Marketing: Recommendations on

Revising Malaysia Airlines

Marketing Strategy in Improving its
Market Share
WESTMINSTER INTERNATIONAL COLLEGE, SUBANG
Lecturer :

Dr Julian Michael Berry

Tutor

Dr Vincent Wee

Group

33

August 9, 2015
Authored by: Alexis Choo

Student ID: 0131GKIGKI0415

Contents
List of Appendices .................................................................................................................................. 1
List of Tables .......................................................................................................................................... 2
Abbreviations .......................................................................................................................................... 3
Objectives ............................................................................................................................................... 4
Executive Summary ................................................................................................................................ 5
Introduction ............................................................................................................................................. 6
Situation Analysis ................................................................................................................................... 8
Customer Analysis .............................................................................................................................. 8
Competitor Analysis ........................................................................................................................... 9
Direct Competitors .......................................................................................................................... 9
Indirect Competitors ....................................................................................................................... 9
Air Traffic Statistics.......................................................................................................................... 10
Competitive Market Share Segment ................................................................................................. 10
Barksdale & Harris Combined Portfolio Model ............................................................................... 11
SWOT Analysis ................................................................................................................................ 13
Strength ......................................................................................................................................... 13
Weaknesses ................................................................................................................................... 13
Opportunities................................................................................................................................. 14
Threats........................................................................................................................................... 15
PEST Analysis .................................................................................................................................. 16
Economics ..................................................................................................................................... 16
Political ......................................................................................................................................... 16
Socio-Cultural ............................................................................................................................... 16
Technological ................................................................................................................................ 17
Legal ............................................................................................................................................. 17
Environmental ............................................................................................................................... 17
Consumer Market Segmentation........................................................................................................... 18
Consumer Market Segmentation....................................................................................................... 18
Geographic ........................................................................................................................................ 18
Demographic ..................................................................................................................................... 19
Psychographic ................................................................................................................................... 20
Behavioural ....................................................................................................................................... 20

Primary Segment Customers............................................................................................................. 21

Secondary Segment Customers ......................................................................................................... 21
Potential Customers Segment ........................................................................................................... 21
Marketing Strategies Analysis .............................................................................................................. 23
Ansoff Matrix.................................................................................................................................... 23
Marketing Strategy ........................................................................................................................... 24
Profit Projection for 3 Years ............................................................................................................. 24
Hybrid Strategy ................................................................................................................................. 26
Marketing Mix Actions ......................................................................................................................... 27
Internal Marketing ............................................................................................................................ 27
Interactive Marketing ........................................................................................................................ 27
External Marketing (7Ps)................................................................................................................. 28
Place .............................................................................................................................................. 28
Product .......................................................................................................................................... 28
Price .............................................................................................................................................. 28
Promotion...................................................................................................................................... 29
People............................................................................................................................................ 29
Process .......................................................................................................................................... 29
Physical Evidence ......................................................................................................................... 29
Recommendations for Total Customer Experience (TCE) ................................................................... 30
References ............................................................................................................................................. 33

List of Appendices
Appendix 1 Last Quarter Financial Losses MAS for 2013 and 2014........................................................ 7
Appendix 2 What are the most important factors when purchasing airline tickets? Source: Elliot &
Consumer Traveler .................................................................................................................................. 8
Appendix 3 Source: Market Realist ...................................................................................................... 10
Appendix 4 Source: CAPA, 2014 ......................................................................................................... 10
Appendix 5 CPM of MAB and Competitors ........................................................................................... 11
Appendix 6 MAS Profitability Ratios of 10 years Source: MorningStar, 2014 ................................... 14
Appendix 7 Source: Thomson Reuters ................................................................................................. 15
Appendix 8 Aviation Jet Fuel Price as of 21 Aug 2015. Source: IATA, 2015 ..................................... 16
Appendix 9 Consumer Market Segmentation for MAB ....................................................................... 18
Appendix 10 SocialBakers Analysis on MAB's Facebook Likes. Source:SocialBakers ...................... 19
Appendix 11 Forecast on Generation Spendings on Business Flights Source:Cederholm ................... 20
Appendix 12 Generation X Highest Internet Usage Source: Pew Research ......................................... 22
Appendix 13 MAB Facebook Page Source: Facebook ........................................................................... 31
Appendix 14 MAB #StayStrong Campagin ............................................................................................ 32

List of Tables
Table 1 Ansoff Matrix ............................................................................................................. 23
Table 2 3 Years Planning for MAB ......................................................................................... 25
Table 3 3 Years Income Statement for MAB .......................................................................... 26
Table 4 3 Years Projection of Balance Sheet of MAB ............................................................ 26

Abbreviations
MAS

Malaysian Airline System

MAL

Malayan Airways Limited

MAB

Malaysia Airlines Bhd

LCC

Low Cost Carriers

IATA

International Air Transport Association

CAPA

Centre for Aviation

BCG

Bostron Consulting Group

PLC

Product Life Cycle

FY

Financial Year

SIA

Singapore Airlines

VoIP

Voice over Internet Protocol

BAC

Brahims Airlines Catering Sdn Bhd

Nufam

National Union of Flight Attendants

AVOD

Audio Video on Demand

GST

Government Service Tax

RM

Ringgit Malaysia

USD

United States Dollar

FFP

Frequent Flyer Program

WIIFM

Whats In It For Me

CRM

Customer Relationship Management

WOM

Word of Mouth

APEX

Advance Purchase Excursion Fare

MH

Malaysian Hospitality

CPM

Combined Portfolio Model

RMB

Chinese Yuan (Ren Ming Bi)

