Monetising

The main approach we believe that will be the most effective for Virgin Atlantic would be to introduce a freemium game. A freemium game is a mix of both free and premium. This is a strategy where customers can access a basic version of a product or service for free, they then have the option to change to a premium version which offers additional features by paying a price (Gu, Kannan, Ma, 2018). An example of one company which offers a freemium service is Fortnite, they offer their users the ability to play the game for free, the payment is only used for character extensions (i.e. outfits). Fortnite accumulated $223 million in revenue amongst all their platforms (Business Insider, 2018). With most freemium based games, the developers set out limitations within the game so that friction increase with free users to that it encourages them to pay for the premium (Hubspot, 2018). The limitations which would be in place would be:

The Difference

Virgin Atlantics new game will feature the chances to win exciting offers such as half price on selected soft drinks or collect a free snack on your next VA flight. The reason for the introduction of special offers and discounts is so that they gain a competitive advantage. The Huffington Post reported that 51% of participants agreed that were influenced by deals, discounts or sales when shopping online (Huffington Post, 2016).

Communication

Virgin Atlantic already use numerous methods of communication channels to communicate with consumers. These include email marketing, social media and TV advertisements. Virgin Atlantic should use channels such as their app, on-flight poster ads and email marketing to promote their new initiative. The reason for this choice is due to the low cost associated with promoting their initiative through these channels.

When communicating this initiative, it is important that Virgin Atlantic use the AIDA model (Awareness, Interest, Desire and Action) in the delivery of their communication. This is important if Virgin Atlantic want an effective message of communication as it helps persuade the buyer towards making their purchase decision.

SmartInsights, 2013

Associated Risks

One major risk which can be associated with this is ensuring that the game has the ‘fun factor’. The producers of any game must consider that its only about the delivery of a strong creative product but to create a product that the audience will want to play (Schmalz, Finn, Taylor, 2014). ‘Fun’ is deemed as an ephemeral trait, this means that it is challenging to find an audience that will enjoy the game to its full potential (Schmalz, Finn, Taylor, 2014).

Another risk with creating a mobile game would be within the development strategy. These could include problems such as incorrectly prioritising work, implementing an inefficient project structure, failure to allocate time for quality assurance, and insufficient prototyping before production (Schmalz, Finn, Taylor, 2014). This can be a big risk for Virgin as they may find that if these risks are not dealt with from early then this could heavily impact the release of the game.

Another risk associated with this initiative is the challenge of using a freemium strategy. There is a threshold with freemium strategies between attracting a large user base and then generating increased levels of a direct network effect, while users are still upgrading to premium (Hennig-Thurau & Marchand, 2013). Wu, Chen, and Cho (2013) argued that giving away games for free can maximise revenues if the positive network effects of the game are high and then the negative effects of the game’s limitations are low.

References 

Cox, J. (2018). The Ultimate Guide to Freemium. [online] Blog.hubspot.com. Available at: https://blog.hubspot.com/service/freemium

Gu, X., Kannan, P. and Ma, L. (2018). Selling the Premium in Freemium. Journal of Marketing, 82(6), pp.10-27.

Hennig-Thurau, T. and Marchand, A. (2013). Value Creation in the Video Game Industry: Industry Economics, Consumer Benefits, and Research Opportunities. Journal of Interactive Marketing, [online] 27, pp.141-1587. Available at: https://www.marketingcenter.de/sites/mcm/files/downloads/research/lmm/literature/marchand_hennig-thurau_2013_jim_value_creation_in_the_video_game_industry_industry_economics_consumer_benefits_and_research_opportunities.pdf

HuffPost. (2015). What Science Says About Discounts, Promotions and Free Offers. [online] Available at: https://www.huffingtonpost.com/danny-wong/what-science-says-about-discounts_b_8511224.html.

markets.businessinsider.com. (2018). Fortnite is following the blueprint of the most profitable video game of all time (TTWO) | Markets Insider. [online] Available at: https://markets.businessinsider.com/news/stocks/fortnite-copies-most-profitable-game-gta-2018-5-1025067183.

Schmalz, M., Finn, A. and Taylor, H. (2014). Risk Management in Video Game Development Projects. [ebook] Waikoloa: IEEE. Available at: https://ieeexplore.ieee.org/document/6759136.

