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a. Introduction 1.0 Background Of Malaysia Airlines Malaysia Airlines System Berhad is also known as MAS in short. MAS is founded in 1947 as Malayan Airways, but it has change its name as Malaysian Airline System in 1 October 1972. MAS is the flag carrier which is own by government of Malaysia. MAS headquarters is situated at Sultan Abdul Aziz Shah Airport in Subang, Selangor. MAS operates flights at its first base in Kuala Lumpur International Airport, and secondary base in Kota Kinabalu. Malaysian Airlines System Berhad is the holding company for Malaysia‟s national airlines carrier, one of the fastest growing airlines in Asia. Malaysia Airlines has two airline subsidiaries, which is Firefly MASwings. Firefly operates scheduled flights from its two home bases Penang International Airport and Subang International Airport. The airlines focuses on tertiary cities although has recently launched services to Borneo from Kuala Lumpur International Airport. MASwings focuses or inter-Borneo flights. Malaysia Airlines has a freighter fleet operated by MASKargo, which managers freighter flights and aircraft cargo-hold capacity for all Malaysia Airlines‟ passenger flights. MAS are using this type of craft Airbus A330-200 and A330-300. Boeing 737400, 800 and 400/400. Malaysia Airlines operates a fleet of aircraft with two cabin configurations. Malaysia Airlines B777-200ER fleet has a two configuration which is Golden Club Class and Economy Class. Its B747-400 fleet has a three-cabin configuration, also including First Class. Malaysia Airlines premium cabins and Economy Class have been giving numerous awards for excellence in product and service delivery. From a small air service, Malaysia airlines have grown to become awardwinning airline with more than 1000 aircraft, servicing more than 110 destinations across six continents. The slogan for Malaysia Airlines is “Going Beyond Expectations”. On 25
January 2007, Malaysia Airlines launched MH Campaign which means Malaysian Hospitality.
BJIB3143 ELECTRONIC COMMERCE
Malaysia Airlines also practiced the online booking and buying to make their reservation or purchasing way easier for passenger. With this online purchasing, the passengers need to fulfil their details like the destination they want to go and the departure place they want. The payment will settling via the online banking. Internet user can book their air ticket, hotel , and train ticket and rent car via Malaysia Airlines Website. MAS is a type brick and click company. This is MAS offer both offline and online ticket booking systems. MAS allows customers to order air ticket and other services online, and other services also provided. MAS also have its ticketing counter and office in big city in selected state. The main products offer by Malaysia Airlines web-site is flight tickets. Besides, it also provides car rental, hotel booking, booking railway ticket and holiday packages. 1.1 History of Malaysia Airlines A joint initiative of the Ocean Steamship Company of Liverpool, the Straits Steamship of Singapore and Imperial Airways led to a proposal to the government of the Colonial Straits Settlement to run an air service between Penang and Singapore, resulting in the incorporation of Malayan Airways Limited (MAL), on the 12th of October, 1937. The 1960s was a significant decade; as the country that known as Malaysia was formed in 1963 (incorporating Malaya, Singapore, Sabah and Sarawak. Malaysian Airlines Limited not long after, welcomed Borneo Airways Limited into its family. There are changes a couple of years later, it is due to the split-up of
Singapore from Malaysia, but the airline continued to service in both countries as a bi-national airline, and renamed Malaysia-Singapore Airlines (MSA). As the airline continued to grow, with the contribution of both countries‟ governments (which
acquired joint majority of the airline in 1966), more international routes were expanded . In 1970, the defining moment of the airlines as we know it today. In the early decade – 1971 to be exact – both the Malaysia and Singapore governments agreed to set up separate airlines. Malaysians Airways Limited was formed. One year later,
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MAS became Malaysian Airline System (MAS). MAS were officially launched on 30 September 1972, the airline took to the skies as truly Malaysia‟s very own national carrier on 31 September– three months ahead of schedule. Great things were beckoning MAS in the 80s and logistical innovations ensured that the airline was on the right track. In February 1980, we implemented a computerised cargo retrieval system and a year later, MAS RM2.6million maintenance hangar was officially opened. The most significant moment for the airlines – and one that help build our future success – was the 1985 privatization of the airline, the first Malaysian government agency to do so. In November that same year, the now-private entity MAS was listed on the Kuala Lumpur Stock Exchange. In 1987, we shortened our name to Malaysia Airlines. In 1991, the airline received the 1990 Asian Institute of Management/World Executive‟s Digest Management Award in the General Management category. That same year, we accepted the TDC 1990 Tourism Gold Award and one year later, our fourth Boeing award for dispatch reliability of our B737 fleet. Throughout the 90s, we consistently came out tops in several airline surveys conducted by such renowned organizations as In-flight Research Services (IRS), UK. Skytrak UK first awarded us World‟s Best Cabin Crew in 2001 and to date – the most recent award just a few months ago – we have won this coveted title 6 times. Skytrax also ranked us a 5-star airline in 2005, a prestige we have continued to uphold. The new millennium saw MAS achieving their dream of being an internationally recognised and respected airline by the 21st century. Besides the numerous awards (over 100 in the last decade alone), we continued to be a dominant force in the Asian and global airline industry. In December 2005, Dato‟ Sri Idris Jala joined Malaysian Airlines as our Managing Director/Chief Executive Officer. Dato‟ Seri Idris introduced the airlines‟ three-year Business Turnaround Plan in 2006, which restructuring of domestic andinternational flight routes. These moves would prove successful; in just two years,
2 Vision.3bil in 2005 to a RM851million net profit in 2007. Mission and Objective Vision i. To be the World‟s five star value carrier(FSVC). Highest level of safety Satisfy legal requirements Operations are conducted in the most efficient manner Drive structural cost management Ability to map efficiency in each area of operations Position as benchmark in the aviation industry 4 . iii. iii. iv. An airline uniquely renowned for its personal touch. ii. comfort and punctuality. vi. efficiency and quality of service. ii. iv. To be the airline of excellence Going beyond expectations Mission i.BJIB3143 ELECTRONIC COMMERCE Dato‟ Seri Idris turned the airline around from a nine-month loss of RM1. To be a profitable airline List of Objectives i. ii. iii. To provide air travel and transport service that rank among the best in terms of safety. Make Malaysia Airlines one of the leading standard bearers for the airline industry in term of safety. v. 1. warmth and efficiency.
