approaches for acquiring a big customers base for the development of the market share in Australia. Along with that, the report reveals that, the company has adopted various security supports for the better services to the regular passengers in Australian and especially for Brisbane. The company use to properly communicate with their customers regarding various issues during flights and booking processes. Reports also suggest that, the company always thinks about their customers and focuses for better customer se rvices. In this strategic ways they have developed a different market with various other characteristics for the aviation business which differs from the tourism perspective (Dailyliberal.com.au 2015). Another article by Essendon airport, the JetGo Australia can be considered as the surprising airport serving the customers with a level of facilities by their aviation business. The company has adopted the strategy to take up such destinations which are not entertained by various other big operators in the market. The company has established their planes with the strategies to make their customers comfortable along with value worth services. The company has minimized the hassles if changing flights in various ways (Essendonairport.com.au 2017). Therefore, the company is operating their business with a mind of better customer services in the country Australia. Though the company is new in the aviation industry, but they have gained a lot of faith from their customers. However, the airlines industry in various countries has adopted many innovative approaches for the relationship marketing purpose. According to the articles discussed above, it can be concluded that, the company JetGo has developed various strategic models for their business operations to develop an innovative business plan to get more market share. The company can be considered as a creative customer centric organization in Australia. However, the intangibility, inseparability and variability are few characteristics of the service industry hence there are requirements of some specific strategies to enhance the customers relationship of JetGo Australia (Mok, Sparks and Kadampully 2013). Here are some suggestions for the company JetGo Australia to develop a relationship marketing program. Through this program, JetGo Australia can have some major steps to build better relationships with their customers (Armstrong et al 2014). Promotional offers: Customer relationship management is a major job for all the service organizations. In the services marketing the companies usually works for the better relation build up in the B2C along with B2B businesses. The service marketing contents various promotional approaches along with creativity and innovative ideas in the business (Wu 2014). The value creation and the loyalty among the customers and the companies are built up on the Supply-Demand logic. However, the promotional offers are now days becoming very common among the Australian Aviation firms, but there are opportunities of innovation in such branches of service marketing. For this purpose, the company can adopt few loyalty programs such as gifts and promotional offers to the customers on their ceremonies, birthdays and some other life events. In the promotional offers they can notify the customers few weeks before the date of event about the discounted tickets for the entire family. This approach will enab le their services to the familiarities of their customer bases. Along with that, such strategies will help them be identifiable among the other various companies in the market. In General, the promotional marketing campaigns always keep a specific purpose for the business. Here, JetGo Australia needs to concentrate on the purpose of long term customer loyalty and increase in the customer base. Membership packages: For the long term profitability purposes, the company can introduce some membership programs for few years in airlines packages similar to the tourism packages. With this strategy, the company can offer their customers a membership card through which they can avail many discounts for next few years. Along with that, the cards can be categorized as premium, general and valued categories. This strategy will be creative enough to get new customers and the regular customers for their business. However, the construction of the membership packages will depend on the usage and travel habits of their customers. If their customers use to have frequent travels in a year, then the membership package should be constructed as per the yearly discount base. If the customers use to have very few travel but with entire family members, there should be memberships as on the number of the passengers based. Such membership will enable the customers to enable more discounted tickets f or more numbers of the passengers from their family. However, in such cases, the crews should treat them with extra preferences and extra facilities during the flights (Hunt 2014). Optimum service quality: The concept behind service quality is explained with the analysis of the perceived performance and the perceived expectation. The concept of optimum service quality originates the expectancy and the disconfirmation paradigms. The empirical studies with improved quality in services define the strategies towards the profitability and the customer satisfaction. The company can improve their service quality to optimum level with a low profit margin. This will enable the company to acquire better market share in the industry. The theories behind the service marketing discusses about the GAP model which was developed in the year 1985. The GAP model differentiates the actual service quality and the expectation of the customers. This GAP model can be used for the purpose of enhancing the customer service of JetGo Australia in the Aviation industry. The reliability, competence, access, effective communication system, security arrangements are some of the parameters th at are needed to be maintained in this purpose. The optimum service quality can be enabled by measuring the approaches of an organization towards their customers. However, the purpose will help in achieving the objectives of the organization (Goetsch and Davis 2014). Valuing the stakeholders: In relationship marketing, the valuation of the stakeholders is very much necessary. However, the valuation process differs due to the type of the business, the approaches of the business models and the management practices by the organization in a particular sector. In the Airlines Industry of Australia, the companies use to face tough competition in the market. Along with that, the media and other stakeholders approaches towards the service quality and management policies can criticize the business opportunities in the marker. The aviation business is considered as a global business in the industry. Thus, there are various factors need to be considered for the purpose of valuation of the stakeholders in this context. The strategies for this purpose should go with the image building of the organization as a Customer centric company. However, there are few things that should be considered also namely collaboration among the stakeholders, shareholders and the people of the organization, transparency in the business operations, valuation of the approaches by the stakeholders and its influences. These strategies will also help the organization in increasing the profitability in the market. Usable Marketing Metrics The theory of marketing metrics use to have various elements of measurements including the sales and the number of the products and the effect in brand awareness. The monitoring and the analyzing process with the help of marketing metrics enhance the competitive intelligence. Along with that, it enhances the market strengths of an organization and strategizes the process of minimization of the weakness. However, the metrics can be used to measure the effect of the strategies of marketing mix (Farris et al 2015). The marketing metrics works on the numeric data collected regarding the core strategic business processes. The numeric data allows the organization to interpret the realistic facts regarding the effectiveness of the strategies applied for a particular purpose. There are major 5 metrics for the measurement of this service marketing strategies as mentioned above. The metrics are as follows Return on Investments (ROI) The business operations always focus for the returns they get from the investment in the core business operations. However, the ROI can be required to measure the impact of the services marketing and the customer loyalty measurements (Gummesson, Kuusela and Nrvnen 2014). The strategies as mentioned above can be taken under control over the return on the investment as put by JetGo Australia. ROI is the most useful formula and it is considered as the easiest way to understand the capacity of a particular strategy in the business. The formula of ROI is, ROI = (Net profit/cost of investment) * 100 CPA (Cost per Action) The CPA is referred as the Cost per acquisition or Cost per Action. The formula of the cost per action measures the amount of the conversion that a business paid for the implementation of a particular strategy. The CPA is used to define the viability of a particular marketing strategy which helps in organizing the specified actions for marketing campaigns. The measurement by the CPA helps in minimizing the risk of the investment done by the company for the purpose of the marketing campaigns. The formula of the CPA is, CPA = (Cost / Conversion) Customer Satisfaction Customer satisfaction is a major marketing metrics for the purpose of the customer relationship marketing in the aviation business. The theory of the metric beliefs as the more satisfied customers means the more opportunity for the growth of the business in long term. The customer satisfaction can be measured with the feedback analysis program, which is a necessary KPI for the relationship management program for the service industry. Customer Lifetime Value (CLV) The CLV metric is used for the determination of the economic value that is brought by a customer to the business. The measurement of the valuation of a customer is on a time constraints and the consideration should be given to the long term participation of the customers in the communication channels. Thus, the marketing channels which show high value should be specified to give more importance regarding the customer services and supports. This metric can also be used for the evaluation of the success base of the company. Customer Retention Rate The customer retention rate is very necessary for the purpose of measuring the customers loyalty for the long term benefits in the business. However, the acquisition of the new customers also depends on the customer retention rate in the business. In researches it is found that, a company puts effort of 10 times to acquire new customers with low