F2F

Face-to-face

SLA

Service Level-Agreement

TCE

Total Customer Experience

CEC

Customer Experience Culture

Objectives
This paper aims at achieving the following objectives:

Critically evaluate the airline industry market attractiveness and potential in managing
risk among competitors

Evaluate on market segmentations and consideration of new market segmentation

Recommend a marketing strategy with future financial projections of 3 years

according to Ansoff Matrix Framework

Critically analyse marketing mix action in order to achieve broad based marketing
strategies as proposed in Ansoff Matrix Framework

Discussion on customer total experience being with MAB

Executive Summary
This written report examines the performances of MAB in its competition environment as
against those Malaysia-based competitors. Besides that, the report dictates on
recommendations on improving the companys marketing strategies and on how to improve
customers total experience with the company.

The introduction section of the report gives a brief summary of MAB and the industry review.
It also explains on the competitive environment MAB is involved in, comparing its SWOT,
PESTEL and PLC/BCG model to understand better of the services offered by MAB. It also
studies on its competitors, acknowledging and learn the responsive and positive returns of
their marketing strategies.

In the research and analysis process, critical evaluations are done in order to determine a
better marketing strategy for MAB. By using the evaluation results, conclusions may be
derived to improve customers total experience with MAB.

Introduction

The aircraft industry in most of the world, including Malaysia is said to be of oligopoly
structure. Oligopoly simply means having few competitors providing the same sort of product
or services (Nagurney & Li, 2014). In addition, oligopolistic companies emphasizes on their
marketing campaigns in order to gain better market share and the competitors are all
interdependent and decisions made will affect all players (Varun, 2011). However, the
aviation industry has changed in recent years as new competitors especially low-cost carrier
like AirAsia, MalindoAir have entered into the picture. The main reason that LCC are
attracting customers is their complex fare structure via cost reduction and productivity
increase (Chowdhury, 2007).
MAS have come a long way since 1937 when it was founded as MAL. The company first
flew their commercial flight on 1947 and since then grows into an international carrier within
decade. The growth of the company never stop as it progressed with up to 850 domestic and
international flights; finally settled down with the name, Malaysia Airlines as it took its
course on 1st October 1972. Besides this, MAS owns subsidiary Firefly, MASwings and
MASkargo where FireFly operates on home base flights between Subang and Penang where
as MASwings focusing on inter-Borneo fights while MASKargo manages freighter flights.
MAS was all along a government-owned carrier until it became private in 2014, making a
complete overhaul after suffering two tragic aircraft disaster which gives the company a new
name, MAB (Business Insider, 2014).
MAB has earned itself more than 100 recognitions and one of the remarkable ones is Worlds
Best Cabin Crew for few consecutive years. The aviation industry still sees growth as new
low-cost carrier joins in the battle with MAB staying competitive. However, MAB has been
making losses over the years as shown in Appendix 1.

Appendix 1 Last Quarter Financial Losses MAS for 2013 and 2014

The losses are further increased as MAB was hit by both MH370 and MH17 tragedy, losing
customer trust and business opportunities; impacting its market share locally and
internationally thus it is vital to review its marketing strategies.

Situation Analysis
Customer Analysis
According to a survey done by Elliot and Consumer Traveler, cheaper air fare tops the chart,
followed by Schedule and non-stop against connecting flight. Customers care less about
business class availability and reputation of the airline service as shown in Appendix 2 (Elliot,
2011). This could further explain as customers prefer LCC due to price factors and LCCs
usually provide direct flights whereas MAB as a 5-star carrier would emphasize on its service
quality. However, quality services come with greater cost which sets a setback on customers.

Appendix 2 What are the most important factors when purchasing airline tickets? Source: Elliot & Consumer Traveler

Competitor Analysis
Direct Competitors

MAB has competitors in Asia like Cathay Pacific, Garuda Indonesia, Singapore Airlines and
LCCs like AirAsia and MalindoAir. The emergence of LCCs in Asia has troubled MAB and
other full-service airlines yield as LCCs being more popular choice for customers (Grant,
2014). MAB was reviewed to be more unproductive as its workforce of 19500 staff is 30%
than its main competitors and its revenue per employee is only 51%, comparing to Cathay
Pacific and 38% of Singapore Airlines (Meager, 2014). This may be one of the reasons MAB
has been making losses.

Indirect Competitors

MABs indirect competitors would be ferry cruises for long distance or oversea travels while
inland travels would be buses, trains and land vehicles. It is vital to consider the competitions
against indirect competitors because customers are open to other options if they are
uncomfortable in flying with MAB, especially after both air crash tragedy which impacted
MABs earnings as reported (AFP, 2014).

Air Traffic Statistics

According to IATAs press release, there was an increased demand of 5.9% in 2014
compared to 2013. 2014s aviation industry performance was stronger than average by 5.6%
which sees the room for growth, pin-pointing on Asia-Pacific and Middle East (IATA, 2015)
as depicted under the bar chart below. It is evident to say that there are potential customers
and opportunities in the Asia Pacific and Middle East market; pending to be explored.