Dato‟ Eddy Leong Chin Tung Managing Director. Shahari bin Sulaiman Managing Director. MD‟s Office 11.3 Organisational Structure Figure 1.. Tengku Dato‟ Azmil Zahruddin bin Raja Abdul Aziz Managing Director / Chief Executive Officer 2. Captain Mohamed Azharuddin bin Osman Director of Operations 4.0: Malaysia Airline System Organizational Structure Senior Management of Malaysia Airlines 1. Mohd.BJIB3143 ELECTRONIC COMMERCE 1. MASkargo 12. Effendi bin Abdul Rahman Senior General Manager. Human Resources 10. Azha bin Abdul Jalil Chief Executive Officer 3. Muzzaffar bin Othman Senior General Manager. Dato‟ Captain Mohd Nawawi bin Awang 9. Firefly 5 .
BJIB3143 ELECTRONIC COMMERCE Senior General Manager. Captain Dr Ooi Teong Siew General Manager. Dato‟ Mohd Salleh bin Ahmad Tabrani Managing Director . Security.MASwings General Manager – Transition Management 14. Esther Yap Siew Yen Chief Internal Auditor 13. Shahjanaz binti Kamaruddin Company Secretary 6 . Dr Amin Khan Senior General Manager. Sales & Marketing 8. Dato‟ Bernard Francis Senior General Manager. MAS Aerospace Engineering 16. Mohd Roslan bin Ismail Senior General Manager. Engineering & Maintenance Managing Director. External Relations 5. Network & Revenue Management 7. Corporate Safety. Indira Nair Senior General Manager. Communications 6. Health and Environment 15.
7 . The web page is easy to use and have simple interface. so it is user friendly and interactive. but it looks interesting and nice interface.BJIB3143 ELECTRONIC COMMERCE b. Website Walk-through Figure 1. Although Malaysia airlines use only a few of colour . The web page don‟t just have two types of colour that is blue and red.1: Malaysia Airlines Homepage The above picture showed the homepage of Malaysia airlines. The Organisation and Internal Workings i.
8 . personal details and address details. Then you will have to fill in your logon details. you should find the sign up button at the top of the screen. If you are a user of Malaysia Airlines. Step 2: After click the sign-up button. then you should click login. the web browser will direct me to a register page.1: Register as a user for Malaysia Airlines (Step 1) Step 1: To register as a user for Malaysia Airlines.BJIB3143 ELECTRONIC COMMERCE To register as a user for Malaysia Airlines Figure 1.
2: Register as a user for Malaysia Airlines (Step 2) 9 .BJIB3143 ELECTRONIC COMMERCE Figure 1.
then you should tick on “Remember me on this computer After you fill in the logon details.3: Register as a user for Malaysia Airlines (Step 3) 10 . Date of birth. last name. then you should tick “sign up for get the deal”. city. you will have to tick “I have read the terms and conditions and the privacy statement”. Next. it is to fill in personal details of youself. you will have to fill in my username and password. you will have to fill in my address. email.BJIB3143 ELECTRONIC COMMERCE Step 2: At the logon details section. This information is required every time you log in to this web-page. it is to fill in address details of myself. you will have to fill in my salutation (if have). you should to tick “I am happy to receive mailings from time to time”. country and postcode. After fill in all the personal details. state. and telephone number. After you fill in the personal details. Figure 1. gender. Next. If you want to fly with best deal. If you want to receive notification from MAS Airlines. title. At the address details section. first name. At the personal details section. If you want my computer to remember the username of your account.
11 .BJIB3143 ELECTRONIC COMMERCE Step 3: After you make sure fill in the all the logon details. Then. you click register button at the bottom of the register page. it will direct you to the next page. Next. personal details and address details.
12 .5: Register as a user for Malaysia Airlines (Step 5) Step 5: When successful register. It will show the logon details. If got any changes.BJIB3143 ELECTRONIC COMMERCE Figure 1. the above page will show. personal details and address details you fill in earlier. you can change the information by click the edit button in each section of the details.
