Ryanair's Cost Competitive In Its Industry

To what extent is it essential that ryanair operates at the lowest cost in its industry in order to be competitive in the mass market? (25 Marks)

Ryanair is an airline company which offers low cost tickets, in order to keep its ticket prices low ryanair must ensure its costs are low to be able to ensure it makes a profit. Ryanair’s ability to keep costs so low and offer cheap tickets allows the company to provide its product to the mass market, this is necessary in order for ryanair to be a successful company and remain profitable as its provides a cheap product therefore it relies on the fact that many customers will purchase tickets from ryanair.

Ryanair must ensure it keeps its costs low to be able to ensure its profit margins …show more content…
Therefore I think although keeping costs to a minimum is essential for Ryanair to be competitive in a mass market, Ryanair’s target market require low cost tickets in which Ryanair can only provide as long as its unit costs are low. This can be achieved through Porter's strategy of obtaining a cost leadership strategy and aiming to have lower costs than ryanair's airs rivals, if Ryanair is successful of having its costs lower than its rivals it can offer cheaper tickets than its rivals which makes it attractive to customers and therefore Ryanair's sales will be increased, initially boosting revenue and having a positive effect on profits. However Ryanair must ensure that through keeping its costs so low it ensure the itss level of quality is kept to a satisfactory standard ensuring customer needs are met and customers remain happy with a positive look on Ryanair which will help improve positive promotion of the company, this will in turn further help the brn=and image of Ryanair and increase its chances of success in the mass market through good advertising due to positive word of mouth