Business Model and Virgin Australia

Last Updated: 11 Sep 2020
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The company cannot achieve its goals until or unless it is able to understand the business it is operating in the work of the HR is not just hire and fire employees but understanding that they add value to the organization and thinks strategically. Employees here at virgin blue understand the value of this. Sources of Revenue The revenue that is generated by the domestic airline mainly come from the business sector as well as tourism which comprises of a 40% of domestic tourism where one goes to visit family and friends in the region while the business sector has a 35% share and the rest comes form the inbound tourism (Hogan, 2007).

Virgin Australia This is Virgin Blue’s new international sister airline. This will be using the internal resource of Virgin Blue as well of its own. Virgin Australia has added an international dimension to the Virgin airlines: it now travels to Los Angeles since February 2009. The Virgin Group is aggressively expanding in all directions whether national or international (Virgin Blue v Australia, 2009). Thus, Virgin Australia is truly an international airline, if we go by the definition while Virgin Blue operates profitably in the Asia-Pacific region complacently as a regional airline.

At the time of drafting this report, a price of $1095 was the price of a ticket from Australian cities of Melbourne, Sydney and Brisbane to Los Angeles (V Australia, 2009). The price of the ticket is a fair bargain and once again is a corroboration of the fact that the Virgin Group is primarily focused on low-cost jet-based services to its segment of loyal customers that is price sensitive and yet will want to stick to the Virgin group for its distinctive services. Opportunities and Success It was fortunate to enter the market at the time when Ansett failed and withdrew from the market in September 2001.

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This gave way to Virgin Blue to move forward in order to become the second biggest domestic airline of the country. Virgin Blue also got the access to the terminal space of Ansett which helped it to grow. It also hired more employees after the closure of Ansett. As the company grew it was able to buy new equipment and pay the lease of its former planes and bought modern glass cockpits and winglets (Ansett Crash Leaves Locals Burnt, 2009). Hindrance to strategic competitiveness The increased incident of terrorism acts all around the world has decreased tourism.

Moreover the global recession around the world has led to job cuts and sluggish growth which has further decreased the purchasing power of consumers and has made traveling expensive. The successful strategy of the company can attract competition and competitors can imitate them and this could mean that the company has to lose its competitive advantage. The emergence of Jet Star in 2004 and Tiger Airways in the year 2007 is a threat to the dominant position of the company. It can lose its market share; reap lesser revenues or profits. (Jetstar, Tiger and Virgin Blue... , 2008). Conclusion

With the inclusion of other competitive airlines in the industry, the survival of the fittest is going to apply here too. The company will have to analyze its competitive environment and identify the key factors that can have an impact on their strategy. They have been in the business from the past nine years now and they have seen growth and success through out. They have been able to draw and implement successful strategies under the effective leadership and cooperation from the employees they have. There internal culture gives the opportunity to the workforce to put in their best and perform (Hogan, 2007).

The company is strong in terms of surviving in the uncertain condition prevailing in the external environment and accepting challenges because these have not hit the profits of Virgin Blue too much. It has its own competitive advantages along with strong core values ingrained in the management of the company (Jetstar, Tiger and Virgin Blue helping to stimulate Melbourne - Gold Coast market to new level, 2008). Understanding the external and internal environment of a company is essential in order to plan ahead for the unforeseen circumstances that can occur and also it gives way for improvement and growth of the company.


  1. Ansett Crash Leaves Locals Burnt. (2009). Retrieved March 30, 2009, from EchoNews: http://www. echonews. com/737/index. html Breaking in a new culture: the Virgin Blue story. (2003, December 3).
  2. Retrieved March 31, 2009, from Human Resources Leader: http://www. humanresourcesmagazine. com. au/articles/0b/0c01a00b. asp Crozier, R. (2009, March 26).
  3. Inside Virgin Blue's IT Transformation. Retrieved March 31, 2009, from http://www. itnews. com. au/News/99644,inside-virgin-blue%E2%80%99s-it-transformation. aspx Hogan, J. (2007, February 21).
  4. Frills add substance for Virgin. Retrieved March 31, 2009, from The Age.
  5. com: http://www. theage. com. au/news/business/frills-add-substance-for-virgin/2007/02/20/1171733762942. html Information, A. I. (2004, April 23). Virgin Blue expects to withstand competition from Jetstar.
  6. Retrieved March 31, 2009, from BNet: http://findarticles. com/p/articles/mi_m0CWU/is_2004_April_23/ai_n5996248 Jetstar, Tiger and Virgin Blue helping to stimulate Melbourne - Gold Coast market to new level. (2008, December 12).
  7. Retrieved March 30, 2009, from http://www. anna. aero/2008/12/12/jetstar-tiger-and-virgin-blue-helping-to-stimulate-melbourne/ Major sales team expansion for Virgin Blue.
  8. (2005, October 3). Retrieved March 30, 2009, from www. asiatraveltips. com/news05/310-VirginBlue. shtml Qantas v. Virgin Blue. (2009). Retrieved March 31, 2009, from Frequent Flyer Community: www. frequentflyer. com. au/community/your-questions/qantas-vs-virgin-blue-5270. html V Australia. (2009).
  9. Retrieved March 31, 2009, from http://www. vaustralia. com. au/ Virgin Blue v Australia. (2009). Retrieved March 31, 2009, from http://www. virginblue. com. au/AboutUs/Media/NewsandPressReleases/index. htm Virgin Blue; About Us. (2009).
  10. Retrieved March 30, 2009, from Virgin Blue Home: http://www. virginblue. com. au/

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