Swot Analysis of It in Ryanair
RYANAIR by: Simon Schuster 08707031 BAHTM Since its beginnings in 1985, Ryanair has created a niche market for a ‘no frills’ airline based upon the model they adopted from Southwest Airlines. Ryanair is now the most popular (in terms of passenger traffic) low cost airline in Europe. Ryanair’s primary model is low cost and IT has been influential to this. Today, 99% of Ryanair passengers check-in online (the other 1% being a small number of self-check-in kiosks in Stansted) and the same ratio applies to sales, 99% of which are acquired through www. ryanair. om. We are going to conduct an analysis of the implementation of IT in their strategy. The analysis tool being used will be SWOT. Strengths One of the strengths Ryanair have with regards to IT is their website. It accounts for almost the entirety of their sales. As well as this it provides a wealth of data on where people travel? How often? How many bags? These are all instrumental pieces of information that help manage operation. Using this information will allow Ryanair to boost the accuracy how it distributes its fleet across their destinations.
Another use of this information would be how they control queues for passengers checking-in luggage as they would have the exact data from the online booking. As of August 2011, www. ryanair. com was the most visited airline website in Europe. This statistic shows that the website has a distinct advantage above their competitors in acquiring revenue from advertisements. As well as this, it shows a trend that travellers visit their site the most whether they go directly there or are referred to it because of their cheap prices.
Aside from their website, they operate a single model fleet comprising of 275 Boeing 737-800s. This makes repairs and diagnostics universal which allows them to use the same scale to track and monitor the performance and safety of their aircrafts. This again would considerably lower costs. Weaknesses Ryanair’s website has often come in for criticism because of its misleading prices. They regularly advertise ‘promotions’ or ‘offers’ at rock bottom prices, however they don’t include the related charges and ‘optional’ fees.
These charges and fees being, using any payment method other than Ryanair credit. Another possible weakness is their reluctance to adopt the mobile boarding pass. As many other airlines have this facility as another way to aid their customers’ experience, Ryanair seem to think less of it with Michael O’Leary saying “If you’ve printed out your piece of paper from the website, what does the mobile phone do for you? Nothing. ”. I can only presume this is because it will decrease the amount people being charged for the many fines Ryanair have in place for their customers.
A further weakness is the fact they have decided to charge €2. 99 to download their app for iPad and iPhone. This is in contrast to other airlines who released their apps well in advance of Ryanair but chose to offer it free to customers with similar or more functionality like the mobile boarding pass mentioned above. Opportunities Ryanair has many opportunities to grow through IT. Being the most visited airline website, advertising is a huge opportunity to gain revenue.
As well as this, it presents an opportunity to combine flights with other components of travel like hotels and car rental. They currently have a relationship with Hertz and also have a hotel booking function through www. ryanairhotels. com. As well as this they have relationships with other travel accommodation providers. There is an opportunity there to offer a package deal where customers will be able to purchase a holiday in full from Ryanair. This would be useful to customers as well as Ryanair.
Ryanair tested the use of mobile phones during flights which were received well by passengers as well as the airline themselves. However, they failed to reach an agreement with communications company OnAir. This is something that certainly will be the norm in years to come and I’m sure Ryanair would like to get there first as profits from high margin calls and texts could be lucrative. Because of a long relationship with Boeing, as well as using the same model planes across their fleet, Ryanair can provide Boeing with large amounts of valuable data.
Data that would help develop Boeings future models and in turn would provide improvements for Ryanair’s new planes. There is also a possibility Ryanair could install monitors on their planes that display sponsored advertisements for the duration of the flight. These ads could be related to the planes destination as well as Ryanair’s own adverts. Threats Ryanair’s biggest threat, among all airlines, is the rising price of fuel. Aside from this, they could face sanctions for their misleading adverts on their website.
Another threat of theirs is hackers, who could interrupt their website causing loss in revenue as well as customer dissatisfaction if online check-in was unavailable. An extreme case of this would be terrorists hacked into aviation authorities and caused an international threat. There is always the threat of more and more low cost airlines doing business, however even with others developing better apps and having higher standards of customer relations, Ryanair seem unfazed as they are ruthless in their low cost model and continue to be the cheapest. Summary
In conclusion, Ryanair’s IT strategy and how they implement it on their business is working well for them. The key asset being their website, through which almost all their revenue comes from. Even though competitors may have slight advantages in other IT components, Ryanair has the most efficient model and their brand as the ‘no frills’ airline is evidently the most recognisable across Europe. With a website with such high traffic and putting the majority of the pre-flight responsibility on the customer, it’s clear to see how they use IT to their advantage. References