EASYJET'S E-COMMERCE STRATEGY ANALYSIS

I. Introduction to the company and its industry

1. Company Overview

It has been recorded that easyJet is one of the most refuted British tour operators which has been successful in cutting a niche on the market. It has been able to cut competitive price edge which has been attributed to strict management of the cost by bypassing intermediary agencies that increased the cost of management. The company has also been able to successfully use non-saturated airports which have been on of its cost cutting measure that it has taken.

It has been recorded that easyJet is one of the most refuted British tour operators which has been successful in cutting a niche on the market. It has been able to cut competitive price edge which has been attributed to strict management of the cost by bypassing intermediary agencies that increased the cost of management. The company has also been able to successfully use non-saturated airports which have been on of its cost cutting measure that it has taken.

easyJet keeps costs low by eliminating the unnecessary costs and ‘frills’ which characterise ‘traditional’ airlines. This is done in a number of ways:

- Use of the Internet to reduce distribution costs easyJet

- Maximising utilisation of each aircraft reduces the unit cost.

- Ticketless travel Passengers instead receive an email containing their travel details and confirmation number when they book online.

- No free lunch Eliminating free catering on-board reduces cost and unnecessary management.

- Efficient use of airports easyJet flies to main destination airports throughout Europe, but gains efficiencies through rapid turnaround times, and progressive landing charges agreements with the airports.

- Paperless operations : The management and administration of the company is undertaken entirely on IT systems which can be accessed through secure servers from anywhere in the world enabling huge flexibility in the running of the airline.

- easyJet favours an informal company culture with a very flat management structure, which eliminates unnecessary and wasteful layers of management.

2.   Present Position Analysis

a) Strengths

The company has been able to cement its operation in the market based on some strength which has been acquired from its operation. The following are the points that represent its strength in the market

•                The airline draws strength from good reputation

•                The company offers a range of service which is a good cause of customer support point.

•                The company has exploited the web very well

b) Weaknesses

•                One of the weakness that has been dragging the operation of the company has been the fact most of those who are computer illiterate are unlikely to book from the airline since it has cantered its operations on the internet.

•                The risk of internet hacking

•                There is a weakness in the sense that not all people have access to internet

3.   Target analysis

Likewise, easyJet.com also targets the business and leisure consumers who are not interested in dealing with third party intermediaries. The target audience is keen on saving time and money.

4. Brief analysis of the competition

Main competitors in the industry are : British airways, British midland and Ryanair. But easyJet also have to face website competitors such as lasminute.com or expedia.com (tourism website)

Industry Analysis Airline companies matrix 

Porter’s five forces concerning easyJet company are analyzed below :

II. Evaluation of the use of e-commerce

1. Operational difficulties encountered by easyJet

a) Before

- There was only a customer service via call center, a phone number to book flights.

- “Easyland” call center was overwhelmed before the website birth

- Having only a manned call center doesn’t suit to the strategy of low-cost flights.

- Website with just some information about the company

b) After

- Automated service via on-line trace and track functionality

- Thanks to the website, Easy Jet has done the transition: upstart airline to Europe’s leading low-cost carrier

- First airline company to provide only Internet-promotions

2. Goals of the project

a) Abstract

- Cost lower : reduce call centers

- Develop the Web site of easyjet.com.

- Offer real time promotions.

- Take advantage of internet to change the business model.

- To offer customers a reasonable choice of flights

- Be more competitive on the market

b) Concrete

- Simplicity : no heavy design

- No concerns with « stickyness »

- Fast transaction execution

- Security of transactions

- Integration of GO web site

3.  E-Marketing strategies

Because the Internet provides the most cost-effective distribution channel, easyJet has aggressively pursued its strategy of encouraging passengers to book their seats online.

Here are some examples of the ways in which easyJet encourages people to book via the Internet:

– In their first promotion which was run in The Times in 1999, some 50,000 seats were offered to readers and 20,000 of them were sold on the first day, rising to 40,000 within three days. However, risk management did occur with a microsite built for Times readers (www.times.easyjet.com) to avoid putting a strain on easyJet’s main site.