BJIB3143 ELECTRONIC COMMERCE To booking flight ticket via Malaysia Airlines Figure 2. you should fill in your username and password which you register earlier. To login. 13 . Move your cursor to the login button.0: Booking flight ticket via Malaysia Airlines (Step 1) Step 1: Before Book flight ticket. you should find the login button at the top of the screen. then a drop down login box will appear.
business and economy. Customer can choose types of classes airlines such as first. 14 . customers can choose types of currency display. You can choose return. You must choose your flight depart and arrival place and date. you can click continue to the next page. the web browser will direct me to the book a flight page shown above. Besides.BJIB3143 ELECTRONIC COMMERCE Figure 2. one way or flexi return ticket. Besides. After select all the ticketing detail.1: Booking flight ticket via Malaysia Airlines (Step 2) Step 2: After login. a person can book more than 1 ticket that is adult orinfant(baby which is under 2 years old).
BJIB3143 ELECTRONIC COMMERCE Figure 2. This page will show the depart and arrival place and date and price of the ticket. Click continue if don‟t have any changes. 15 .2: Booking flight ticket via Malaysia Airlines (Step 3) Step 4: this page will show the detail of the flight depart.
enrich miles. 16 . change of booking. and cancelation after departure.3: Booking flight ticket via Malaysia Airlines (Step 4) Step 4: this page will show the detail and term and condition of the airlines services. It include discount level. You can click continue to the next page if every details is correct. If any changes. stand by airport. payment. advance purchase. advance seat selection.BJIB3143 ELECTRONIC COMMERCE Figure 2. Baggage allowance. upgrade. click the button back to change the details of your ticket.
17 . This part is automatically fill in if you already login as user. title. It will show the name. If all the details is correct .BJIB3143 ELECTRONIC COMMERCE Figure 2. enrich card number.4: Booking flight ticket via Malaysia Airlines (Step 5) Step 4: this page will show the detail of the consumer. click continue to the next page. contact details and e-mail address.
BJIB3143 ELECTRONIC COMMERCE Figure 2.4: Booking flight ticket via Malaysia Airlines (Step 5) 18 .
BJIB3143 ELECTRONIC COMMERCE Step 5: This page will show the trip summary such as price. It include the age and country of residence. In the fourth part. If you don‟t want to purchase the travel insurance . tick yes if want the services of insurance. In the third part. you can click no. 19 . If all the details is correct . click continue to the next page. The second part is travel insurance. consumer can choose to rent a car using this web-service. The first part will show seat preference such as the name of the passenger and the flight seat number. thanks. departure date and time. you can choose time and date to pick-up and drop off the rental of vehicle. you can choose to rent or not using the car rental services. At the last part.
BJIB3143 ELECTRONIC COMMERCE Figure 2.5: Booking flight ticket via Malaysia Airlines (Step 6) 20 .
You must tick which you are agreed with the agreement before you can confirm the payment. After you finished check all the details. price. credit card number. place and promotion. and the fares term and condition.BJIB3143 ELECTRONIC COMMERCE Step 5: In this page will show the details of the flight such as flight number. 21 . Malaysia Airlines need to have strategy must have different elements in the marketing mix. The 4P‟s in the marketing mix strategy are refer to product. customer must fill in the details of payment such as cardtype. Marketing mix is the combination of tools that are used by Malaysia Airlines to satisfy customer need and achieve company objective and goal. If the card holder are travel with this flight. issuance country. name of the card.and billing address. Lastly. tick “yes. The goal is to decide the 4P on the customers in the target market in order to create perceived value and generate positive feedback. type of aircraft. the cardholder is travelling with this trip. ii. PPPP Description In order to achieve marketing objective. expiry date. you are done with the purchasing of flight ticket online. security number. class. depart and arrival of place and time.
business class and economy class.BJIB3143 ELECTRONIC COMMERCE Product The term “product” refers to tangible. hotel booking. in Malaysia website. it also provide car rental. To purchased ticket online. booking railway ticket and holiday packages. Mandarin and Tamil when they call Malaysia Airlines call centre. 22 . Besides. Call centre service is available from 8am to 10pm on weekdays and from 9 am to 6pm on weekends. e-ticket and photo identification. Nationwide call centre Customer can use English. Each class has its own entertainment devices. Malay. customer need a valid credit card. then you are ready to travel. MAS online booking only accepts a valid Visa or MasterCard. customer need to have a valid credit card. business class used select 3000i as its entertainment devices and economy class used retractable LCD screen as its entertainment. physical products as well as service. Currently. Singapore and brunei. For those who are living outside Malaysia. e-Ticket An e-Ticket is an electronic ticket. customer no need worry about ticket lost or being stolen when traveling. The seats and services are different between each classes. For first class it used select 3000i as its inflight entertainment system. Services Malaysia Airlines cabin which have three class which is first class. The call centre number is 1300-88-3000 and it handle calls from Malaysia. an e-ticket reference and detail will be sent to your e-mail when registration. With an e-ticket. After booking has been confirmed. Easy Payment To book ticket and purchase online. customer no longer need to collect paper tickets. If you have booking reference. It also means defining the characteristic of product or service to meet the customer needs. you can call 603 7843 3000. With e-ticket.
