BIBLIOGRAPHY

Economy Environment [online]. Available from:
http://sites.google.com/site/theeconomicenviroment/easy-jet-demand

Annual Report [online]. Available from:
http://2009annualreport.easyjet.com/

EasyJet [online]. Available from:
http://www.easy.com/

Airlines [online]. Available from:
http://www.ft.com/

EasyJet Model [online]. Available from:
http://www.aatl.net/publications/easyjetmodel.htm

British Council [online]. Available from:
http://www.britishcouncil.org/new/

Vertical and Horizontal Integration [online]. Available from:
http://www.123helpme.com/meaning-of-vertical-and-horizontal-integration-view.asp?id=150321

EU [online]. Avaliable from:
http://europa.eu/index_en.htm

Hospitality News [online]. Available from:
http://ehotelier.com/hospitality-news/item.php?id=A1447_0_11_0_M

Mission Statement [online]. Available from:
http://www.slideshare.net/esteewu/easyjet-presentation

EASYJET

CUSTOMER AND MARKET

Develop a winning customer proposition

easyJet’s network, great schedule and industry-leading distribution via easyJet.com appeals to a broad base of both business and leisure customers. The easyJet brand has pan-European reach and appeal throughout 27 countries. New initiatives are continuing to strengthen our position as both a leading airline and an innovative e-commerce business.

Understanding our customers

 

We work hard to get close to our customers, listening to their needs and evolving our schedule and services to match. During the year, we aggregated all our customer data into a single location to give us a fast and intelligent view on emerging trends in customer travelling habits.
easyJet is leading the way within the airline industry on its use of social media to drive customer engagement and improve the customer experience – since its launch six months ago, @easyJetcare on Twitter has proactively assisted thousands of customers. easyJet also developed the first airline iPhone application in Europe, providing customers with real time data on the arrivals and departures for flights to and from our Swiss airports.
Ensuring that our customers arrive at their destination on time is key to delivery of a winning customer proposition, and at easyJet we continually measure on time performance. In the year, our on time performance (measured as percentage of flights arriving within 15 minutes of scheduled arrival time) improved from 75.4% to 79.5%.
The result? Continued strong appeal across the four key customer groups: business people; holidaymakers; customers visiting friends and relatives; and second home owners. In fact, nearly 90% of customers surveyed during the year would recommend easyJet to a friend.

Improving our communications

The better we understand our customers, the more accurately we can target our communications. For example, with our new customer database in place, we are now able to tailor marketing emails to reflect the purchasing patterns and preferences of individual customers.

To support a renewed focus on business travel, we launched an online campaign targeted at finance directors. “Keep the FD happy” is an interactive video that takes a light-hearted look at how easyJet can save a company money in these tough times – but also highlights the serious business benefits of flying with easyJet, such as no weight restrictions on hand baggage and the ability to book through their preferred travel management channel. See the campaign at http://www.keepthefdhappy.com/

Our iconic Objects campaign continues to run across Europe, adapted to the needs of different markets. The campaign uses iconic orange “Objects” to represent the destinations to which we fly or the type of trip customers are taking. It delivers an energetic, exciting evocation of the travel possibilities we provide and a clear focus on the low price of the flight. Each easyJet campaign runs across a broad variety of both online and offline media.
Our public stance on climate change, such as signing the Copenhagen Communiqué, sends out an important message. Environmental matters are important to us, as they are to our customers. We have integrated a carbon calculator and offsetting facility into our online reservation system, with all investments made exclusively in United Nations-certified offset projects. Since the scheme was launched, easyJet customers have to date offset over 194 million Kg of CO₂.

 

Enhancing easyJet.com

 

As the UK’s most visited airline site, easyJet.com remains our primary distribution channel and in the last year we have commenced a major rebuild and refresh. We consulted with our customers, identifying what was and what was not liked about the existing site, and also looked at a wide range of top sites, both inside and outside the travel sector.
We have concentrated our initial energy on the most important section: the booking funnel, where five pages are responsible for delivering around £2 billion in revenue. The site is built on a more robust and scalable platform and is even easier to use, with a wider template and a basket that is visible at all times.