Appendix 3 Source: Market Realist

Competitive Market Share Segment

According to CAPAs study which is shown in the pie chart below, Air Asia tops all aviation
companies in the local market, holding 32.8% of the market shares while MAB is placed
second with 30.2%. MABs subsidiary, Firefly holds 3.5% which is quite reasonable since it
is considered as small scale airline as compared to others (CAPA, 2014).

Appendix 4 Source: CAPA, 2014

Barksdale & Harris Combined Portfolio Model

Both BCG Matrix Model and PLC are commonly used to analyze companys products but in
this case, Barksdale & Harris combined both into CPM in understanding where MAB stands
in the market and what are the actions needed to improve their market share or rather, grow
another market.

Appendix 5 CPM of MAB and Competitors

Based on the CPM above, MAB is said to be at a decline stage as it has been making
substantial losses over the years due to management inefficiency (Singh, 2014) Despite so,
MAB has yet to reach the Dodo stage as MAB still generates revenue and is the preferred
airplane company especially for routes to London, Frankfurt and Los Angeles. However,
effective strategy like introducing new products or services has to be developed to overturn
this and make MAB a Cash Cow.
MABs competitor, AirAsia who currently tops the market is still at its growth and can be
considered as a Cash Cow. However, for the first half year of 2015, AirAsia X which is the
long-haul flight is making losses (CAPA, 2015). It may be possible for AirAsia to be moving
toward late maturity stage as the companys growth is slowing down.

On the other hand, Cathay Pacific had reported a positive performance in 2014, an increase of
63.6% in its dividends per share growth whilst SIA on the other hand reported a slightly
decrease in its profit for FY2014.

From the PLC/BCG Model, it is observed that aviation companies are interdependent to each
other and recommendations and strategies should be introduced in order to prevent their
companies from turning to dodos.

SWOT Analysis
Strength

Cabin Crews

MAS has won numerous awards for having excellent cabin crew services where crews are
heavily trained to serve and promote the airline. This is part of MASs branding strategy
where slogan like MH is Malaysia Hospitality was used to highlight on the hospitality of
employees.

International fleets

MAS has earned great impression of being the top international flight carriers. Long haul
flights like Boeing 747 and 777 are well equipped with AVOD which clearly triumphs over
competitors like AirAsia. The excellence in servicing customers for economy and premium
class had won numerous awards.
Weaknesses

Poor Financial Health

MAS has been making losses ever since 2011 as shown in Appendix 6. The Operating
Margin, EBIT Margin and importantly, ROI are showing negative values which means the
company is making losses while competitors like SIA and Cathay are earning positively. The
losses are partly due to increased competition. Nonetheless, long haul airways are affected
too and the two air crash tragedy of MH370 and MH17 further worsen the financial losses.

Appendix 6 MAS Profitability Ratios of 10 years Source: MorningStar, 2014

Poor Management

Many analysts reported on poor management that had caused the financial losses. Nasaruddin,
president of Nufam mentioned that the problem lies within the management team instead of
internal staffs (The Rakyat Post, 2015). Tan Sri Tony Fernandes on the other hand slams on
the MAS management for its poor management in delaying the KLIA2 Terminals and
financial losses which then impacted customers to paying higher taxes (Kamal, 2014). In
order to turnover, MAB made plans on cutting costs and selling off fleets; estimating
breakeven by 2016.

Opportunities

Firefly

MAS launched its own LCC, Firefly, which flies domestically and neighbouring country like
Singapore, Indonesia and Thailand. Firefly has helped gain revenue and competes against
LCC competitors. Firefly earned the opportunity of being the sole airline connecting Penang
with Thailands Phuket and Koh Samui. The operations of Firefly may be ported into MAB if
its found profitable and workable in competing against LCCs.

Newer Fleets

MAB management team has plans on removing old fleets and acquiring better technology and fuel
efficient aircrafts to achieve cost saving and making it align to competitors. New technology planes
provide better in-flight experiences and strengthen customers confidence towards MAB.
Threats

Economic changes

Malaysia economy is undergoing downslope as RM dropped while oil price gone drain low
along with unstable political conditions. RM slammed nearly 17% as shown in Appendix 7
and such negativity caused foreign investors to withdraw from investing in the country
(Economist, 2015).

Appendix 7 Source: Thomson Reuters

Competitors

AirAsia as the biggest LCC competitor, MalindoAir joining in the game and other foreign
companies like SIA and Cathay are competing hard in the Asia region because LCCss low
prices pressure. MAB has to differentiate its product and services in order to gain market
interest and sustain its customers from switching to competitors product.

PEST Analysis
Economics

Asia region as stated has tremendous opportunity and growing demands. Sales revenue varies
depending on factors including high operation and maintenance costs, global recessions,
intense competition and the fluctuation of fuel prices where Appendix 8 shows the latest jet
fuel price. Besides this, the fluctuation of currency, strengthen of USD and RMB devaluation
impacts the whole economy.

Appendix 8 Aviation Jet Fuel Price as of 21 Aug 2015. Source: IATA, 2015

Political

MAS has strong support by the government before privatizing. This has no doubt helped
MAS on being stronger against competitors and pertain its seat in top market share. However,
the political situation in Malaysia is rather unstable as BERSIH demonstrations took place in
protesting for few agendas which attracted worldwide attention (Economist, 2015). Besides
this, the government had imposed GST which implies to both citizen and tourist that spends
in the country.