Malaysia Airlines is make earnings from fuel surcharge. Therefore. Since the launched of this programme till 14 may 2008. Everyday Low Fares offers 1. To strengthen is online booking service. MAS is partnership with GRSNetwork to reduce its distribution cost and to simplify the ticketing process. administrative fee and airport tax. The use of internet allow customer access to MAS inventory worldwide. 23 . Malaysia Airlines the programmes to all ASEAN routes operated by Malaysia Airlines. Malaysia Airlines is planning a major expansionon its booking facility by the end of 2005.3 million RM 0 for all domestic routes operate by Malaysia Airlines and Firefly.000 seats. This programmes has been strongly opposed by Air Asia which claim that directly business model with Malaysia Airlines and not allow budget carrier compete with national airlines. The Everyday Low Fares programme offers a maximum of 30% of the total seats on every flight which are unsold factor of 70% on each flight. Malaysia Airlines has sold more than 150. MAS is expected to cut distribution costs by more than 50% when it adopt an Internet-based distribution network. its allow MAS to reduce airlines distribution cost significantly. Internet booking Malaysia Airlines internet booking system is launched in august 2004.BJIB3143 ELECTRONIC COMMERCE Price Price means the value or the worth of a product that a buyer are willing to pay for it or exchange the product value for money. MAS web-site allow customer faster access to information to their traveling needs and use Malaysia Airlines products and other services. Using the internet booking system. looking at a location where a service is delivered. Place Distribution is getting the products to the customer. Everyday Low Fares Malaysia Airlines have launched its Everyday Low Fares programme on 6 May 2008.
The company plan to use this travel fair to raise the Malaysia brand awareness and stimulate demand. With the expansion of customer service. 24 . During 22-24 February 2011 at the fair.BJIB3143 ELECTRONIC COMMERCE Sales Offices These are available at airports counter and town centers kiosk for the convenience of walk-in customers. Malaysia Airlines Travel Fair (MATF) Malaysia Airlines Travel Fair is to offer attractive air fares and holiday packages. Promotion Promotion means the various aspects of marketing communication. The company will get to explore opportunities of businesses of organise travel fair in selected international markets. it will increase the operational budget. Kunming. hire and maintenance of equipment. there are also deal offered is „buy 1 get 1 free‟ promotion on business class for airlines to Asean cities such as Xiamen. passenger sales expenses and other expenses. The increase of operation cost is due to higher staff costs. there will a 70% discount off from current market. Macau and discounted golden holiday packages for domestic and international travel. Improve Customer service The Customer service operations use to cope with the higher passenger load and additional flights. The communication of the product with the goal will generating a positive customer response. passenger layover and delay costs. Besides.
MHdeals is a free application that use iphone GPS sensor to locate airport around you and display the best Malaysia Airlines deals. MASholidays is a deal that provide holiday package that suit a variety of budget. Besides. Deals of the day allow customers enjoy big saving on your next. This promotion offer amazing low prices and all balik kampong bargain. MHdeals. In Malaysia Airlines web-site. Balik kampong deal is for those who always feel homesick. you are able to purchase air ticket with discount price and enjoy exclusive member only fares. Redeeming coupon is easy. just key in the coupon code when booking for flight ticket.BJIB3143 ELECTRONIC COMMERCE Deals In Malaysia Airlines web-site. With the peaceful and harmony environment. Malaysia become one of the popular and famous place with attractive travel destinations. this deals include exciting destinations at a fantastic prices. MHcoupon is a new way allow customer to enjoy exclusive saving on Malaysia Airlines flight. The online coupon comes in the form code. balik kampong. Competitors and External Environment i. there are special deals such as deals of the day. PEST analysis 1. and MASholidays. There are more advantages if become a member. Political factors Political factors are vital to ensure the growth of the airlines industry in Malaysia. there are special promotion for member and nonmember. c. customer of MAS will get latest tourist information to explore the tradition and natural beauty of Malaysian holiday destination in borneo. with the use of the application. 25 . MHcoupon. It include holiday package within Malaysia and outside of Malaysia at an attractive price. it does not required printing or cutting necessary. If register as member.
