Ryanair Business Strategies

Strategic Management Group no: 10
Group Members -:1.

2. 3. 4. 5.
Mr Olayinka Oladeji Omojayogbe

Mr Abdueraouf Ebhialil
Ms Laura Lucbert
Mr Reaz Ahmed Mr Mohamed Mifras Mohamed Zain
INTRODUCTION

Founded in 1985 by the Ryan family Currently headquartered in Dublin, Ireland Michael OLeary took over in 1991 Currently the largest European airline, and the sixth largest airline in the world.
Started with two classes of seating, which are business class and economy class
The company changed its business model dramatically in the 90s, implementing costleadership strategy, utilizing disruptive innovation outsourcing strategy, and market
segmentation focus
Operate under its own new single fleet of Boeing 737-800 model type planes to keep aircraft maintenance cost low
Critical Success Factors (Activity Map) (2)
Critical Success Factors (Activity Map) (2)
Limited passenger amenities Reduced leg room, limited passengers luggage weight and have to pay for in-flight services.
Frequent reliable departures Averaged 1270 per day in Sept 09. Lean productive ground and gate crews Ticketing and check-ins mainly online. High aircraft utilization 2009, load factor averaged at 85%. Low ticket prices - on the basis of the demand, selling 70% of seats at the minimum available fare assigned for the route.
Short-haul, point-to-point routes Flying frequently to secondary and regional airports, with an average flight duration of approximately 1.2 hours.
Ryanair sustainability
Ryanair focuses on three areas:
Passenger Traffic 2002/2013
High volume : filling as many seats as possible. Michael OLeary, CEO says buy more and sell it at low prices (Felsted, Nov 2003) Load factor : number of seats sold as a proportion of those seats available on each flight. Ryanair flew 11.3 millions
passengers in 2003, 45 % up on 2002.
booking via internet (less administration costs), aircraft operated on tight schedules (every 25 minutes) allowing more flights a day.
Reducing every cost :
Ryanairs Cost Savings chart
Competitive advantages
Traditional

cut fares on short haul flights Scrap conditions on short haul flights Decreased cost on domestic flights :

Online bookings Ticketless boarding One class travel Unallocated seats
Larger aircraft, 1 passenger class Reduced in-flight service, internet booking
Low fares subsidiaries
Mixed model : full service vs. low cost
Focuses on low cost.
Revenue Generation

Ancillary services : car rental, travel insurance, accommodation In-flight services (captive audience) : online shopping, food & beverages, alliances, magazines
Flying to the secondary airports Point to point flying In house marketing No frills Reduced turnaround times No refund policy Corporate partnerships No cargo service Bargaining power New aircrafts Owns own fleet Operations denominated in euro Hedge fuel risk Highly successful ancillary service offering Outsourcing of services at 7 international Airports
Value Chain
EXTERNAL ANALYSIS : Porters 5 forces
Strategic Positions
Ryanair's strategic activity map.
Strategic Trajectories: Generic Strategies
Cost Leadership: Lowest Cost airline in Europe Uniqueness: Low cost full service airline. Innovative and focused.
Focus: Niche market/ focus
11
10
Red Ocean & Blue Ocean Strategies
12
11
Ryanair Blue & red ocean Strategy Matrix

Compete in Existing Market
Beat the Competition Create and Capture New demand
Break the Value-Cost trade off

Align the whole System of the Companys activities in pursuit of differentiation & Low-cost
13
12
Innovation strategy
Drop Cost Structure
Lifts Buyers Value
14
13
Key strategic trajectories

1985-1995
Low fare
Rapid Expansion Investment Efficiency High frequency flight Formula

Customer Satisfaction (e.g. Punctuality, Fewer flight cancellation; Less lost baggage; Stuffing and Control) Beat the competitors (e.g. Lufthansa) Use of Massive media Internet possessions
1996-2004

Rapid growth in UK market No 1 European Airline Europes largest booking website
2004 to present
Rapid Expansion in Europe
Sales and cost control

Profit maximisation
Complete Travel package (e.g. Ancillary, Passenger growth Hotel Accommodation; Travel Acquisition of new Boeings Insurance; rail services)
15
14
Conclusion
Ryanair is Europes only ultra-low cost carrier (ULCC), operating more than 1,600 daily flights (over 500,000 per year) from 57 bases, across 1,600 low fare routes, connecting 180 destinations in 29 countries and operating a fleet of 303 new Boeing 737-800 aircraft. Low cost, frequent flights, and other strategic innovation has helped the company to becomes Europes the largest airline service provider. Strategy, innovation and business model is the key to Ryanair's success.
16
15

Ryanair Business Strategies

Uploaded by

Copyright:

Available Formats

Ryanair Business Strategies

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Ryanair Business Strategies

Uploaded by

Copyright:

Available Formats

Strategic Management Group no: 10

Group Members -:1.

Mr Olayinka Oladeji Omojayogbe

Critical Success Factors (Activity Map) (2)

Critical Success Factors (Activity Map) (2)

Ryanair focuses on three areas:

Passenger Traffic 2002/2013

passengers in 2003, 45 % up on 2002.

Ryanairs Cost Savings chart

Online bookings Ticketless boarding One class travel Unallocated seats

Larger aircraft, 1 passenger class Reduced in-flight service, internet booking

Low fares subsidiaries

Mixed model : full service vs. low cost

Focuses on low cost.

EXTERNAL ANALYSIS : Porters 5 forces

Strategic Trajectories: Generic Strategies

Red Ocean & Blue Ocean Strategies

Ryanair Blue & red ocean Strategy Matrix

Break the Value-Cost trade off

Drop Cost Structure

Lifts Buyers Value

Key strategic trajectories

Rapid growth in UK market No 1 European Airline Europes largest booking website

Rapid Expansion in Europe

Sales and cost control

You might also like