Trouble in the air for Virgin (airlines)

Citation

Benady, D. (2009), "Trouble in the air for Virgin (airlines)", Strategic Direction, Vol. 25 No. 3. https://doi.org/10.1108/sd.2009.05625cad.004

Trouble in the air for Virgin (airlines)

Article Type: Abstracts From: Strategic Direction, Volume 25, Issue 3

Benady D.Marketing Week, 16 October 2008, Start page: 20, No. of pages: 2

Purpose – assesses whether rapid change in the long-haul sector will plunge carrier Virgin Atlantic, which is approaching its 25th anniversary, into trouble. Design/methodology/approach – looks at the effects of alliances on Virgin Atlantic’s future. Findings – to mark its quarter century, Virgin Atlantic will be unveiling a major advertising campaign reminding customers of the unique position the brand occupies in the airline sector but, as the Open Skies deregulation of transatlantic flights takes hold, some are wondering whether the next 25 years will be as kind to the company. Comments on Virgin’s fierce opposition to British Airways’ attempt to tie up with American Airways, on BA’s proposed merger with Spain’s national carrier Iberia, on Virgin’s desire to buy British carrier BMI to get hold of its landing slots at Heathrow and on Virgin’s possible partnership with Lufthansa. Points out that, as a standalone airline, Virgin Atlantic does not reap the benefits of alliances accruing to rivals although some observers are confident that it can continue to thrive as a niche, upmarket player even in the face of consolidation and without the need to tie up with rivals and is impressed by the range of schemes launched by Virgin which seal the loyalty of customers. Originality/value – argues that what can keep Virgin Atlantic strong in the rapidly shifting airline market is the powerful franchise it has forged with its loyal customers, using innovation, marketing and the entertainment values borrowed from Virgin’s music business.ISSN: 0141-9285Reference: 37BA010

Keywords: Airline industry, Mergers and acquisitions