retention rate of previous customers. The purpose should be strategized with the dedication of the previous customers in the higher loyalty ratios. The life cycle of the business also depends on the customer retention approaches by the organization (Gunawan 2015). For the purpose of the Promotional offers, the metrics that will be used are the Cost per Action and the Return on Investment. For the purpose of the Membership packages, the metrics that will be used are Customer retention rate, Customer Lifetime value and Customer satisfaction. For the purpose of the Optimum service quality, the metrics that will be used are the Customer retention rate and the Customer satisfaction. For the purpose of the Valuation of the stakeholders, the metrics that will be used are the Customer Lifetime Value and Customer retention rate. Conclusion Thus, customer relationship management has a variety of shades and in the business environment of airlines it is considered as a crucial component. The greatest advantage of building a valued relationship with customers is earning their loyalty for the airline. Perhaps this is the reason why the airlines companies emphasize on building personalized relationships with the customers that stands value for them. Especially for JetGo, being a new enterprise in the aviation industry, to compete with other established and large airlines it is indeed essential for JetGo to concentrate on customer relationship management in order to build a strong consumer base of their own. Apart from this, the market segmentation of JetGo will serve the company to identify the potential target customers for the airline and thus, will enable them to maximize the value of relationship with customers. The report has assessed regarding various strategies essential for the prospect benefits of the business in the segmentation, targeting and positioning purposes. The study has gone through several marketing strategies to obtain the measuring ways and tools for the outcome from the recommended strategies. The marketing metrics are discussed in this report. It can be concluded that, the company JetGo Australia has implemented a range of strategies to make the clients contented in flights. However, there are additional strategies accessible for augmentation in the business. Along with that, the report concludes that, the suggested strategies will be fruitful for the purpose of the relationship marketing program of JetGo Australia. References Armstrong, G., Adam, S., Denize, S. and Kotler, P., 2014.Principles of marketing. Pearson Australia. Bahn, K.D. and Rao, A., 2015. Characterizing Market Segments for a General Aviation Airport. InProceedings of the 1986 Academy of Marketing Science (AMS) Annual Conference(pp. 308-312). Springer International Publishing. Christopher, M., Payne, A. and Ballantyne, D., 2013.Relationship marketing. Taylor Francis. Dailyliberal.com.au. 2015. JETGO to fly us to Brisbane. [online] Available at: https://www.dailyliberal.com.au/story/3128619/jetgo-to-fly-us-to-brisbane/ Daley, J.M., Martin, J.H. and Cook, W.E., 2015. Airline Passenger Service Preference: A Comparison of International and Domestic Users. InProceedings of the 1987 Academy of Marketing Science (AMS) Annual Conference(pp. 207-210). Springer International Publishing. Desai, S.S., Siddique, C.M. and Yaseen, Z., 2014. Segmentation of Airline Market in the GCC Region: Profiling Business Customers Using Low Cost and Full Service Carriers. InInternational Conference on Technology and Business Management March(Vol. 24, p. 26). Essendonairport.com.au. 2017. Jetgo | Essendon Airport. [online] Available at: https://www.essendonairport.com.au/operators/aviation-operators/jetgo Farris, P., Bendle, N., Pfeifer, P. and Reibstein, D., 2015.Marketing Metrics: The Manager's Guide to Measuring Marketing Performance. FT Press. Goetsch, D.L. and Davis, S.B., 2014.Quality management for organizational excellence. Upper Saddle River, NJ: pearson. Gummesson, E., Kuusela, H. and Nrvnen, E., 2014. Reinventing marketing strategy by recasting supplier/customer roles.Journal of Service Management,25(2), pp.228-240. Gunawan, A., 2015. The Role of Service Marketing Elements on Customer Loyalty towards Garuda Indonesia.iBuss Management,3(2). Hunt, S.D., 2014.Marketing Theory: Foundations, Controversy, Strategy, and Resource-advantage Theory. Routledge. Jameson, J. 2016. Airline review: JetGo Melbourne to Port Macquarie. [online] Newcastle Herald. Available at: https://www.theherald.com.au/story/4331138/airline-review-jetgo-melbourne-to-port-macquarie/?cs=34 [Accessed 3 May 2017]. jetgo.com 2017. Take The Jet. [online] Jetgo.com. Available at: https://www.jetgo.com/ [Accessed 3 May 2017]. Mok, C., Sparks, B. and Kadampully, J., 2013.Service quality management in hospitality, tourism, and leisure. Routledge. PandÃ… ¾a Bajs, I., 2015. Tourist perceived value, relationship to satisfaction, and behavioral intentions: The example of the Croatian tourist destination Dubrovnik.Journal of Travel Research,54(1), pp.122-134. Peck, H., Christopher, M., Clark, M. and Payne, A., 2013.Relationship marketing. Taylor Francis. Pritchard, M.P. and Howard, D.R., 2015. Measuring loyalty in travel services: A multi-dimensional approach. InProceedings of the 1993 World Marketing Congress(pp. 120-124). Springer International Publishing. Shaw, S., 2016.Airline marketing and management. Routledge. Wu, H.C., 2014. Maintenance and measurement of service quality.Service quality management, p.8.