Case Study Virgin Atlantic

Source: Virgin Atlantic/Rex Shutterstock.

As former Virgin Atlantic airline's marketing director Simon Lloyd was sitting in his office, he had two main marketing challenges in front of him as he prepared to write his strategic marketing plan for the coming five years which was then overtaken by Annabelle Cordelli1:

Keep consumers sufficiently delighted with the Virgin Atlantic brand to stay with Virgin rather than fly with the cheaper-priced competitor airlines.

Improve Virgin Atlantic's digital presence in a way that aligns with its luxury but fun brand image.

She is very aware that the market has changed, that economic recovery is ongoing, but that changing consumer behavior and digital developments mean that he must take a holistic view of his marketing, and re-envisage and change many practices and processes in both the digital and offline worlds. She understands that customers are at the core of Virgin Atlantic's business. Firstly, she commissions the deep research and analysis needed to design a marketing plan to bring the company through the next five years.

Virgin Atlantic is a small airline with a big personality. This is how it lures customers from the main competitorsonitsroutes.2 EventhoughitisnumbertwointheUK,itistinycomparedwithitsAmerican- based competitors, including United Airlines, American Airlines and Delta. The question is, how does it compete when it has only 18 departures a day and how does it continue to grow?

The company doesn't have a huge marketing or digital marketing budget, so it must stay closer to its customer and be cleverer about how it markets its service. It also has an infrequent customer base, with customers usually flying only once or twice a year, so the challenge is to maintain a relationship with them in between flights.

Customer rather than product focus: Virgin Atlantic first looked at who its target market customers are. Internally it describes them as mavericks, adventurous, pioneering or 'fearless leaders'. So Virgin Atlantic focuses on this target market and makes its interactions with the company both fun and cool, like an ultra-cool, upmarket but boutique hotel. It has installed an on-board bar, passenger massage and nail bar, and top-quality food and drink.

Focus on customer advocacy: within its marketing plan its aim is to make Virgin Atlantic the world's 'most irresistible' airline. It understands its customer: 'Our research shows that there is a new mindset in today's business traveler. They're not just a business person on their way to a meeting, but an individual thinking about making the most of every opportunity they find themselves in,' said Chris Rossi, senior vice president, North America, Virgin Atlantic.

Digital fun: the company is focusing on lots of innovative and playful initiatives in the digital space. Within digital they are moving away from TV and videos to content as king and managing the consumer conversations in real time on social media and other digital devices. It teamed up with BBC America to target the 678,000 expats living in America with an online support social network. Nick Ascheim, SVP Digital BBC Worldwide Americas, says about the joint venture with Virgin: 'We'll provide an entertaining and informative steer for Brits looking for answers to questions on topics from how to get a driver's license to how to blend in at Thanksgiving dinner, and even tackle more complicated American issues like the Kardashians.

After its first year, 66 per cent of users said they were likely to choose Virgin Atlantic for their next flight and the online campaign earned nearly 1m revenue in year one.

The customer-focused challenger mentality is critical because most service offerings are the same and a marketing philosophy of putting the customer at the center is core. As Simon Lloyd, former marketing director with Virgin, noted: 'The skies are being filled with lots of different carriers and it is becoming commoditized - the product across most airlines is very good. The one thing that sets us apart is our people. We want to concentrate on continuing to provide the best service, but not in a way that is robotic; rather, something that does allow the personality to come through. What we can offer that no one else can is that truly unique Virgin Atlantic experience, and that's what people buy in to . . . Price is obviously a consideration, but you want it to be secondary to choosing to travel with us', he says. 'I truly want to make this airline so irresistible to our customers that people will want to fly with us because they know they are going to have a great time.

The company's marketing plan in this tough business climate must make its service 'irresistible' to the travelling public and this is possible only through developing a deeper relationship with its customers.

Virgin focuses on the human touch and warmth with the customer as the true competitive advantage in business. It hopes that the strength of the Virgin Atlantic brand, the strength of the management team, the strength of its marketing plan and a new focus on digital and relationships will protect the brand in the challenging aviation market. Always looking for innovations, Reuben Arnold, current senior vice president of marketing and customer experience at Virgin Atlantic, has teamed with Delta Airlines and has opened a new lounge as a celebration of their transatlantic network. He says: 'Our lounge bar will offercustomersabrand-newexperience...thatshowcasesourairlines'world-classservice.'8 Virginis always looking for new ways to enhance its image and grow its brand in every customer interaction, whether face to face or digitally.

Questions

1) Would you consider Virgin Atlantic to have a marketing philosophy?

2) What are the core management skills needed in marketing for VirginAtlantic?

Kindly answer the above questions