Socio-Cultural

Social-cultural has impacts over airline sales as well where traveling demands increase
especially during festive seasons. In the Asia-Pacific regions, Philippines, China, Thailand,
Malaysia and neighbouring countries has fairly high number of public holidays. These

seasons are analyzed and promotion packages may be introduced to influence passengers in
choosing MAB.

Technological

Technology has been improving on aircrafts manufacturing as well as services provided in

and out the aircrafts; to offer better flying experience. For example, most of the airline
companies implemented online check-in. In the airplane, customers have access to Wi-Fi,
power outlets, USB ports and most basic, AVOD entertainments for passengers (Shu, 2014).
MAB has given AVOD.

Legal

A countrys legal and regulations affects the aviation industry in order to make peace and
protect both airline companies and passengers benefit. Globally, competition law has been
applied in the airline industry to address to code sharing, price fixing, corporate discounts and
many other modules where airline companies would need to seek authorization from the
committee before publicizing (Lee, 2011).

Environmental

Environmental plays a role in aviation industry as well. Different geographical locations,

climates and weathers may impact an aviation companys flight schedule, cargo arrangements
which then impact the operations and sales. For example, Typhoon Soudelor that slammed
Taiwan traps airline passengers in the airports, delaying all scheduled flights which could
cost a bundle to the airline companies (SputnikNews, 2015).

Consumer Market Segmentation

MAB is going to start fresh and thus it is vital for the company to review on their customer
segmentations. With market segmentation analysis, MAB may design strategic decisions to
market their services (Optimove, 2015). Appendix 9 shows the segmentation for MABs
customers. Analysis are based on reasonable presumption along with social media studies by
companies like SocialBakers and We Are Social.

Consumer Market Segmentation

Geographic

Demographic

Psychographic

Behavioral

Countries
Region

Family Size
Age
Income

Traveler/Business
Social Class

Loyalty
Benefits
Service

Appendix 9 Consumer Market Segmentation for MAB

Geographic
Based on SocialBakers study of MAB Facebook likes, MAB has accumulated 1653903 likes
which can be breakdown to different countries as shown in Appendix 10. United States has
the most likes while Malaysia is placed 13th. Amongst the top 10 countries that followed
MAB, mostly are Asian countries where the growing market is. This proves that MAB is on
the right track and may use the social media marketing strategies to attract customers.

Appendix 10 SocialBakers Analysis on MAB's Facebook Likes. Source:SocialBakers

Demographic
Generally, populations are categorized into few which are baby boomers, Generation X, Y
and Z. Cederholm mentioned that baby boomers are the main spenders in traveling yet the
Generation X will be overtaking baby boomers in 10 years time (Cederholm, 2014). This
could mean that the primary customers are of age 40s to 70s while secondary customers are
the Generation X whom are at their early 25s to 40s. Based on the age gaps, it can be
presumed that the passengers travel either for business or in families with minimum middleclass income. Appendix 11 shows the forecast of different generations spending on air tickets.

Appendix 11 Forecast on Generation Spendings on Business Flights Source:Cederholm

Psychographic
There are reasons on passengers taking flights and generally it can be categorized to traveling,
business trips and visitations. Kirby further confirms that the demand across airline industry
is absolutely positive for both business and leisure traveling (Boehmer, 2014). On the other
hand, as mentioned earlier in demographics, the future major customers would be Generation
Y with the least of middle-class in terms of the social status.

Behavioural
It is challenging for airlines to understand all customers expectation which motivates airlines
to improve their services and strategies to attract passengers (Boksberger, 2011). Generally,
the customers may be categorized to few behaviors which are loyalty, benefits-centric and
service-oriented. Loyal customers would choose MAB regardless of benefits provided while
benefits-centric customers look forward to loyalty programs like FFP. Service-oriented
customers expect excellent service by cabin crew.

Primary Segment Customers

Based on the segmentations presented earlier, we can conclude that primary customers have
the following characteristics.

Asia Countries

Family travelling in groups

Baby boomers & Generation X

Middle Class and above

Benefit-oriented

Secondary Segment Customers

Secondary segment customers have the potential in becoming primary if requirements are
met. The characteristics are shown below.

Countries out of Asia

Below well-being family and Individuals

Generation Y

Below Middle class

Slacker group where customers do not concern about any of the benefits, services or
being loyal.

Potential Customers Segment

Asia countries

Family Group of at least 2

Generation X

Middle and above class

Benefit & service oriented

The Generation X will be the future important customers. Therefore, the marketing
strategies should focus on the expectation of this group. To reach out to these customers,
benefits and services programs through digital marketing are the best-sought strategies as

Generation X has the WIIFM attitudes and Generation X has the arguably best education as
mostly gained the least of Bachelors Degree or higher (Schroer, n.d). In addition, digital
marketing will grow the targeted customer segments because the potential market, AsiaPacific has 1.4Million users (We Are Social, 2015) and still growing. Research also shows
that majority digital media demographics are Generation X (PewInternet, 2014).

Appendix 12 Generation X Highest Internet Usage Source: Pew Research

In terms of value proposition, MAB may market its 5 star service and benefit-filled flying
experience towards customers, proposing to them Serving you and your loved ones with the
best hospitality. With effective marketing strategies, MAB may expect profit as RyanAir
reported an increase of 32% after adapting digital marketing strategies (Lauchlan, 2014).

