January 10th, 2018
Case study on emirates – recommendations and conclusion
Recommendation for Emirates
Emirates success in the trans-Tasman route lies in generating efficiencies in its long-haul distance (Europe-Dubai- Australia – New Zealand). This would make it avoid price wars that characterize short haul distances such as trans-Tasman. Accordingly, the entity needs to:
- Continually market its New Zealand destination in Europe to generate higher passenger numbers from Europe to make up for the passenger numbers required for flights from Australia to New Zealand to remain profitable.
- Entrench its brand identity by augmenting its quality-differences with the dominant players in the trans-Tasman route. This will help Emirates to avoid losing out passengers destined for New Zealand who use Qantas and Air New Zealand to connect flights that use the Australia route.
- Avoid price wars with Qantas and Air New Zealand in the trans-Tasman route since they control a larger market share that allows them to compete effectively on a price basis.
- Seek agreements with regulators in Australia and New Zealand to avoid protectionist policies that may hinder its business in the two countries.
Strategic planning allows entities to adopt strategies that enhance their realization of opportunities present in a specific market. This paper evaluated the external environment that faced Emirates on its expansion to New Zealand in 2003. Using the porter’s five forces model and SWOT analysis the New Zealand market presented a credible opportunity for Emirates to expand its network by offering flights to New Zealand via Australia. For instance, the trans-Tasman industry allowed the entity to earn marginal revenue to reduce costs incurred when the aircraft would have remained idle in Australia as the crew rested. Unlike other new entrants who would be forced to make major capital investments to compete effectively with existing players, Emirates ownership of a large fleet allowed it to enter the market without having to invest on new aircraft. Despite such an opportunity, Emirates faced significant competition from existing market players such as Air New Zealand and Qantas who controlled a larger market share and could compete effectively based on pricing. Accordingly, Emirates needs to focus on marketing its long haul service from Europe to New Zealand, to avoid price wars that could arise with a focus on the trans-Tasman route.
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