You will answer the three questions below for Wednesday 11.59pm and comment two other students posts by Sunday 11.59pm. You must create a thread in order to view other threads in this forum. Answers will be provided with your next module. Ryanair clearly has a cost-leadership strategy. They are providing lower-value services and driving their costs low or generating revenues from fees other airlines are not charging to offset some of their costs. We chose Ryanair as an example of low-cost leadership to extend the chapter case discussion with a non-U.S. example. Students enjoy finding out about the Irish company and reflecting on how, in many ways, Ryanair is in the leadership position on cost and price structures. Ryanair based in Dublin, Ireland has been renowned in Europe as a firm that can make a profit on a $20 ticket by imposing numerous fees and surcharges. The airline has sought to be the lowest of the low-cost providers in the EU with a no frills get you from point A-to-B-model. Ryanair is on record as saying it wants to be the Amazon.com of travel in Europe by bringing in competitors price comparison, hotel discounts, and even concert tickets. Check out the company website (http://www.ryanair.com) and consider the questions that follow.

1a. If you were a competitor in the European market, such as British Airways or Lufthansa, how would you compete against Ryanair, knowing your cost structure would not allow price parity? If you were a low-cost leader like EasyJet, how would you compete against Ryanair?

1b. What similarities and differences do you find about Ryanair compared to JetBlue?

2. Suppose Procter & Gamble (P&G) learns that a relatively new startup company Method (www.method@home.com) is gaining market share with a new laundry detergent in West Coast markets. In response, P&G lowers the price of its Tide detergent from $18 to $9 for a 150-oz. bottle only in markets where Methods product is for sale. The goal of this loss leader price drop is to encourage Method to leave the laundry detergent market. Is this an ethical business practice? Why or why not?