Building our appeal to business travellers

 

In a tough economic environment, we have increased our share of the business travel market in the past year. We recognise that the business travel segment, where revenue per seat can be around 20% higher than average, has different booking requirements to other markets. In particular, large corporates have strict travel management policies in place and manage their travel requirements through agents who often book through the industry’s Global Distribution Systems (GDS) such as Amadeus and Galileo.
Last year we made our schedule available via the GDS and other aggregator systems, so we are now listed in agents’ search results alongside other carriers. By the end of the year, around 15% of business seats were already being booked through this channel.
Business travellers, as well as leisure customers, are also benefiting from our winning customer experience initiatives. These include the ability to check in online up to 60 days before a flight, the opportunity to take an earlier flight for free, an inflight magazine that is as good a read as it is a promotional tool, and regionalised food and drink menus. Speedy Boarding remains an attractive customer proposition and we have been working hard to improve delivery across the network. In addition, this was the first full year for easyJet Plus!, an annual Speedy Boarding pass. With over 20,000 members across Europe, the card has quickly become a popular feature with easyJet’s frequent travellers

Portfolio Task 6

TECHNOLOGICAL FACTORS

• competing technology development
• research funding
• associated/dependent technologies
• replacement technology/solutions
• maturity of technology
• manufacturing maturity and capacity
• information and communications
• consumer buying mechanisms/technology
• technology legislation
• innovation potential
• technology access, licencing, patents
• intellectual property issues
• global communications

The “easyJet ecoJet”: to cut CO2 emissions by 50% by 2015

The “easyJet ecoJet”: to cut CO2 emissions by 50% by 2015

easyJet has today become the first airline to outline the environmental requirements that must be met by the next generation of short-haul super-clean aircraft; and unveiled its design of what such an aircraft could look like for operation by 2015.

Dubbed the “easyJet ecoJet”, the aircraft would need to be 25% quieter and would emit 50% less CO2 and 75% less NOx than today’s newest aircraft (the 737 and A320 families of aircraft).

The aircraft will incorporate the latest research by airframe and engine manufacturers around the world – all of which can be incorporated into an aircraft that should be in operation by 2015. The projection for the 50% CO2 reduction is based on the findings from the latest research by the industry leaders and will come from the engines (25%), the lightweight airframe (15%) and from improvements to air traffic control technology and design (10%).

In easyJet’s current configuration and operation, the projection for the eco-liner would generate less than 47g of CO2 per passenger km. For comparison, easyJet’s current operations generate 97.5g of CO2 per passenger km, the Toyota Prius emits 104g of CO2 per kilometre; and the European car industry has recently been given a target to achieve 130g of CO2 per kilometre.

The design will contain a number of key features to make it radically more environmentally efficient:

• Rear-mounted “open-rotor” engines offer unrivalled environmental performance for short-haul flying due to their higher propulsive efficiency. However, there are significant difficulties in fixing such a large engine under a wing of a narrow-body aircraft, making rear-mounting of the engines the optimum solution
• A lower design cruise speed to reduce drag and a shorter design range to reduce weight
• Noise reductions are expected to come from a gear box between the engine and the open-rotor blades keeping them subsonic during take-off and landing, the use of the rear empennage to shield the ground from engine noise, and airframe improvements (such as no slats on the front of the wing)
• The airframe will be made of advanced weight-reducing materials similar to those used in current projects like the Boeing 787, which itself is estimated to be 27% more fuel efficient than the aircraft it will replace in many fleets

Even as global demand for air travel matures over time, several step-changes in technology will be needed to reduce the emissions from aviation in 2050 to below 2005 levels. The “easyJet ecoJet” will be the first of these step changes and alone could lead to a stabilisation of emissions from short-haul aviation at 2005 levels until 2035 providing massive environmental benefits.

Speaking at a press conference to unveil the “easyJet ecoJet”, Andy Harrison, easyJet Chief Executive, said:

“The aviation industry has an excellent record in reducing the environmental footprint of aircraft. Today’s aircraft are typically 70% cleaner and 75% quieter than their 1960s counterparts. Now we are planning the next generation that will help towards taking the plane out of the emissions equation.

“easyJet is already setting the environmental standard in the airline industry. Our fleet of 131 aircraft has an average age of only 2.3 years – the youngest of any major airline in Europe. We have recently called for over 700 of the dirtiest aircraft to be banned from Europe’s skies and are active supporters of the EU’s Emissions Trading Scheme and Single European Skies programme.

“The aircraft example we have unveiled today represents the next major step forward in airframe and engine technology. The lightweight structure and open-rotor engines are based on technologies that are being developed right now by the major manufacturers. The “easyJet ecoJet” is realistic and it is achievable. If the “easyJet ecoJet” were to be made available today we would order hundreds them for fleet replacement and to achieve the ‘green growth’ that our industry has committed to.”

ASH DETEDTION TECHNOLOGY

Technology that allows aircraft to measure volcanic ash concentrations so they can steer clear of dangerous clouds in mid-flight has been successfully tested by EasyJet.