Social factors The social factors are element such as beliefs. MAS have introduced MASholiday. Increase income and economic growth will lead more people to board on aircraft. People are prefer to travel by air is because it is more convenience. When the global facing a downturn. Malaysia are consists of diversity composition ethnic of the population and have different cultural and tradition that will attract more tourists. In the fourth quarter of 2009. demographic. Government carried out campaign will help boost tourism and airlines industry. minimum wage legislation. purchase train ticket. in 2009 . and travel insurance. and many other actions is exists to protect employees. miles redemption options online and new services. administrative fee and airport tax) to attract more customers in the region. The changing of Malaysia lifestyle will help the growth of the airlines industry in Malaysia. more people will prefer to enjoy flight with low costs. Global economic recovery will increase growth in load factors. MAS returned to operating profitability with RM 3. customers. 4. 2. religious. MAS offers a maximum of 30% of the total seats on every flight which are unsold factor of 70% on each flight with zero cost (excluding fuel surcharge. pollution and pricing policies. attitudes. opinions and lifestyles of a person will affect a firm external environment such as cultural. car hire. Malaysia are become more affordable to travel by air. value.8 million profit. PSS is to ensure faster service delivery. tax programs. Fairtrade decisions. antitrust laws. Economic factors Despite stiff competition in the airlines industry. MAS upgrade its in-flight entertainment system with Matsushita 26 . quicker online purchase. educational and ethnic. Malaysia Airlines launched its Everyday Low Fares promotion.MAS implemented passenger services system (PSS). ecological. 3. With the increase of gross national income per capital. Technology factors Malaysia Airlines provides online service for booking air ticket with hotel booking.BJIB3143 ELECTRONIC COMMERCE Besides. the online promotion is for customers to book holiday packages online. the general public and the environment are constraints to political factors.
and education level are common demographic variables. magazine advertisement and etc. It is because travel and business magazine reader are from businessman or traveller. they would choose the airlines because it give passenger a general of the airlines services. Major of Airlines Company has removed first class because it is highest service in airlines service. 2. Media such as television advertisement. sms and interactive flight information on all classes. MAS always used magazine advertisement as a medium to promote its services and help the growth MAS in the airlines industry. income. Market analysis a. Executive class usually are most luxurious class in airlines services and it is the most expensive compare with business and economy class. It is a best decision for MAS to advertise in magazine advertisement in travel magazine and business magazine. advertisement board. business purpose and etc. Airlines services is focus to those who like to travel. 27 . Many airlines use business as the highest level of service Economy class also known as coach class and it is the cheapest compare with executive and business class airlines services. MAS have split its airlines in to three different classes that is executive. Media segmentation Media is a mean possibility of medium that tend to reach the audiences. If traveller and businessman who are attract to the advertisement in the magazine. the system have digitized on-demand audio and video media include new games.BJIB3143 ELECTRONIC COMMERCE System 3000i on Boeing 747 and Boeing 777. example. business and economy class. Demography segmentation Element such as gender. For business class airlines are medium class services and it is more expensive but cost less than executive class. ii. Market segmentation 1. media segmentation is often being used by companies to promote its products or services using that media. age.
Market Strategy Malaysia Airlines strategy is to transform its airlines in to Five Star Value Carrier (FSVC). words. The questionnaire will include a behaviour section such as frequency of flying. pictures and etc. Qualitative research provides the insight. 4. emotions. In person interview and internetbased interview are frequently use by airlines industry. values. who travel with. To design a market segmentation questionnaire for airline. money spend on airlines tickets and etc. MAS must conduct depth interviews to create questionnaire. The different in household income allow MAS to generate segmentation for price dimension. medium-priced and expensive services. The internet is valuable for segmentation studies. the conceptual knowledge and the consumer‟s language to design the questionnaire about consumers lifestyle. b. perception and interests. 28 . Price segmentation Price segmentation is common and widely practise by airlines industry. purpose of travel by airlines. 5 Star MAS must improve its products and services to develop it become high quality products and services. then MAS should offer low-priced. behavious. Economy class airlines is focus for low income group. Lifestyle segmentation is to segment a market. If consumer incomes range from low to high. respondent can paying full attention and take time choose their own opinion.BJIB3143 ELECTRONIC COMMERCE 3. income. Business class airlines are usually for the medium income group such as traveller and business purpose for businessman. In person interview produce more accurate answers. Example. how to purchase tickets. Executive class is airlines service for those are higher income passenger and for business purpose such as CEO or director of a company. occupation. There are 5 Strategy which is: i. Lifestyle purpose segmentation Lifestyle segmentation investigates the consumer attitudes. MAS can identify the segmentation variable from lifestyle statement.
it will attract more consumers choose to fly with Malaysia Airlines. Government which sign agreement with international airlines will gives threat to Malaysia airlines such as Air Asia and MAS. Grow network and build capacity With more revenue. Competitive Fares If MAS has lower costs structure. Other competitor analysis Porter Five Force of industry analysis model (Malaysia airlines) Threat of new entrant a. This will generate more revenue and help in MAS growth. iv. international airline have to sign MOU to allow landing on KLIA. So it will able MAS to offer lower fares to being competitive in the airlines market. Government tend to increase usage of KLIA as the main hub in Malaysia. International entrant The international competitor are airline such as Singapore International Airways. Exists of competition is due to outdated regulatory system. MAS invest in growing its network and building its capacity. it will be able for MAS to offer low and competitive fares to consumer. v. Lower Costs MAS should reduce its structural and operational costs.BJIB3143 ELECTRONIC COMMERCE ii. International Entrants i. MAS will open up more routes and purchase iii. It will give MAS competitive advantages to compete in the airlines market and make profit. Increase customers and revenue With high quality services and products at low fares. By invest in growing its network. 29 . Thai International Airways. iii. Cathay Pacific Airways and Garuda Indonesian Airways.