Wu, Chi-Cheng, Ying-Ju. Chen, and Yung-Jan Cho (2013), “Nested Network Effects in Online Free Games with Accessory Selling,” Journal of Interactive Marketing, 27, 3, 158–71.

Virgin Atlantic’s Critical Analysis

Jack Cowdrey

Virgin Atlantic was founded in 1984 to be a high quality and good value for money airline. While this was a difficult environment for Virgin Atlantic to develop, they still became the first to offer individual TV for business class.

Virgin Atlantics Websites Role

Virgin Atlantic websites main key role as a service orientated function to it. Customers come onto their website to find prices and times for flights to their desired destination. They do this by offering a range of services such as Economy Class, Business Class or First Class. They go further than this by offering their customers Flights + Hotels, Hotels and just car rental. However, their website can be used as relationship building as they create blogs for users. They have done this as a type of Brand Building as they want to use the blogs to help their customers.

Virgin Atlantics Competitors

Virgin Atlantic’s main competitors would be Emirates and British Airways. These two would be their closely matched competitors as they all offer a high quality of service. When benchmarking the companies together it is clear what the key differences are between these companies. While all these companies are service orientated, they are very different in their own way. Virgin Atlantic is the only one out of the chosen competitors which offers its customers a Virgin Atlantic Blog. They have subcategorized their blogs under; our aircraft, our places, our people, our style and our future. This helps build relationships between the customer and the business as it allows customers to get insight into the world the Virgin Atlantic. While British Airways and Emirates both have exceptional websites, they have don’t have their own blog page.

Targeting and Segmentation

The type of customers which Virgin Atlantic target are those who describe themselves as ‘Mavericks, Adventurous and pioneering’ these are referred to by Virgin Atlantic as ‘Fearless Leaders’ (Inc, 2013). Virgin Atlantic have used their skills to appeal to these types of customers by introducing onboard bars, nail salons and get a massage. Virgin Atlantic also ran a campaign with the hashtag as; #FITFOO, this was labelled as ‘Flying in the Face of Ordinary’. This campaign needed its customers to boast about how good it is using Virgin Atlantic. The idea of this campaign was to make other airline passengers jealous of the experience that their customers were receiving from Virgin Atlantic. Virgin Atlantic has been known to target customers who tend to be business travellers (MarketingWeek, 2015).  

Customer Personas

After looking at Virgin Atlantics segmentation it is clear to see that they are targeting people from predominantly from the middle class or upper class. This is proven as most of their packages have been luxurious services such as booking a chauffeur to help transport you from your house to the airport and then from the airport to your desired destination i.e. hotel or villa. Virgin Atlantic are actively looking for ‘passionate’ experience seekers and those with ‘can-do attitude’ (MarketingWeek, 2015).

 Customer Journey

Looking at the Appendix / you can see the different points at which the key personas had a change of mind. One key point to look at would be when Trevor compares the prices to the competitors. This could be down to Trevor’s job being less well paid as Sarah, so this means that he will have to check other airlines prices as he is more price sensitive. You can also see on the post-engagement that Trevor has read the airlines promotional material, this again could be to ensure that he finds the best deal possible available to him.

References:

Inc.com. (2018). How Virgin Atlantic’s Marketing Nails It. [online] Available at: https://www.inc.com/janine-popick/how-virgin-atlantics-marketing-nails-it.html [Accessed 13 Dec. 2018].

Marketing Week. (2018). Virgin Atlantic targets ‘passionate’ experience seekers with new brand ad – Marketing Week. [online] Available at: https://www.marketingweek.com/2015/01/05/virgin-atlantic-targets-passionate-experience-seekers-with-new-brand-ad/ [Accessed 13 Dec. 2018].

Appendix 1:

Appendix 2:

Appendix 3:

Welcome to your brand new blog at University of Brighton Blog Network.

To get started, simply log in, edit or delete this post and check out all the other options available to you.

For assistance, visit our comprehensive support site and check out our Edublogs User Guide guide.

You can also subscribe to our brilliant free publication, The Edublogger, which is jammed with helpful tips, ideas and more.