The system used by the low-cost carrier could improve the mapping of ash clouds, helping regulators avoid shutting down large swathes of commercial airspace in response to volcanic eruptions.

On the Web

easyJet has based its ticket sales on the Web. At present, over 75 per cent of its sales are sold directly through the website. This is all the more remarkable, given known consumer hesitation about buying anything online.
When booking a flight, the passenger is not only offered a choice of flights, but also the best fare available on each flight. Moreover, not only are the offered fares lower than those of the competition, but they can sometimes seem ridiculously lower.
Fares are quoted one way, which means that the best price for the most convenient flight can be obtained both ways, optimising the round-trip cost for the passenger. This approach compares very favourably with the inflexible pricing and ticketing structures that are offered by conventional airlines, and further reductions are offered for flights that are booked on the Web.

Online Experience

The passenger's online experience reinforces confidence in the booking process. A five-step approach is taken, allowing the passenger to exit at any time. The booking form remembers essential passenger information, so irritating re-entering of basic details is not necessary if passengers want to experiment with dates and times. It will also remember these details from one booking session to the next for registered users, speeding up the whole process for the customer.
Once a passenger has booked their ticket for the first time, they can directly influence the ticket price, and choices are offered to them that are not available elsewhere. As a result, there seems little doubt that easyJet's customers enjoy their online experience, so ensuring that they come back regularly and often.

Web Strategy

The company is so confident in its Web strategy, that it is now seems ready to take the next step in this process and become the first 'Web-only' airline, completely doing away with telesales (something already achieved by easyRentacar). Its aircraft no longer carry the telephone booking reservation number, but only its website address.
easyJet maintains its confidence in this approach, based on the real and dramatic growth in Web sales. The fact that this Web-only approach is possible is a reflection of the way that consumer attitudes have developed over the last decade, and the fact that the Internet and mobile telecommunications technology have increasingly become integrated into everyday life.

Portfolio task 3

MAIN ECONOMIC FACTORS

- Fuel Prices and Hedging

- US Dollar and Euro Exchange Rates

- Currency Impact

- Financial Measures

- Airport Charges

- Financial Measures

- Reduction in Aircraft Utilisation

FUEL PRICES AND HEDGING

Total fuel cost amounted to £807.2 million in 2009, an increase of 13.9% compared to 2008, equating to a cost per seat of £15.28, up £1.63 per seat or 11.9%. The average market price for jet fuel during 2009 was $595 per metric tonne (excluding fees and taxes) compared to $1,070 in 2008, driven by the extraordinary spike in fuel prices during that year. However, after taking account of hedging taken out in 2008 during the period of high fuel prices, easyJet’s effective price for 2009 was $951 per metric tonne compared to $948 in 2008.
With the effective US dollar price broadly flat for 2009 compared to 2008, the increase in fuel cost per seat is largely driven by the strengthening of the US dollar against sterling, partly mitigated by US dollar hedging.
Despite the introduction of additional heavier A320 aircraft into the fleet and an increase in the average load factor of 1.4ppt, average fuel burn for the year was 715 US gallons per block hour compared to 717 in 2008, principally reflecting the implementation of fuel conservation initiatives.

US DOLLAR AND EURO EXCHANGE RATES

The market rate for the US dollar strengthened by 22% from an average rate of 1.99/£ in 2008 to 1.56/£ in 2009; after taking account of hedging, easyJet’s effective rate strengthened from an average of 1.96/£ in 2008 to 1.78/£ in 2009. The business has no US dollar revenues but significant US dollar costs for fuel, aircraft leases, maintenance and some loan interest and consequently the 9% movement in the effective dollar rate had a significant impact on financial performance.
The euro has strengthened by 12% from an average rate of 1.32/£ in 2008 to 1.16/£ in 2009. Approximately 42% of revenues and 31% of costs (principally ground handling, airport and navigation charges and some crew costs) are denominated in euro resulting in a net long position; the strengthening of the euro, therefore, delivers a positive impact to the results. For the first time this year some hedging of the euro surplus has also been undertaken.

CURRENCY IMPACT

The following charts illustrate easyJet’s exposure to foreign currency revenues and costs:

Certain key measures are therefore significantly impacted by exchange rate fluctuations.

COMPANY OR

Safety is our No.1 priority and a clear imperative for every airline, including easyJet. We recognise the risks associated with operating an airline and work tirelessly to ensure the safety of our customers, our people and our shareholders’ investments.
At easyJet we believe people make the difference; by treating our people well, they will be more customer-focused and better represent the easyJet brand – and that in turn will drive greater customer satisfaction.
In order for aviation to have a long-term future, we must minimise our environmental impact, ensure that environmental impacts and the evolving regulatory environment are considered in all key business decisions and continue to invest in a fleet of young and fuel-efficient aircraft.