MAS is hard to change to another supplier. Competitive Rivalry 30 . e. Sea and land journey can be replace with other mode of transportation. MAS mechanic are more familiar with boeing aircrafts. So MAS don‟t have to worry about threat or exist of other mode of transportation to air travel especially longdistance travel. SIA and UAE are providing better quality services to compete with each other to attract more customers to travel with their airlines. Besides. Therefore. But for short distance journey. but Airbus put a lots of effort again and again to enter the supplier market. MAS is one of the option that customer can choose from. b. With limited of MAS can choose from. Substitutes Where time is matter in long distance travel. timeefficient. In the local market. In the international market. d. air travel almost can‟t replace with other alternative. Air Asia is trying hard to compete with MAS through promotion and advertisement to attract many local passengers to use Air Asia to travel within Malaysia. other mode of transportation are not convenience. customer prefer would to use on land transport such as car and bus. and comfortable if compare with travel by air. Air Asia compete with MAS by providing low cost services to its customer. Bargaining power of Supplier The main supplier of MAS aircrafts and accessories is boeing. Boeing are major supplier of all aircrafts and services. Bargaining power of Buyer Price. c. customer are able to choose which airlines that suit their need.BJIB3143 ELECTRONIC COMMERCE ii. For short distance travel. With a lots of airlines company in the market. quality of service. convenient and comfort are concern to customers. Local entrant The exists of Air Asia which is low cost and budget airlines are competitor for Malaysia Airlines. MAS have been using boeing aircraft and part since its established. Boeing can increase its price in aircraft and parts. in long distance travel.
Singapore Airlines is a big and strong competitor that is well known for its services that will give negative impact to Malaysia Airlines. US and European airlines merged to form a large airlines group in order to compete in the large competitive market. Malaysia Airlines are able to maximise yields on peak flights and expand market share on non-peak flights. The increasing in yields is due to strong load factor to leverage on. 31 . there are points can show the strength in Malaysia Airlines. In the international market.BJIB3143 ELECTRONIC COMMERCE In the regional market. For example. SWOT Analysis STRENGTH Malaysia Airlines has its own abilities of strength of their fundamental business use to compare itself with other service company based on value. Additional capacity of aircraft will influence yield and yield recovery maybe slower than expected. d. Implement a highly competitive and dynamic pricing. Increase in yield Increase in yield mean revenue per passenger kilometre. I have studied and analysed the strength of MAS. Malaysia Airlines have their own branding strategy involve its stewardess to promote its airline. price and services. MAS airlines has built a strong name in the airlines service industry. Highly recognizable brand name Malaysia airlines is one of the service companies that established for more than 70 years being the oldest airlines company in Malaysia and its brand image has been highly recognized. Malaysia Airlines put a lot of effort on their branding and advertising and major around flight crew. Malaysia Airlines decided to use the “going beyond expectation” as their slogan to market itself internationally and promote its excellence of quality service. there are a lot of airlines company that compete in the market lead to competitive price and quality of services. Using branding strategy will help MAS to establish strong brand image internationally and locally.
000 or 15%. Low labour costs When MAS carried out staff reduction or downsizing. this is due to MAS was overstaffed. training was conducted to calculate good habits and service quality the front line ground staff. Besides. air catering and tour operations. aviation engineering. A blanket recruitment and training was established to save operating cost. Besides. Reduce of labour will allow MAS to save on labour cost and increase effectiveness. MAS also recognised as Asia‟s Leading Airlines the World travel Awards and Best Airlines in southeast Asia by the Global Traveller magazine. MAS has diversified into related industries such as aircraft ground handling. Awards and Recognition MAS has won various awards from international body and is recognized by the IOSA for safety practices. Well-trained employees To improve service level of customer service agents. 32 . MAS has the labour cost compare with other airlines. training is arm together with flight safety department introduced to evaluate training footprints for the entire fleet consistent with the latest in the industry. MAS won the 5 star Airline award for the fifth consecutive year as well as regained the position of world‟s best cabin staff. Its staff size reduces by 3.BJIB3143 ELECTRONIC COMMERCE Diversified revenue stream Malaysia airlines generates revenue from various services such as flight operation and Aircraft cargo. MAS have revenues coming from non-aeronautical areas such as maintenance. but also MAS business customers. overhaul and aircraft handling. not only to satisfy passengers. MAS branding strategy is to provide hospitable and friendly service to represent good image to the public. Its flight attendants undergo extensive training. MAS airlines use their flight attendants to promote the airline. These awards showed that MAS continue to deliver better products and services. aircraft leasing. To enhance flight safety. repair. In the year 2009. Low labour cost structures and high productivity have more competitive advantages over company with labour costs.