– The web site also acts as a PR tool. They used its immediacy to keep newspapers informed about new promotions and offers

– easyJet first pioneered the concept of offering a discount to Internet customers, an initiative that has been widely copied by competitors. Any easyJet promotions are exclusive to the Internet, so that customers must get online if they wish to take advantage of discounted fares.

– On their website they added new services which are all meant to attract the customers. They started developing their sites in order to come up with diverse service like car/hotel/trip booking, EasyJetHotels, EasyJetHolidays,

Since easyJet started selling seats via the Internet in April 1998, the airline has enjoyed dramatic growth in its online sales.

The proportion of all sales made online has also shown impressive growth. easyJet now sells around 90% of its seats online every week which is a higher percentage than any other airline, reinforcing its position as the “web’s favourite airline”.

4. Website evaluation

Building e-business focused web content requires deliberate business as well as technological considerations. 

easyJet.com in terms of an online travel resource is a comprehensive web site designed to deliver a host of services without redundant graphics or advertisements to distract its visitors.
For example a visitor booking a flight will first insert the date of travel, destination, and check for its availability; then moves on to make the final booking/purchase. There is enough information on each page to support the requirement of the visitor without abstract marketing banners to detract real buyers. Unlike its competitors’ web sites like www.lastminute.com or www.bahn.de, easyJet.com concentrates on usability and reliability of information (Nielson 1994) rather than visibility and colourful display alone. However, this is not to say that the web site lacks colours. The use of orange colour throughout the web site is consistent with easyJet’s own corporate colour code so that clients can associate with easyJet the airline company, which is a critical aspect of web site development.

Layout and design

The website’s visual appearance, layout and structure, attractiveness, organization and, proper use of fonts, colour and use of multimedia play a major role in visitor’s impression about the website, the products and service it offers.

The major colour of easyJet website is the orange, since orange is the distinctive corporate color for the easyJet company. Green is also used to emphasis their care about environment and fuel saving as its one of the EasyJet Company concerns.

Simple graphics appears in the symbols for different topics in the website. Photos for hotel, some cities and cars are used related to page displayed. In my opinion it’s good not to use so sophisticated multimedia like animation flash which could be annoying to the customers if used extensively and it could affect the performance of the website and the speed of website response.

Flexibility

The flexibility of an e-commerce website depends on the options of online payment channels, searching and returning products functions.

In easyJet website many payment options are available for the customer (9 types of payment cards are accepted)

Accessibility

Website download and opening response speed is good and depend on the internet speed as well. But I noticed that when the website offered a sale on its tickets for few hours or days, a huge number of customers were requesting the website as a result the website speed was not as good as usual, and navigation between pages was slow too. There were no good handle for huge number of hits on the website.

When searching for “Cheap flight Europe” using Google search engine the easyJet website was the fifth option, and for “Cheap flight UK” it was the seventh option.

services it offers, which would contribute to appeal to those users who look at other websites that offer similar services but which lack the service quality that this website has.

Responsiveness

Main pages of the site are also very fast to be opened, perhaps in part due to the fact that for most of the main pages the website has special sub domains, for instance when the user is interested on Hotels and clicks “Hotels” from the menu, then the user is redirected to http://hotels.easyjet.com

Same thing applies for other main parts, in this way the bandwidth is handled properly, so even if the influx of the users is big, it can be handled with high responsiveness.

One of the main factors of good responsiveness is also good design. Easyjet.com is properly designed by not having much unnecessary media which slow down the downloading process and by using proper forms where users input the data.

Web Site Physical Accessibility of easyjet.com

While easyjet.com does not have special portal for people with special needs, we think that the design generally satisfies most users including those with moderate disability who enter the site. We will briefly explain some of the Web Content Accessibility Guidelines in relation to easyjet.com.

The webpage does not have the audio feature which would read the text for users with reading disabilities.