Safety and our customer proposition are key strategic priorities and are covered in detail here and here of this publication and therefore this Corporate Responsibility report focuses on our approach to people and environmental management.

People

Our business is only as good as the people that we recruit, train and retain. Our people strategy is underpinned by the cornerstones of talent, engagement and organisational design and aims to ensure that, through strong leadership, we have the right skills in the right place at the right time, thereby creating an environment where people perform better for us than they would for anyone else. We recognise that having the right skills, experience and culture directly influences our performance across all of our strategic objectives. Our ethos is expressed through five values: safety (our No.1 priority – no compromises), teamwork (we’ll get there faster together), pioneering (breaking the mould to find new ways and new opportunities), passionate (we’re ambitious to be the best we can be) and integrity (we mean what we say, and do it!).

Recruitment

Our employer brand remains a key strength – we received over 45,000 hits on our website for opportunities which resulted in over 20,000 applications; the quality of these applications was high and continues to ensure that we have buoyant holding pools from which to source our future employees.

We continue to focus on recruiting crew that live and breathe our values and have, for the past few years, changed the emphasis of our employment model to match the seasonal peaks of our business. We recruited 672 cabin crew in the year; our strategy to employ on fixed term contracts and invite people back year after year enables us to manage our business flexibly whilst maintaining our high standard of operation. We also operated the Flexicrew scheme for our pilot requirements, employing 92 pilots across seven bases for fixed periods of time, to meet our operational needs.

Following the consolidation of easyTech and GB into the easyJet engineering and maintenance function, our focus has been on integration and building talent for our future growth. We have recruited 28 people into the function this year following the in-sourcing of several activities previously undertaken by a third party supplier. This exercise has enabled us to manage the safety, oversight, availability and reliability of the ever growing fleet. This has been another positive step forward in ensuring a world-class operation and a fully integrated engineering and maintenance function.

Training

A wide variety of people joined easyJet through the year. We have looked to continuously improve our well-established and thorough induction training programme for crew and are in the process of refreshing our offering for those within the Management and Administration (M&A) population. This will ensure that all of our new joiners understand the easyJet culture, what we value, our strategic objectives and how they can contribute to our success from day one. easyJet wants people who are new to the organisation to settle in as quickly and efficiently as possible and will continue to invest in the induction process for everyone’s benefit.

We continue to partner with leading schools such as Cranfield University and London City University to ensure our managers get high quality support in developing both their technical and management skills. We continue to build and maintain good relationships with well regarded research and advisory organisations and many of our senior managers continue to represent easyJet at numerous external events hosted by these leading organisations.

Retention

easyJet targets a sensible balance of retention and attrition, benefiting from our investment in recruitment and training, combined with continual injection of fresh thinking. Retention rates are influenced by rewards (including pay, benefits and career development opportunities) and employee engagement.

We recognise that it is often beneficial to the business to identify and develop talent internally together with recruiting externally. Four years ago, we developed our talent identification and succession planning process, which is now embedded in our organisation. As a result, we are more effective at identifying and retaining a pool of talent internally on which we can draw as key roles become vacant or new roles are created. Consequently, whilst we have experienced higher than normal turnover among senior managers this year, we have been able to source some replacements from within our talent pool whilst also taking the opportunity to refresh our talent mix from outside. Overall unforced staff turnover has improved by 5.1 percentage points to 6.9% since 2008, although understandably, the tough economic environment may have also significantly influenced employees’ decision to stay at easyJet.

Turning Europe Orange

In line with our quest to “Turn Europe Orange” we have made significant progress in expanding our employer presence across Europe. In 2009, easyJet continued to grow its employee base in Italy, Spain and France, strengthening our position as a truly pan-European air transport network.

