European Airline Industry Essay
Threat of substitutes
• Alternative transport (bus, car, train) ^
• Videoconferencing ^
• Global environmental awareness ^
The threat of substitutes includes a broad variety for the different needs. All-in-all it still only gives a medium threat, since the quick transport to a distance has no alternative.
Bargaining power of customers
• Price ˇ
• Internet/social media ^
• Customer orientation ˇ
• Choice ^
With the first LCCs the customers had no bargaining power: if you choose to go with this low price, accept the services as it is. However, nowadays with more alternatives and the ever-reaching internet and social media a bad customer satisfaction can be a disaster. This can however be mitigated with customer orientation, but still customer had the choice, it is a medium high level.
Rivalry within the industry
• Between LCC and national/network airlines ^
• Between LCCs ^
The rivalry within the industry is high due to the high number of big and