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In the case of easyjet.com, which is an online website for an airline agency, the importance of website evaluation is high due to much interaction between the system and its users. Many users across the globe might visit the website and book tickets for their travels. This requires consideration of different aspects given the diversity of users and their backgrounds. For instance, users might possess different skills of using computers and internet applications. This requires designers to provide an easy-to-use and understand interface that makes it possible for anyone to use the website without having any barriers to interact with the system or perform any activities like booking a ticket or managing ticket reservation. Such possibilities should also account for easy navigation, attractiveness, playfulness, etc.

III. Recommendations

In my opinion, the “next big thing” is the social media, since everyone has an e-reputation, brands and companies need to have one as well. And as I was looking for some improvement to suggest on the easyJet case, I found out they were already quite well informed on this new media. In fact, they already have a blog, a facebook fan page and a twitter account, which a re the 3 segment that are the most relevant lately to be part of.

Back in October Easyjet launched a ‘15 Hour Blogger Challenge‘ (http://blog.easyjet.com/category/15-hour-blogger-challenge/) which saw four bloggers fly to Europe with Easyjet and visit a city each (Munich, Paris, Malta and Istanbul), where they had 15 hours and a £100 to spend to explore as much of the city as they could.  The visit was recorded on video which was then used on the Easyjet blog and on YouTube, the bloggers also used Twitter as a resource to find out places to visit. 

Easyjet was able to leverage their social media presence to help deal with the crisis.

The fact that Twitter followers more than doubled from the start of December 2009 to Jan 2010 indicates that this channel is providing value for followers.

if Easyjet continues to provide value, perhaps by creating exclusive Twitter offers or promotions, it will have created a valuable and profitable marketing asset out of a bad situation. 
Every company experiences its share of customer service crises. In this case, Easyjet has demonstrated that it is possible to leverage social media services such as Twitter to help manage these crises and potentially come out in a stronger position at the end of the ordeal.


Here is an article of The Telegraph relating how important the relation between airline company and social media is :
http://www.telegraph.co.uk/technology/news/8356828/UK-airlines-nowhere-as-Facebook-and-passengers-go-social.html

The holidayPlanner allows easyJet’s Facebook fans to plan trips collaboratively with friends. Groups of three or more can suggest and vote on dates, budgets and destinations. A simple message board helps with coordination, and all actions are posted into the group’s activity feeds to syndicate and promote the experience.

EasyJet observed how successful event planning has been for Facebook members and positioned its product in line with this utility. The brand is directly using Facebook to drive sales within the channel while providing utility.

Any flight search and booking at the moment is carried out back on the main EasyJet website which users get to by following a link.

The mechanics of putting a fully functioning engine into the Facebook API may be more difficult than first appears.

Nevertheless, EasyJet’s now stated intention to take social media seriously as a booking mechanism as well as customer relationship tool is in stark contrast to bitter rival Ryanair (http://www.ryanair.com/fr). Last week the Dublin-based carrier dismissed suggestions to start engaging in social media opting instead for a section its site to allow customers to review destinations and hotels. See article below :
http://www.tnooz.com/2010/03/25/news/ryanair-we-will-not-engage-in-social-media/

Now that they have the idea (holiday planner), they should keep going on developing the concept, because it is a great idea.

Of course, they should as well make sure to be soon on the smart phone market with an application that would permit to customers to see their detailed flights information’s, booking confirmation or simply buy a flight ticket.

I would suggest to easyJet to make new type of promotion or challenge, using their facebook fan page or twitter account, to make customer feel closer to the company and build a strong e-reputation with their network on different social media.

Conclusion

The above report reflects easyJet.com’s dynamic strategy for its online business model. Through its web site, easyJet has been able to secure one of the top positions among travel related web sites.

Not only this but the structure, design, usability and usefulness of the website have enabled it to secure leverage over its competitors. More importantly, easyJet.com has incorporated flexibility in its e-business model which enables it to foresee change and develop strategies to counteract accordingly.

Otherwise, easyJet has been able to do a lot of costless e-marketing and advertising that has generate a good awareness of their website in consumer’s mind.

Consequently it has become one of the most successful web sites on the Internet.