As at 30 September 2009, easyJet employed 6,666 people (2008: 6,107), based throughout Europe as illustrated below:

United Kingdom	4,473
Switzerland	498
France	435
Spain	432
Italy	521
Germany	307
Total	6,666

Portfolie task 5

5 MAJOR SOCIAL AND CULTURAL TREDS

CULTURAL AND SOCIAL TRENDS REFLECTED IN CHANGING PATTERNS OF CONSUMPTION FOR THL PRODUCTS AND SERVICES

POPULATION - Growth of THL
EDUCATION - Higher demands on product and service
EMPLOYMENT - Selection of destination, service, product
INCOME & WEALTH - Selection of destiona, service, product base on what people can afford
EXPENDITURE - Price of product, size of companies (hotels,airlines, travel agencies), amout of services provided

POP CULTURE - Destination where people travel
TECHNOLOGY - Higher quality of products, quicker services
HEALTH LIFE STYLE - Selection of active holidays
CREATIVITY - Better and original products and services
LIVING - Selection of better products and accommodation

'AGEING' POPULATION

The process of growing old or developing the appearance and characteristics of old age

CONSEQUENCES FOR THE TOURISM SECTOR

- There is likely to be an increasing division between time-rich and money-rich markets for tourism. These currently retiring on good pensions generally have no time constraints on their ability to travel - a fact which creates more opportunities for the development of off-season products. But for many of working age, the growing shortage of leisure time means that they are increasingly willing to spend money in order to save time. This is creating a growing demand for special services and more convenience in shopping and purchasing services.
- The ageing population and an increasing concern for health are likely to drive a growth in demand for health tourism products and spa services. There should also be growing interest in cultural tourism and specially designed programmes for the older traveller.

Laws in tourism and hospitality

1) FOOD SAFETY ACT 1990

2) TRADE DESCRIPTION ACT 1968

3) HOTEL PROPRIETORS ACT 1956

4) HEALTH AND SAFETY AT WORK ACT 1974

5) PACKAGE TOURS REGULATIONS ACT 1992

6) WAGES ACT 1986

7) EMPLOYMENT ACT 2008

8) DATE PROTECTION ACT 1998

9) CONSUMER PROTECTION ACT 1987

10) SALES OF GOODS ACT 1979

Enlargement of the European Union

The Enlargement of the European Union will help create a ''more complete and coherent European tourism industry, which should be recognized in the future European Constitution'' according to the World Tourism Organization.

''With the fall of political borders and increased awareness of tourism products in the new Members of the 'EU family', we may expect an increase in East-Western European tourism flows and vice-versa, ''says the WTO Secretary-General Francesco Frangialli. ''The new countries are not juct destinations, but tourism-generating markets as well.''

It reveals that Europe is a very stable tourist destination compared to other large regions in the world. The enlargement process contributed to this by inducing international arrivals not only in the new Member States, but also between old and new Memeber States. The still existing gaps in income and the differences in travel habits open a tremedous number of business opportunities and offer incentives to improve competitiveness.

EURO currency

ADVANTAGES

1) Transaction Costs Will be Eliminated
2) Price Transparency
3) Uncertainty Caused by Exchange Rate Fluctuations Eliminated
4) Single Curency in Single Market Makes Sense
5) Rival to The ''Big Two'': If we look out in the world today we can see strong currencies such as the Japanese Yen an The American $. America and Japan both have strong economies and have milions of inhabitants. A newly found monetary union and a new curreny in Europe could be a rival to the ''BIG TWO''.
6) Prevent War: The EMU is, and will be a political project. It's founding is a step towards European integration, to prevent war.
7) Increased Trade and Reduced Costs to Firms
8) The Political Agenda: There is a political agenda to European bank (the European System of Central Banks - ESCB), the complete removal of national control over monetary policy and the partial removal of control over fiscal policy.
9) Inflation

DISADVANTAGES

1) The Instability of the System
2) Over Estimation of Trade Benefits
3) Loss of Sovereignty
4) Deflationary Tendencies

Members of European Union

Member states of the EU

(year of entry)

1. Austria (1995)
2. Belgium (1952)
3. Bulgaria (2007)
4. Cyprus (2004)
5. Czech Republic (2004)
6. Denmark (1973)
7. Estonia (2004)
8. Finland (1995)
9. France (1952)
10. Germany (1952)
11. Greece (1981)
12. Hungary (2004)
13. Ireland (1973)
14. Italy (1952)
15. Latvia (2004)
16. Lithuania (2004)
17. Luxembourg (1952)
18. Malta (2004)
19. Netherlands (1952)
20. Poland (2004)
21. Portugal (1986)
22. Romania (2007)
23. Slovakia (2004)
24. Slovenia (2004)
25. Spain (1986)
26. Sweden (1995)
27. United Kingdom (1973)

Candidate countries

• Croatia
• Former Yugoslav Republic of Macedonia
• Iceland
• Montenegro
• Turkey

Other European countries

• Albania
• Andorra
• Armenia
• Azerbaijan
• Belarus
• Bosnia and Herzegovina
• Georgia
• Liechtenstein
• Moldova
• Monaco
• Norway
• Russia
• San Marino
• Serbia

• Switzerland
• Ukraine
• Vatican City State