its operating margins are below the industry average. handling and landing fees. Darwin. Low margin Although MAS has a strong revenue growth.BJIB3143 ELECTRONIC COMMERCE WEAKNESSES Weaknesses is the things that MAS does not do well or other airlines company are doing better. From assessment. High costs Costs include staff costs. 33 . higher costs is because of security and environment policies. This is due to the airlines growth plans and MAS competitive disadvantages. The rising cost of fuel will lead to high cost of operation. Weak cash flow means that spending is more than earning.36 million loss which was caused by the increasing fuel prices. aircraft maintenance and overhaul charges. Sometimes. Several weaknesses were due to the RM 1. Unprofitable routes In 2000. The amount loss can be recognise in income statement. MAS claimed that it was losing passengers to other carriers on this route because of insufficient capacity. Weak cash flow is due to impairment losses. The amount of loss is measured is difference between the asset carrying amount and the present value o estimated future cash flows. Some routes have been discontinue due to insufficient passenger demand. and other financing. MAS found it is difficult to achieve operating profit margin at sufficient level finance such as capital expenditure. Munich and Vancouver. MAS still have some weaknesses as other airlines company have. Madrid. Honolulu. the airline suffered further losses lead to mas airlines suspend its flight to unprofitable routes such as Brussels. Weak cash flow The airlines reporting negative inflow cash from its operations.
Asia country demand for travel is high. Low productivity were due to poor management and poor technology. india and the middle east.more than 15% of MAS revenue comes from the Asian region. OPPORTUNITIES Opportunities are the chances in the industry which could utilized by the company to make it more positive respond in the market. Ineffective utilization of resources and partnerships. Firefly is Malaysia‟s first communities airline. This is due to growth of export related industries. Increasing cargo traffic There has been an incease in cargo traffic in south east Asian countries. both operating 7 and 10 ATR72-500 aircraft accordingly. It is expected to gain a potential customer base of 100 million in the Indonesia-malaysia-thailand area.5%. cargo traffic improved by 26. Besides. Its Firefly and MASwings have recently completed their fleet renewal exercise. 34 . In asia pacific. cargo traffic posted a significant growth of 34.BJIB3143 ELECTRONIC COMMERCE Low Productivity Marketing skills are inefficient and are only focused on expanding to fast. It‟s headquarter are at Jalan Airport in Miri. It‟s headquarter are at Sultan Abdul Shah Airport in Subang. Launch of firefly and MASwings Firefly and MASwings are subsidiaries of Malaysia Airlines. Firefly first flight was on 3 april 2007 at penang. international passenger demand up by 9.5% year-on-year. In February 2010. Expanding passenger traffic MAS airlines covers several destination in Asia such as japan.5%. MASwings first flight was on 1 October 2007. In February 2010. MAS airlines benefits from the increase in demand for air cargo services. Sarawak. MAS airlines set up firefly for test-bed to manage low cost operation.5%. china. passenger traffic grew by 13. Hence. In asia pacific. Low productivity is because MAS was overstaffed.
MAS have direct competitor that are Singapore International Airways. THREATS Threat are factor from external environment of the MAS company which could negative influence the company. The changes of customer preferences are because of factors like demographic. some airlines gone bankrupt because airlines financially weak airlines are expected to follow suit. With increase of fuel price. Besides. Increasing fuel prices The dramatic increase of fuel prices affect most airlines. Based on the survey and research have been done by MAS. and geographic factor. Thai International Airways. psychographic. The increase in fuel price will lead to increase operation costs. 35 . Malaysian Airlines should introduce new concept. AirAsia is airlines that provide low cost to customers. the poor performance of economic and market will lead to increase of fuel prices. it is because human beings can easily having a change in their life. The weakening of foreign exchange will possibililty increase fuel prices. MAS has more menu options available for customer to choose from. It is one that influence operating expenditure for MAS airlines. High competition MAS faces strong competition from other airlines. A total of 37 menus are available over 8 week cycle rotation to ensure frequent travellers will be able to enjoy different kinds of meals. this will lead to losses or lower profit. MAS should introducing hot meal boxes in response to customer preferences. MAS has to deal with local airlines in the same field is AirAsia. There are Asian and Western meal to suit all customer needs and desires. Its airlines faced major competition internationally from established airlines and new start-up operations. Cathay Pacific Airways and Garuda Indonesian Airways if compete intenationally.BJIB3143 ELECTRONIC COMMERCE Changes in customer preferences Customers have different needs and desires in term of purchasing.
As one of the airlines company. MAS needed more US dollars to balance its foreign exchange requirement. In global economic downturn. it will lead to slow growth in demand for air travel. This will lead to decrease of confidence in the airlines. The H1N1 pandemic and swine flu will lead to weaker demand of airline flight. Terrorism and Health scare Terrorism is leading factor of decrease tourism and airlines business. Terrorism might happen in many ways in certain country or it might happen inside the place such as plane being hijack. There are passenger with H1N1 boarding with Malaysia Airlines will lead to decrease of customer to fly with MAS. When the European economy is lagging. MAS airline serves more than one hundred destinations worldwide. If terrorism happen in area of southeast Asia. it will affect all the business worldwide. MAS treasury unit in the finance division handle cash and fund management such as credit management and foreign exchange. The outbreak of disease will affect the airlines industry significantly. It‟s will give a big impact to the company if the big changes in the economy level. Economy Changes in economy will directly influence business positively or negatively in many aspects. The airlines uses foreign currency as strategy to manage risk the risk of foreign fluctuation. MAS will have to stop all their operation and flight to the southeast Asia for a period of time. Undertaking this risk will lead to decline in growth.BJIB3143 ELECTRONIC COMMERCE Foreign currency fluctuation MAS revenue is from different foreign currencies which result in the fluctuations of foreign exchange rate. Malaysia airlines have lot of collaboration with other company throughout the world. MAS inefficient foreign exchange management could make the company more than $10 million a month. 36 .