Marketing Strategies Analysis

Ansoff Matrix
Ansoff Matrix focuses on existing and potential product and market where MAB may
determine the suitable growth strategy in order to market to the potential customers. Also,
Ansoff Matrix helps to understand the risk of the strategies the company opted for
(Manktelow, n.d).

Present

Present

New

Market Penetration

Product Development

Market Development

Diversification

Market
New

Table 1 Ansoff Matrix

Based on the Ansoff Matrix, different quadrant uses different strategies and absorbs different
risks. For MAB, the advisable would be Market Penetration as MAB has already
established its services in many regions, including the potential Asia region. In view of
MABs overall financial status, MAB should focus on increasing sales for existing product in
its existing market. In short, it is advisable for MAB to increase the frequency of flight in
Asia countries, providing passengers the renowned 5-star services.
However, there are risks associated which is discussed below.
Market Place becomes saturated
There is a risk where stagnant customer satisfaction stops the market growth. It can be
resolved by improving and aggressive marketing strategies frequently (Kokemuller, n.d).
Deviated Opportunities
MABs 5-star services requires high production cost in terms of trainings given thus can be
considered as luxury service yet market penetration with lower price may devalue it and
making it cheap, causing MAB missing the opportunity. However, this risk may be
diversified or managed promptly if the services are customized according to different price

grades of flights offered. For example, business class may be further customized and charged
differently, providing options to customers.

Marketing Strategy
While managing risks that may occur, MAB may find itself competing in the most profitable
region and gain more market shares with customized services and products. Therefore, the
most appropriate marketing strategy would be digital marketing, starting off with
rebranding. This is because both MH incidents have completely tarnished MASs brand.
Fortunately, the management has already worked on rebranding and reorganization.
Nonetheless, MAB logo should be changed as well.

Profit Projection for 3 Years

With this 3 years plan, MAB hopes to breakeven from losses and start gaining profit. These
plans will help strengthen MAB and customers ties.
Year

Milestone
Rebranding
Organization Restructure

Cost Cutting
1

Marketing

Description
Renaming of MAS to MAB.
New logo.
Cut workforce by 6000 to achieve optimum
workforce capital.
New Business model.
New Marketing strategy.
Improve crisis management team.
Improve Customer Service team.
Sell off/lease old fleets
Purchase newer fleets with better technology
Cut off non-profit making routes.
Budget airline meal.
Improve business operations, making air fare
purchasing, boarding and other services easier.
Establish social media team.
Launch marketing campaign using digital
marketing strategies which includes promotion,
competitions and loyalty programs
Reputation management
Engagement with communities
Engage communication networks with all parties
Engagement with partnership alliances like travel

Management

Integrated Marketing

Management

Integrated Marketing

agency, code share airline companies and loyalty

programs
Provide training to upskill employees
Revise and review possible profitable flight route
Improve quality control supervision
Raise brand awareness
Improve social responsibilities
Maintain 5-star service quality
Increase Brand Awareness
Improve Website traffic by encouraging air ticket
purchased online
Engage promotion via MAB website
Live Chat Support via MAB website
Measure mentions and events on social media
Improve engagement with communities
Improve communication networks with all parties
Improve relationship with partnership alliances
like travel agency, code share airline companies
and loyalty programs
Review employees KPIs
Reward employees; make them have sense of
belonging with the company.
Hire potential employees to further grow MAB.
Improve financial health via better financial
control. For example: lower operation cost,
improved margin ratios.
Improve social responsibilities
Improve 5-star service quality and fleet operations
and maintenances.
Consider expanding operations to other potential
regions.
Expand marketing scope wider to other regions.
Continuously improve social media traffic of
MAB.
Aggressive advertising for regions with slower
growth.
Introduce new products and services.

Table 2 3 Years Planning for MAB

The figure below shows the 3 year projected income statement of MAB which expects to
breakeven by 2016, since MABs operation on 2015.

Table 3 3 Years Income Statement for MAB

Table 4 3 Years Projection of Balance Sheet of MAB

Hybrid Strategy
As risks have been measured, hybrid strategies would be suitable for MAB. This is because
some of the markets have more business travelers while some may have more leisure
travelers. MAB should be more flexible and find suit to market needs. Thus, customer
demands are heard and will be customized to meet their requirements. This is considerably a
better approach to meet different markets needs, instead of using one focused strategy (Lin
Say, 2015).

Marketing Mix Actions

Different marketing tools are used to perform situational analysis to understand the
companys present situation and determine its future path. Marketing 7Ps may be used to
achieve the marketing objectives.

Internal Marketing
Marketing has to be done internally in the company as well. This is because the employees
are also an asset of the company and they represent the brand as well. As McDuffie quoted,
employees are entrusted to be the voice of the companies brand; employees will be more
invested in the missions and visions of the company (McDuffie, 2015). Fogel on the other
hand emphasizes that internal marketing ensures employees effectively carries out the
companys products and services (Fogel, 2012). For MAB, marketing must be done internally
from top to bottom hierarchy as well by offering benefits like cheaper air fares, enhanced
loyalty programs and special employees welfare to employees and their close families,
similarly done by Disney in a program called Disney Difference.

