Ryanair is an Irish low-cost airline headquartered in Dublin. Ryanair has grown so much since its establishment in 1985, from a small airline flying ashort hop from Waterford to London, into one of Europe's largest carriers.
Nowadays, Ryanair is Europe’s leading low-cost airline with 437 routes in 24 countries and an annual profit of ￡306,712,000in 2006. Its principal characteristic is the rapid expansion, a result of the deregulation of the aviation industry in Europe in 1997 and the success of its low-cost business model.
Ryanair is oneof the most successful airlines whether in terms of profits, number of flights and it is the largest company of number of passengers flown.
1. What is your assessment of Ryanair's launch strategy?Ryanair’s launch strategy is good because of these factors:
* Ryanair recognized the profitability of the Dublin-London route, which was the only route that was profitable for Aer Lingus.Ryanair saw an opportunity to rationalize its costs by specializing on this specific route.
* It targeted an already proven profitable route and it underpriced the competition by making airtravel more attractive and comfortable than other types of transportation for this route: the journey used to last nine hours by rail and ferry and one hour by air. Prices of round-trip rail-and-ferrytickets fell as low as 55 pounds but it was needed more time to arrive, so people started to buy Ryanair’s tickets that offered a low fare and a shorten travel time.
* Ryanair introduced alow cost, unrestricted fare, cheaper than British Airways and Aer Lingus, but still focusing on first rate service. This was possible because Ryanair only planned to run four roundtrips per day, usesmall aircrafts and fly to secondary airports which charged more economical fees.
* Having in mind all these characteristics we think that Ryanair had a competitive advantage due to its...