What is E commerce

As the number of Internet users has increased, so has the variety of websites. Websites nowadays
include various types, such as those for trading physical products and those for online network games. E-
commerce is the most pervasive and prominent type. It is the business process of selling and buying the
products, goods and services by on-line communications. It can be highly beneficial in reducing business
costs and in creating opportunities for new or improved customer services, customers feel convenience to
order and are able to collect plenty of information to compare analogous products which are
manufactured from the different vendors. Vendors can trade globally and find new market with cut down
investment; service providers like Airlines can reduce cost

Electronic commerce, commonly known as e-commerce or e Commerce, consists of the buying and
selling of products or services over electronic systems such as the Internet and other computer networks.

Electronic commerce is generally considered to be the sales aspect of e-business. It also consists of the
exchange of data to facilitate the financing and payment aspects of the business transactions.

Electronic commerce that is mostly conducted between businesses and consumers, on the other hand, is
referred to as business-to-consumer or B2C. This is the type of electronic commerce conducted by
companies such as Virgin Atlantic

What is Business-to-Consumer or B2C

B2C describes activities of businesses serving end consumers with products and or services

What is Virgin Atlantic

Virgin Atlantic Airways Ltd. (operating as Virgin Atlantic) is a British airline owned by Richard Branson's
Virgin Group (51%) and Singapore Airlines (49%). It operates between the United Kingdom and North
America, the Caribbean, Africa, the Middle East, Asia, and Australia from main bases at London
Heathrow and London Gatwick.

Back in the early 80s Richard Branson was probably best known for Virgin Records - the legendary
record label that signed major names like the Rolling Stones, Janet Jackson and The Human League. In
1984, much to the horror of his directors, Richard announced to the world that a high quality, value for
money airline would begin operating within three months. Three months, some licenses, staff and an
aircraft packed with celebrities later, Virgin Atlantic Airways was born. By the end of the decade we had
flown over 1 million passengers and started shaking up services onboard by being the first airline to offer
individual TVs to their business class passengers.

Company Background and History

Since it was founded in 1984, Virgin Atlantic Airways has become Britain’s second largest carrier serving
the world’s major cities. Now based at London’s Gatwick and Heathrow airports and Manchester airport, it
operates long haul services to thirty destinations world-wide as far apart as Las Vegas and Shanghai.
Virgin Atlantic has enjoyed huge popularity, winning top business, consumer and trade awards from
around the world. The airline has pioneered a range of innovations setting new standards of service,
which its competitors have subsequently sought to follow. Despite Virgin Atlantic’s growth the service still
remains customer driven with an emphasis on value for money, quality, fun and innovation. Virgin Atlantic
has carried around 58m passengers since it began operations and now employs over 9000 people
worldwide.

Virgin Atlantic is the quintessential Virgin story. It has every ingredient: the small newcomer taking on the
giant and complacent establishment, the people’s champion introducing better service and lower costs for
passengers with a reputation for quality and innovative product development.

Virgin Atlantic was developed as an offshoot of Richard Branson’s Virgin Group, which was better known
at the time as a leading light in the world of pop and rock music. On 22 June 1984 Virgin’s inaugural flight
to Newark took place, a flight filled with friends, celebrities and the media. The airline’s aim was simple:

“To provide the highest quality innovative service at excellent value for money for all classes of air
travelers”.

Ownership

On 20 December 1999 Richard Branson signed an agreement to sell a 49% stake of Virgin Atlantic to
Singapore Airlines to form a unique global partnership. The cost of the transaction to Singapore Airlines
was £600.25 million, which included a capital injection of £49 million and valued Virgin Atlantic at a
minimum of £1.225billion.

Routes

Now based at London’s Heathrow and Gatwick airports and Manchester, it operates long haul services
from Heathrow to New York, Los Angeles, San Francisco, Washington, Boston, Miami, Chicago, Tokyo,
Hong Kong, Johannesburg, Cape Town, Nairobi, Shanghai, Delhi, Mumbai, Lagos, Mauritius, Sydney and
Dubai. Virgin also operates services from Gatwick to Orlando, Barbados, St Lucia, Antigua, Las Vegas,
Grenada, Tobago, Cuba, Montego Bay and Kingston. Virgin Atlantic also operates a service from
Manchester to Orlando, Barbados and St Lucia.

Virgin Atlantic’s thirty routes worldwide are broken down as follows:

10 routes to the US
6 Asia Pacific routes
4 African routes
1 Indian Ocean route
1 route to the Middle East
8 Caribbean destinations

Aircraft Orders and Fleet

Virgin Atlantic currently has a fleet of 38 aircraft, which includes thirteen Boeing 747s and six Airbus 340-
300s and nineteen Airbus A340-600s. The airline announced in March 2007 the order of 15 of the 787-9
Dreamliners – with options on ordering another eight 787-9 and purchase rights on a further 20 aircraft.
The order will see Virgin Atlantic take delivery of its new planes between 2011 and 2014. The airline also
has six A380 aircraft on order until 2013.
Company Strategy

So how does Virgin Atlantic remain so successful? One hint as to the reason for the
airline’s long-term profitability is its strategic planning and implementation. The company’s
organizational structure the core of its strategy is based on four principles:

(1) encouragement of independence

(2) a long-term approach
(3) competitive cost levels
(4) a loyal customer

All of management’s efforts in building the company stem from some aspect of these general
organizational values, and this direction gives Virgin Atlantic the momentum it needs to succeed as an
international firm.

As far as the value of independence goes, Virgin Atlantic emphasizes this concept as a
part of its overall appeal as an airline. Its mission values of caring, honesty, value, fun, and
innovativeness reflect the individual as the focal point for all its energies. In fact, Richard
Branson’s creativity is what has fundamentally driven the Virgin idea. Because so much of the
company’s appeal stems from its innovative approach to airline travel, its implemented strategy
matches the theory set by Branson. The atmosphere in the airports and in- flight reflects this
creativity and differentiates Virgin Atlantic from other airlines.

Virgin Atlantic has several strengths as a company and potential opportunities for growth, as shown in the
SWOT analysis below:

Strengths

• Differentiation based on value, service, and price

• Universal appeal to wide variety of customers
• Established and highly-recognizable brand image
• Innovative features that distinguish the company name
• Talented management team (i.e. Branson)
• Strong, well-designed organizational structure

Weaknesses

• Some underdeveloped channels (i.e. Premium Economy)

• Underdeveloped distribution system
• Marketing primarily focused on London market
• Ineffective utilization of alliances and partnerships

Opportunities

• Increased tourism with the improvement of the economy

• Alliances and mergers (the future of the industry)
• Airline growth post-recovery because of the trimming of the airlines since 2000
• Latin America as a low-terror, high growth potential market
• 280 airports within Europe (growth opportunity)
• No major carriers dominating Intra-EU aviation market
 • Germany, Spain, and France (next largest markets after UK)
• Asian market expectation (fastest growing over the next ten years)

Threats

• Terrorism leading to decreased tourism and confidence in the airlines

• Health problems (such as SARS)
• Regulation problem for airlines aiming to merge or grow (ie. antitrust legislation)
• On-going supply surplus resulting in maintained low revenues
• Internet booking allowing greater price transparency
• Improved telecommunications (i.e. video conferencing) decreasing business travel