Interactive Marketing
Approach audiences via digital marketing which is growing means opportunities in capturing
new and retaining old customers. The proposed plan for MAB is to advertise in Google
Adwords, social media like Facebook, Twitter, Instagram, and investing in mobile
application. Google Adwords helps advertise MAB regionally, reaches customers at a clickaway which demonstrates one of the 4Ps Place, being at the right place, the right time.

Besides that, social media like Facebook has growing importance whereby it allows
companies to learn about their audiences through Facebook Insights, allowing companies to
target their audience effectively (Cisnero, 2014). MAB may utilize social media to
communicate, understand and listen to customers. This represents part of CRM and it is
crucial to manage accordingly. MAB may organize events and competitions on social media
to attract customers to participate. For example, snap a picture of you on MAS and reasons
you like about MAB and hashtag #MABRocks. These will in turn becomes WOM which is
more valuable than adverts done by marketing team.

The mobile application may improve operations like web-check in, booking flights and
attending customer queries. With LiveChat, customers may reach MAB anytime which
improves customer satisfactory (Freedman, 2014).

External Marketing (7Ps)

Integrated marketing shall be adopted to amaze customers, giving them the brand experience
of being with MAB where MAB should focus on 3 of the 7Ps highly for better system
delivery - People, Process and Physical Evidence.

Place

MAB should provide 24/7 services to customers so that they may contact with the company,
be it flight bookings or queries. Besides this, stretching MABs services via affiliations with
travel agents, code share companies, hotels and other parties may also help in marketing
MABs products and services, allowing MAB accessible at different regions.

Product

Customers would demand for better service, from cabin services to catering and on-ground
services, the quality of services given must be distinguished where MAB has achieved
throughout the years. This is one way to distinct MAB from its competitors. It may be
improved by offering more luggage capacities, better insurance and quality cabin foods.

Price

MABs LCC, Firefyl may implement better promotions on Low-Cost Pricing while MAB on
may also implement such promotion yet at a full-fledged airline companys price range.
Certain routes may be APEX fares or value for money policy, depending on the routes
operation cost and passengers capacity.

Promotion

The elements of the advertisement may include tourism attractions, 5-star services provided
plus sales and promotions to attract public interest. MAB may also held contests with
attractive prizes where customers may participate. Other than MAB itself, extended parties
like travel agents, media and even customers may also play a part in promotion mix, for
instance, spreading WOM.

People

CRM is important for airlines which MAB should provide proper training for its employees
especially those whom are in direct contact with customers. This is to ensure employees are
knowledgeable and well-equipped; able to help customers and attend to queries constantly.
As customer experience is important, providing 5-star services would create new and retain
existing customers from switching to competitors airline. Furthermore, customers may spread
WOM and win referrals.

Process

Good process like shortening excessive booking steps and faster check-in process would
assure customers satisfactions. If quality process from flight booking, on-ground services, in
and off-flight services are being provided at all times, rest assured that customers would stay
loyal to MAB.

Physical Evidence

MAB should always ensure cleanliness, safety and accessibility are provided and upkeep at
all times. This is because the whole flying experience represents MAB brand and being
professional would ensure customer satisfactory.
As MAB practices the 7Ps, it is already positioning itself as the The Best Flying Experience
due to the proposition of being the best cabin service in the region.

Recommendations for Total Customer Experience (TCE)

Bankruptcy and MH incidents had tarnished the brand thus MAB has begun its journey of
rebranding. However, more can be done to improve customer experience via social media
which increases customer loyalty and satisfactions (Beule, 2015).

There are several touchpoints between MAB and customers as listed below.

Website, Mobile Application, Social sites

Call Center

Check-in

Crisis Management

Post-flight

TCE may be created by integrating MAB values into social media sites and aids in building
the brand. MAB has 5-star cabin crew in flight while listening, giving feedbacks and
resolving customers issues via social media as shown in Appendix 13, would add value to it
(Beule, 2015), creating service differentiation from competitors.

Appendix 13 MAB Facebook Page Source: Facebook

Besides that, solidarity with customers at difficult times creates personal touch and
exceptional TCE. MAB launched #staystrong campaign as shown in Appendix 14, had
received huge buzz where internet users replied in giving support and understanding (tvn24,
2014). Importantly, during BAU, shortening waiting time during check-in and gathering
feedback from customers post-flight demonstrates MABs professionalism and concern over
customers flying experience and overall satisfactions.

Appendix 14 MAB #StayStrong Campagin

Set aside social media, physically, MAB should create CEC which endorses TCE eventually.
Morgan quoted that employees should first be treated specially like incentivize contact center
agents who performed well in serving customers, train and emphasize cabin crews on safety
and services and making leadership visible throughout the organization (Morgan, 2015). This
is because employees are the voice of the brand and only with happy employees may the
company improve its customers TCE, making a difference against its competitors.

