Services and Marketing Relationship for Qantas - myassignmenthelp

Question: Discuss about theServices and Marketing Relationship for Qantas Airlines. Answer: Determinants of satisfaction/dissatisfaction at Qantas Service quality and good pricing are the main determinants of satisfaction/dissatisfaction in the airline industry. Satisfying customers is an important marketing activity as it has an impact of profitability of business and consumer purchase behavior. In case of Qantas airlines business organization, it is the worlds leading long distance airlines, which has built a reputation for safety, operational reliability and customer service. Qantas has reached a new level in customers satisfaction and the main determination of satisfied customers includes high class travel experience, quality of in-flight entertainment and pricing. Compared to other domestic airline in Australia, Qantas is ahead of Virgin in customer satisfaction. In terms of business travel experience, Qantas score was 84% and Virgins score was 75% in 2015. Qantas got 2014 Roy Morgan Customer Satisfaction Award for this achievement (Roy Morgan Research 2017). Another element for increasing customers satisfaction in the airline industry is the attributes related to airline service quality. Airline companies mainly aim to exceed customers satisfaction by improving the service quality to satisfy the needs of passengers. Service quality is the dimension of competitiveness. The service quality is affected by the expected service and service perceived by the consumers. This is also in relevance with the assimilation theory that states that cognitive process in a consumer determines the comparison between the expectations about the product and perceived product performance (David Mc 2013). Theoretical models have suggested different models for service quality. The three component model suggest service product, service delivery and service environment as critical for safety. Service quality and service satisfaction are interrelated aspects where a high level of service quality is associated with high level of customer satisfaction. For instance, the confirmation and the disconfirmation theory suggest that customers expectation about the service has a vital role in customer satisfaction. This expectation is also related to their beliefs about service delivery that is up to their standards or expectations (Pizam et al., 2016). Hence, customers expectation becomes the main reference for evaluating quality of service. Figure: Association between customers satisfaction and perceive performance Source: (Liu, et al. 2017). At Qantas, the quality of service is evaluated by giving ratings on the availability and standards of facilities, airlines responsiveness to address problems or challenges within the facility. Passenger perception survey is also conducted by Qantas to know about customers perception regarding coverage and level of satisfaction with facilities. This detail is also relevant with the above theories as it reflects that quality and customer satisfaction are interrelated (ACCC airport quality of service monitoring guideline 2017). Service recovery plan for Qantas Qantas has faced several challenges in its business due to external competitive challenges in the international airline industry. Some of the major challenges for them in the past year was related to industrial disputes, demand in working conditions and wages, impact on business due to weather events and natural disasters, 48 hour shut down, A380 mid-air engine failure, financial pressure due to fluctuating fuel prices and many other issues. Hence, a comprehensive service recovery plan is needed to deal with such issues and be prepared to smartly handle challenges in business. Such service recovery effort is mainly followed after experiencing failure in service or part of service. This influences the organization to put strategies in place to retain customers satisfaction as well as maintain profitability in business. It can also be said that service recovery approach is the pathway to customer loyalty and responding to customer complaint. This approach is also relevant to the justic e theory, which evolved over time to include the dimension of distributive, procedural and interactional justice. Distributive justice was related to the process by which key goals were achieved, whereas procedural justice and interactional justice was related to manner in which key plans are delivered (Tan 2014). This method ultimately has an impact on service recovery satisfaction. In case of Qantas, the three dimensions of justice theory will be useful in devising service recovery plan. Figure 2: Different dimensions of justice. Source: (Ghaziani et al. 2012) The service recovery plan for Qantas in response to their failure as follows: Both Qantas and Virgin Australia were under pressure to abolish fuel charges after the decline in oil prices in 2014-2015. In response to the impact on business due to fluctuating fuel prices, Qantas can address these issues in the future by fuel hedging process. Different financial instrument can used to address the risk related to currency fluctuation and volatility of fuel prices (Merkert 2015). To ensure distributive justice and build a stronger Qantas, there is a need to be economically sustainable too. This is because Qantas face many structural challenges due to the deregulation of market and risk in new fleet of airlines. The plan is to utilize their strength to open gateway to the world and create a shareholder value by building a strong and viable business. Working with effective partners will also be important to establish connection with large number of customers (Wen and Geng-qing Chi 2013). Reference ACCC airport quality of service monitoring guideline. 2017. Retrieved 25 September 2017, from https://www.accc.gov.au/system/files/Draft%20Airport%20quality%20of%20service%20monitoring%20guideline%E2%80%94statement%20of%20reasons.pdf David Mc A, B. (2013). Service quality and customer satisfaction in the airline industry: A comparison between legacy airlines and low-cost airlines.American Journal of Tourism Research,2(1), 67-77. Ghaziani, F.G., Safania, A. and Tayebi, S.M., 2012. Impact of Organizational Justice Perceptions on Job Satisfaction and Organizational Commitment: the Irans Ministry of Sport Perspective.Australian Journal of Basic and Applied Sciences,6(7), pp.179-188.Liu, Y., Dong, D., Burnkant, R. (2017).Provide Consumers with What They Want on Word of Mouth Forums. Retrieved 25 September 2017, from https://file.scirp.org/Html/3-8601288_29340.htm Merkert, R. 2015. Retrieved 25 September 2017, from https://theconversation.com/explainer-fuel-hedging-and-its-impact-on-airlines-and-airfares-36773 Pizam, A., Pizam, A., Shapoval, V., Shapoval, V., Ellis, T., Ellis, T. (2016). Customer satisfaction and its measurement in hospitality enterprises: a revisit and update.International Journal of Contemporary Hospitality Management,28(1), 2-35. Roy Morgan Research 2017. Retrieved 23 September 2017, from https://www.roymorgan.com/findings/6208-qantas-reaches-new-high-in-customer-satisfaction-201504270141 Tan, T.A.G., 2014. Effects of Justice Theory on Service Recovery Satisfaction on Metro Manila Dine-in Experiences.Philippine Management Review,21. Wen, B. and Geng-qing Chi, C., 2013. Examine the cognitive and affective antecedents to service recovery satisfaction: A field study of delayed airline passengers.International Journal of Contemporary Hospitality Management,25(3), pp.306-327.