To become a Five Star Value Carrier. Besides. MAS should providing frequent flight at high profitable route. Conclusion Malaysia Airlines objective is to transform into a Five Star Value Carrier (FSVC) in the future. MAS should train or employ staff which can multi-tasking. MAS must these have step such as 5-Star. Malaysia Airlines should use marketing mix technique to employ sales employee who are good in promote and have ideas to improve marketing Malaysia airlines services. It is important because its allow MAS to landing in other destination internationally. a studied is carried out to identify routes which are unprofitable for MAS and discontinuing flight to the destination to minimize its losses and focus on high profitable route. To become a profitable airlines. and grow its network. Malaysia Airlines should maintain its relationship with other airlines company. MAS should reduce on its high operation costs by manage and structure its costs and budgeting. generate more customer and revenue. To overcome Malaysia Airlines weakness. and it also allow to expand its flights and services at the same time. MAS also should give training to its manager in order to improve its management. 37 . competitive fares. so it would minimize the problem overstaffing.BJIB3143 ELECTRONIC COMMERCE e. lower costs.
Captain Mohamed Azharuddin bin Osman. “Business Transformation plan”. Nizam.decisionanalyst.listedcompany.com/doc/42811566/Malaysia-Airlines 5.com/MAS. Geoffrey Thomas.tripod.com/pt/themes/default/images/MAS%20historyAugust09. Retrieved April 3. from http://www. Wikipedia. 2008.2009. Retrieved March 28. Retrieved March 27. Berjaya Group Information. Thomas.html.com/misc/DeliveringOperationalExcellencetoou rCustomers. from http://malaysiaairlines. 2011. from http://uia2k.78. 2011.pdf 6. Retrieved April 1. 2. 2011. 2011. 2011.htm 4. Transforming Malaysia Airlines. 2010. Retrieved April 12.malaysiaairlinesblog.com/Downloads/MarketSegm.pdf 3.53/PAM10/Malaysia_%20Airlines_Bernard. MAS history. 2007.scribd. from http://www. 2011. from http://64. Retrieved April 12. and firithal B sahari. from http://www. from http://www. Investing for the future. 2011.com/content/dam/mas/master/en/pdf/corporateinfo/Business%20Transformation%20Plan%20(BTP%202). 2011. Mohaini. from http://www. 2011.ppt 6.BJIB3143 ELECTRONIC COMMERCE REFERENCE 1.malaysiaairlines.36. Retrieved March 09. Market Segmentation. Bernard Francis.Malaysia Airlines System Berhad. Jerry W. “Core business of Berjaya Group”. Zainal.com/businesse.berjaya. Retrieved April 12. 2010.pdf 38 . 2007. Delivering Operational Excellencetoour Customers.pdf 7. Mizwan.
2011. Nizam.malaysiaairlinesblog. Retrieved April 3. Zainal.tripod. Berjaya Group Information. Malaysia Airlines should use marketing mix technique to employ sales BJIB3143 ELECTRONIC COMMERCE costs by manage and structure its costs and budgeting. Transforming Malaysia Airlines. and firithal B sahari. 2011. MAS also should give training to its manager in order to improve its management. Mizwan.berjaya. from 39 . Wikipedia. “Core business of Berjaya Group”. Besides. MAS should train or employ employee who are good in promote and have ideas to improve marketing Malaysia airlines services.html. from http://www. REFERENCE 1.2009.htm 4.To become a profitable airlines. Retrieved March 09.com/pt/themes/default/images/MAS%20historyAugust09.com/MAS.com/businesse. from http://www. MAS should reduce on its high operation staff which can multi-tasking. Retrieved March 27. MAS history. from http://uia2k.Malaysia Airlines System Berhad. 2011. 2007. Geoffrey Thomas.pdf 3. Retrieved March 28. Mohaini. 2011. 2011. 2. so it would minimize the problem overstaffing.
from http://malaysiaairlines.malaysiaairlines.53/PAM10/Malaysia_%20Airlines_Bernard. Bernard Francis.com/Downloads/MarketSegm. “Business Transformation plan”.decisionanalyst.com/misc/DeliveringOperationalExcellencetoou rCustomers. from http://www. Retrieved April 1.http://www. 2008. 2007. 2011. 2011. Retrieved April 12. Thomas.pdf 3. 2011.com/doc/42811566/Malaysia-Airlines BJIB3143 ELECTRONIC COMMERCE 1. Market Segmentation.ppt 2.pdf 6.36. Investing for the future.pdf 40 . Delivering Operational Excellencetoour Customers. 2011.78. Jerry W. from http://64. Retrieved April 12. from http://www.scribd. 2010. 2010.listedcompany. Captain Mohamed Azharuddin bin Osman. Retrieved April 12.com/content/dam/mas/master/en/pdf/corporateinfo/Business%20Transformation%20Plan%20(BTP%202).
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