Week 8 - Branding and Marketing
Show
the market exists for your product
Population
of USA is 315,608,000. there are 642,000 passengers annually. 2% of
the population travel each year. If we can assume that China will
also follow close that percentage as it grows. There could be a huge
market with China having
a population of 1,353,821,000.
Following a couple of low growth years, it has began to pick up, and
travel is forecasted to be 450 million passengers in 2015. It is
also expected to increase sharply with forecast of 700 million
passengers by 2020. Interestingly, “China Eastern's fleet change
appears driven by the need for more narrowbody aircraft to match
expected domestic and regional capacity”. There seems to be a
growth in demand of domestic flights. They have ordered B737/B787
which are narrowbody and medium body airplanes used mainly for short
and medium flights. This trend to a growth in domestic flights is
backed up by Ascend's analysis of China's airplane orders. They say
that 150 narrowbody units have been ordered, overshadowing only 16
widebody units. Domestic air traffic is leading the growth in China
and high speed rail will not hinder it. Popular
destinations: Hong Kong led the list, followed by Macau, Taiwan,
South Korea and Japan.
Identify
customer groups
“According
to a survey released last month by the Hurun Reportand International
Luxury Travel Market Asia, the typical wealthy Chinese outbound
traveler typically goes on holiday three times per year for an
average of eight days, traveling in a group of nine. Though more
seasoned Chinese travelers are being seen engaging in more
experience-based activities — anything from scuba diving in Hawaii
to safaris in Africa, shopping still remains the top motivation for
overseas travel.”
“The
Chinese are by far the No. 1 shoppers in France…Last year, they
represented only 1.5 percent of foreign visitors, yet they spent
about €500 million ($621.5 million).”
From
personal experience and interaction with China/Hong Kong born
citizens travellers like to spend money on shopping. The general
consensus is that Chinese goods are risky to purchase because of
counterfeiting. Many feel much safer purchasing abroad for
well-known brands such as Gucci, Lious Vuitton, Gap, Ralph Lauren
Polo, Fred Perry etc. Particualrly fashion items such as belts,
handbags, jackets, trousers, dresses. Chinese enjoy food and culture
a lot more than other travellers. They like to taste the different
foods and like to adopt fashion style from abroad. I think they see
UK as very high-class and posh. They envisage tea parties in gardens
and really like the 'gentlemen' concept. There are several groups
that I have seen which affected this opinion:
Rich
parents who has brought their child to UK for private schooling in
boarding schools. Therefore, they take the opportunity of visiting
their children as a holiday and often like to spend a little money
each visit. These could be presents, or touristic travels and can be
considered special occasions. If the parent does not come to visit
their children, they will often travel back to China instead. These
will be during Holidays, so usually 3 times a year. If the students
are at university level, parents often send money to their children
and the students are pretty much free to spend it as they wish.
However, the emphasis is that in return, they should do well in their
studies.
For
domestic flights within China itself, we have the example of Mr.
Hyung as a businessman. (see my Week 6 post)
Talk
to target customers. Do they want your product? Will they pay? How
much?
I have personally
spoken to three regular travellers to China and Hong Kong; Janet,
Shiela, Magaret. Janet mostly goes to Hong Kong to visit family and
for holidays abroad.
Janet says the Kindle + membership will only
attract readers, and that it is not as appealing than iPads. She
argues that there are no games on the Kindle and she would rather
have a iPad as its much more fun. She uses an Emirantes airline
membership on her phone to collect airmiles, but she more often than
not uses a travel agent to purchase her flights. She says they are
cheaper and that the air miles are automatically added onto her
account. Plus, she enjoys the packages more as she is predominatly
in UK and like to go back to Hong Kong or China as a holiday package.
She enjoys packaged holidays that include hotels and coach rides to
pre-planned destinations. Therefore, our Kindle experience is not
suitable for her as she does not read much and feels that iPads will
keep her more entertained than a Kindle.
Shiela is a Jehova
witness and she is retired at roughly 50-60 years of age. She spends
most of her time volunteering in UK ans also in China. As a result
she travesl to and from UK a couple of times a year and collects many
air miles. Interestingly, she does not spend her miles and instead
her husband uses them instead, which he often spend on further
flights. These could be holidays or business. Shiela is a reader
and not really into playing games. She herself reads a lot for her
work and also carries books to and fro. She says likes phycical
books but is open to the Kindle. She says that if she had all her
books in a single device would help baggage when traveling. However,
she prefers physical book pages, and she also has to hand out books
every now and then. So she will always have some books on hand.
These include a periodical and some standard religious literature in
several languages.
Margaret really
enjoys the idea of a Kindle for travelling. She is also retired but
only at roughly 40 years of age. She has two children within UK
studying secondary and higher education. This means that for the
whole family, they live between Hong Kong and UK roughly 50:50 of the
year. She does not have a television in her UK home and is very
academic, which follows on to her children. Margaret and her
daughter share an iPad and use it mainly for games, e-mails and web
browsing. Seeing it, they have well over 40+ games/apps. She says
she does not like watching television because it is a waste of time,
and enjoys to read books as well as web browsing for information
gathering. Explaining the Kindle + Membership concept, she is keen
on it and can see it working. However, she is sceptical of how
popular it will be. She says that the iPad has a good battery life
and can offer the same benefits and more, but also agrees that it is
manily for games. A Kindle is suitable for readers only, but also
understands that the Kindle is much cheaper than the iPad. She
insists the Kindles would have to be free to be popular.
On a side note she
also enjoyed the idea of having Dim Sum on board of planes. We
discussed how it could work; a trolley that has shelves of a large
variety of dim sum. Then passengers can tell the steward which ones
they like, and then they would be picked with tongs onto a plate.
The idea is that not everyone likes the choices of food. This gives
flexibility for passengers and less packaging.
Brand
Issues
The Kindle
membership is very focused target, and can disuade many customers who
do not wish to use the Kindle. Therefore, I suggest we can have
different membership packages; They will essentially offer the same
services, but will be catered slightly differently.
“iPad membership”
- you can load up your E-ticket and save as a pdf to flip through as
you nagivate your travel. But more emphasis on games. E.g. land
your plane, manage your own airport, scrabble, poker, tetris with
other passengers etc. Anyone with an iPad can join up for this
membership.
“E-reader(Kindle)
membership” - load up your E-ticket, same as iPad. But this
membership will offer books services, such as rental books, or free
books in the airline library to download. Free newspapers for the
journey. Existing Kindle users can join up. Free Kindle for new
members? Or discounted branded kindle?
references:
