Low flights are all short flights. Flying on shorter

Low Fare: To generate demand in
the market Ryanair uses its low fare strategy, they target customers who are
looking for cheaper alternative (rail, road) to travel or businesses which want
limit their expenditure. 70% of Ryanair seats in every flight is sold at the
minimum rates after which price of the seats rise. They proud themselves of charging
surcharges of fuel to its customers. Their fares also depend on the demand that
a certain sector has and also on the gap between, when the flight tickets were
bought and the actual date of its departure.

Choice of Airports: Ryanair
flies to all secondary or regional airports most of which are not covered by
other airline companies. These airports are usually situated near big cities.
This strategy allows Ryanair to negotiate better deals with airports as Ryanair
gives these not so busy airports passenger footfalls and frequents flights.
Using of secondary airports also lets the company save costs on ground staff as
these airports don’t require many. As these regional and secondary airports do
not have much traffic it paves the way for Ryanair to have a faster turnaround
time. Which in turn increases the frequency of flights and ultimately the
turnover of the company.

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Short Point to Point Flights:
Ryanair flights are all point to point flights which would mean they do not
have indirect flights via major cities and usually these flights are all short
flights. Flying on shorter routes allows Ryanair to not provide services which
are expected in legacy carriers. Point to point flights also let Ryanair save
costs on ground staff who are needed for connecting flights/ airport
transfers. 

Operating costs: Among all airlines
companies in Europe Ryanair has one of the lowest operating cost. They have
been able to keep their costs low because of these reasons. Firstly they look
to purchase the same type/model of aircraft all the time. They have a fleet of
400+ aircrafts which are all Boeing 737-800’s. Boeing in return gives Ryanair
very reasonable prices which reduces their airplane procurement costs. This
also helps the company reduce its costs in training of its personnel, in
maintenance of its fleet and also in the storage of its spare parts. Secondly Ryanair’s
labor costs are very low as they try to hire and retain highly motivated and
efficient employees. They also provide incentives to its attendants in flights
for selling products during flights. They refrain from paying for overtime to
its employees as they tend to make sure none of their employees are working
more than the hours which are permitted by the government. Thirdly Ryanair
saves costs on customer services by hiring third party contactors to take care
of customers when not in flights. Their ground staff are all third party
employees. This helps them save costs on training which is done by the
contractors themselves. They also save on commissions that other airline
company’s pay to agents as 99% of their ticket sales is done on their website.
They use travel agents only when it is absolutely necessary. Lastly they save
cost on operations by focusing on the airports which provides them with the
best rates/ charges. With high number of passengers using Ryanair, they can
negotiate favorable deals at airports. First mover advantage is what Ryanair
usually benefits from at these airports which helps them become efficient and
low cost.

As mentioned above Ryanair has
been the leader in the European market among not only low cost carriers but
also amongst the legacy carriers. But not everything is perfect in Ryanair as
they have not been strategically very successful managing their brand
reputation. They have been known to have bad service culture which has
generated a lot of bad publicity for the company and has tarnished the
customer’s loyalty towards their company. Low cost strategy which has been the
hallmark of Ryanair’s success has been a major factor for it creating this bad reputation
in the market, as it takes extreme measures to cut costs rather than giving
customers value added services.

A research last year done by an
organization called Air Help which assists people with reimbursements when
there is a cancellation or a delay showed that Ryanair was amongst the worst
airline in the world (Ahluwalia, 2017). They have been
known to treat their customers in an appalling manner with people in Europe
calling it a nasty airline and saying that they treat their customers like
cattle. In 2015 they were fined by the anti-trust bodies in Italy for bad
customer service. They were found to run customer care lines at premium rates
but the problems of the customers rarely got solved (The Journal,
2015).

It’s not only the passengers who are complaining
Ryanair is also known to have high staff turnover rate which gives an
impression of it not being a good employer. Inadequate training, unattractive
remunerations and over burdening of work are some of the main reasons why
employees are leaving. They work on the method of hiring new ones employees.
This is not a permanent solution to the problem and their brand image is still
being harmed. It was seen in 2017 that lot of Ryanair pilots had resigned and gone
onto join a competitor (Smith, 2018). It was only in
December last year that Ryanair started recognizing trade unions to prevent pilots
from going into a strike during the festive period. Recently they decided hike
the salaries of pilots by 20% around all their bases