References
AFP. 2014. Malaysia Airlines' Financial Losses Have Nearly Doubled Since Flight MH370
Disappeared. [ONLINE] Available at: http://www.businessinsider.com/afp-malaysiaairlines-loss-nearly-doubles-on-mh370-impact-2014-8?IR=T&. [Accessed 20 August 15].
Anindya Upadhyay. 2013. AirAsia's Tony Fernandes to rely on Kathleen Tan to pilot India
take off. [ONLINE] Available at: http://articles.economictimes.indiatimes.com/2013-0416/news/38586394_1_airasia-india-tony-fernandes-spicejet-and-jet-airways. [Accessed 20
August 15].
Available at: http://www.ft.com/cms/s/0/4c7ac1d6-a692-11e3-aeff00144feab7de.html#axzz3jYeFwdJS [Accessed 22 August 2015].
Available at: http://www.news.com.au/finance/work/who-is-tony-fernandes-the-airasiaboss/story-fn5tas5k-1227171009497 [Accessed 22 August 2015].
Available at: http://www.therakyatpost.com/news/2015/03/21/mas-problems-due-to-badmanagement-not-staff-says-nufam-president/ [Accessed 30 August 2015].
Blake Morgan. 2015. 5 Ways Company Culture Can Improve Your Customer Experience.
[ONLINE] Available at: http://www.forbes.com/sites/blakemorgan/2015/02/02/5-wayscompany-culture-can-improve-your-customer-experience/2/. [Accessed 01 September 15].
Boksberger, Philipp, 2011. Aviation Systems. 1st ed. Switzerland: Springer Berlin Heidelberg.
Business Insider, 2014. Business Insider. [Online]
Business Insider, 2014. Business Insider. [Online]
Available at: http://www.businessinsider.com/malaysia-airlines-overhaul-2014-8?IR=T&
[Accessed 22 August 2015].
Carol Luther. 2015. Who Can Travel in Business Class?. [ONLINE] Available
at:http://traveltips.usatoday.com/can-travel-business-class-13349.html. [Accessed 28 August
15].
Chuck Freedman. 2014. Customer Satisfaction of Airlines Taking Off with Mobile and APIs.
[ONLINE] Available at: http://www.mashery.com/blog/customer-satisfaction-airlines-takingmobile-and-apis. [Accessed 19 August 15].
David Flynn. 2014. Malaysia Airlines eyes Airbus A350, Boeing 787 but unsure of 777X.
[ONLINE] Available at: http://www.ausbt.com.au/malaysia-airlines-eyes-airbus-a350boeing-787-but-unsure-of-777x. [Accessed 01 September 15].
Elaine Forgel. 2012. Totally Uncorked on Marketing. [ONLINE] Available
at:http://elainefogel.net/2012/05/15/the-importance-of-internal-marketing/. [Accessed 19
August 15].
Erfan Chowdhurry. 2007. Low Cost Carriers: How Are They Changing the Market Dynamics
of the U.S. Airline Industry? . [ONLINE] Available at: http://carleton.ca/economics/wpcontent/uploads/he-chowdhury-erfan.pdf. [Accessed 22 August 15].

Gina McDuffie. 2015. Why Internal Marketing Could Be The Most Important Marketing.
[ONLINE] Available at: http://www.cmo.com/articles/2015/4/27/why-internal-marketingcould-be-the-most-important-marketing.html. [Accessed 20 August 15].
Grant, J., 2014. Financial Times. [Online]
Available at: http://www.ft.com/cms/s/0/4c7ac1d6-a692-11e3-aeff00144feab7de.html#axzz3jYeFwdJS
[Accessed 22 August 2015].
IATA. 2015. Strong Demand for Air Travel Rises in 2014. [ONLINE] Available
at:http://www.iata.org/pressroom/pr/Pages/2015-02-05-01.aspx. [Accessed 19 August 15].
James Manktelow. 2006. The Ansoff Matrix - Understanding the risks of different options.
[ONLINE] Available at: http://www.timeanalyzer.com/lib/ansoff.htm. [Accessed 28 August
15].
Jay Boehmer. 2014. 2014 Business Travel Survey: U.S. Airlines Flying High With Profits.
[ONLINE] Available at: http://www.businesstravelnews.com/More-News/2014-BusinessTravel-Survey--U-S--Airlines-Flying-High-With-Profits/?ida=Airlines&a=btn. [Accessed 28
August 15].
Kraig Becker. 2014. 10 Reasons Why Flying is Still the Best Way to Travel. [ONLINE]
Available at:http://www.flightnetwork.com/blog/10-reasons-flying-still-best-way-travel/.
[Accessed 01 September 15].
Kristina Cisnero. 2014. 10 Benefits of Social Media for Business Every Skeptic Should Know.
[ONLINE] Available at: http://blog.hootsuite.com/social-media-for-business/. [Accessed 20
August 15].
Kuok Yew Chen. 2011. OUR STORY Commitment to excellence remains at the heart of who
we are.. [ONLINE] Available at: http://www.christopherleeco.com/wp3/?p=779. [Accessed
19 August 15].
Lee Shu. 2014. From mile-high Wi-Fi to mobile boarding passes, which airline has the best
tech? Read more: http://www.digitaltrends.com/cool-tech/airline-tech-savvy/#ixzz3l4cUNqsr
Follow us: @digitaltrends on Twitter | digitaltrendsftw on Facebook. [ONLINE] Available
at: http://www.digitaltrends.com/cool-tech/airline-tech-savvy/. [Accessed 20 August 15].
Lizzie Meager. 2014. Market conditions threaten Malaysia Airlines' survival. [ONLINE]
Available at: http://www.worldfinance.com/home/market-conditions-threaten-malaysiaairlines-survival. [Accessed 22 August 15].
MAB, Annual report 2013, Malaysia Airlines Bhd, Malaysia
MAH, Annual report 2013, Malaysia Airports Holdings Bhd, Malaysia
Malaysia Airlines. 2015. OUR STORY Commitment to excellence remains at the heart of who
we are.. [ONLINE] Available at: http://www.malaysiaairlines.com/my/en/corporateinfo/our_story/about-us.html. [Accessed 01 September 15].

Martin. 2014. Marketing 101 7Ps of Marketing | Additional Elements of Marketing mix.
[ONLINE] Available at: http://www.entrepreneurial-insights.com/7ps-additional-aspectsmarketing-mix/. [Accessed 02 September 15].
NAGURNEY, A. and LI, D., 2014. A Dynamic Network Oligopoly Model with
Transportation Costs, Product Differentiation, and Quality Competition. Computational
Economics, 44(2), pp. 201-229. [Accessed 31 August 2015].
Neil Kokemuller. n.d. Market Development vs Market Penetration. [ONLINE] Available
at:http://smallbusiness.chron.com/market-development-vs-market-penetration-66561.html.
[Accessed 20 August 15].
News.com.au, 2014. News.com.au. [Online]
Optimove. 2015. Customer Segmentation. [ONLINE] Available
at: http://www.optimove.com/learning-center/customer-segmentation. [Accessed 28 August
15].
PewInternet. 2014. Internet User Demographics. [ONLINE] Available
at: http://www.pewinternet.org/data-trend/internet-use/latest-stats/. [Accessed 22 August 15].
Rajvinder Singth. 2014. Should the top MAS Management Stay or Go: MAS Top
Management Should Go. [ONLINE] Available
at: http://www.therakyatpost.com/allsides/2014/09/25/mas-top-management-go/. [Accessed
20 August 15].
Shazwan Mustafa Kamal. 2014. Tony praises AirAsia, slams MAS, MAHB over flag carriers
RM1.17b loss. [ONLINE] Available
at: http://www.themalaymailonline.com/money/article/tony-praises-airasia-slams-mas-mahbover-flag-carriers-rm1.17b-loss. [Accessed 01 September 15].
Simon Swan. 2015. How to create a digital marketing plan using PR Smith's SOSTAC
Planning model. [ONLINE] Available at: http://www.smartinsights.com/digital-marketingstrategy/sostac-plan-example/. [Accessed 22 August 15].
Siva Govindasamy, Trinna Leong. 2015. Malaysia Airlines upgrades aircraft tracking, a year
after MH370. [ONLINE] Available at: http://www.reuters.com/article/2015/03/06/usmalaysia-airlines-minister-idUSKBN0M20X520150306. [Accessed 20 August 15].
Sputnik News. 2015. Typhoon Soudelor caused massive air traffic disruptions on Saturday in
Taiwan, with 279 domestic flights and 37 international flights being canceled.. [ONLINE]
Available at:http://sputniknews.com/asia/20150808/1025524667.html. [Accessed 28 August
15].
Sross, Paul, 2015. Building Brand Value and Influence in the Airline Industry. The Yellow
Paper Series, [Online]. 1, 3. Available
at: http://www.paulsross.com/assets/DDB_YP_AirlineBranding.pdf [Accessed 01September
2015].
Stuart Lauchlan. 2014. Ryanair CEO concedes being nice to customers does work as profits
soar. [ONLINE] Available at: http://diginomica.com/2014/11/04/ryanair-ceo-concedes-nicecustomers-works-profits-soar/#.Vehlqvaqqkp. [Accessed 20 August 15].

Tee Lin Say. 2015. New Malaysia Airlines to adopt hybrid model, says CEO. [ONLINE]
Available at:http://www.thestar.com.my/Business/Business-News/2015/06/10/New-MAS-toadopt-hybrid-model-says-CEO/?style=biz. [Accessed 28 August 15].
Teresa Cederholm. 2014. Why social and demographic factors influence air travel demand.
[ONLINE] Available at: http://marketrealist.com/2014/09/why-social-and-demographicfactors-influence-air-travel-demand/. [Accessed 28 August 15].
The Economist. 2015. Malaysia in graphics Economic Malays. [ONLINE] Available
at:http://www.economist.com/blogs/graphicdetail/2015/08/malaysia-graphics. [Accessed 19
August 15].
The Marketing mix. 2015. The Marketing Mix 4Ps and 7Ps Explained. [ONLINE]
Available at:http://marketingmix.co.uk/. [Accessed 02 September 15].
The Rakyat Post, 2015. The Rakyat Post. [Online]
Available at: http://www.therakyatpost.com/news/2015/03/21/mas-problems-due-to-badmanagement-not-staff-says-nufam-president/
[Accessed 31 August 2015].
tvn24. 2014. Malaysia Airlines call: #STAYSTRONG. [ONLINE] Available
at:http://www.tvn24.pl/wiadomosci-ze-swiata,2/malaysia-airlines-apelujastaystrong,453233.html. [Accessed 01 September 15].
Varun. 2011. 6 essential characteristic features of oligopolistic market. [ONLINE] Available
at: http://www.preservearticles.com/201106178093/6-essential-characteristic-features-ofoligopolistic-market.html. [Accessed 22 August 15].
William J. Schroer. n.d.. The Social LIbrarian. [ONLINE] Available
at:http://www.socialmarketing.org/newsletter/features/generation3.htm. [Accessed 24 August
15].