FLYBABOO: HOW HIGH CAN IT FLY?

Internal Analysis
By Syndicate 2:
Berni Rahman I 29116430
Rizky Adhim 29116445
Fatma Widya 29116424
Dian Putri Muliasari 29116384
 In July 2003 Swiss International Air Lines (successor to the
bankrupt Swissair) announced drastic reductions in its network.
Some regional routes were abandoned and withdrawn from the
schedule. One of them was the route between Geneva (Cointrin
airport) and Lugano (Agno airport).
The route can attract 50,000 passengers a year with the price SFr
Case 600 per return trip.
The market gap provide the perfect launch pad for Julian Cooks
Background (the CEO of Flybaboo) new idea, a regional low-cost airline to fill
the growing hole created by the gradual retreat of Swiss from low-
volume routes out of Geneva.
There are three airlines that declared their interest in serving the
vacated route. Besides Flybaboo, another contender was Hello, a
start-up airline led by Moritz Suter (founder of Crossair) and
Darwin Airlines.
 On August 23, 2003 FOCA released new regulations that banned
landings at Agno with aircraft that did not have certification for
descents at more than six degrees.
This new regulation eliminate the two Flysbabooss competitor
Case because both Hello and Darwin Airlines used a plane that did not
meet the criteria . By contrast, Flybaboo had chosen to fly a Dash
Background 8-300, an aircraft certified for steep descents with an approach
path of more than 6 degrees.
Flybaboo requires an Air Operator Certificate (AOC) to start
operating.To obtain AOC in a short period of time, Flybaboo use
wet lease from Lufthansa partner Cirrus Airlines.
 Tangible Description
Financial Resources Have many investor that interested to
Flybaboo Internal invest (exhibit 2).
Organizational resources
Analysis
Physical resources Airplanes Dash 8-300
Technological resources Air Operator Certificate (AOC) for a short
period of time by wet lease from
Lufthansa partner Cirrus Airlines.
RESOURCE
Intangibles Description
Human Resources Flybaboo CEO had a lot of experience in
airline industry and aviation finance.
Innovation Resources
Reputation Resources Flybaboo is low cost focus airlines
Flybaboo is backed by high profile
investors
 Functional Areas Capabilities

Flybaboo Internal Marketing & Sales Stimulate demand by using pricing

strategy (offering low fares to a limited
Analysis number of passengers)

CAPABILITIES Distributions Easy-to-reach and cost effective

distribution channel

Operations Manage to keep operating costs to

minimum
 Capabilities Is the Is the Is the Is the Competitive Performance
Capability Capability Capability Capability Consequences Implications
Valuable? Rare? Costly to Nonsubstit
Imitate? uable?
Flybaboo Internal
Analysis Stimulate
demand by
using pricing Average
strategy Temporary returns to
(offering low Yes Yes No No Competitive above-
fares to a Advantage average
CAPABILITIES limited number
of passengers)
returns

Easy-to-reach
and cost
effective Competitive Average
Yes No No Yes
distribution Parity returns
channel

Manage to keep
operating costs Competitive Average
Yes No No Yes
to minimum Parity return
 Primary Activities Description
Marketing & Sales First come, first serve
Low price for early booking
Target tourist and business travelers

Distribution Exclusively sell tickets via website or

call centre

VALUE CHAIN Operations Point-to-point, short haul flights

Single type of plane
ANALYSIS No catering on board

Support Activities Description

Finance Have many support from reputable
investor
COMPETITIVE The Flybabooss competitive advantage is they can stimulate
demand by offering low fares to a limited number of passengers
ADVANTAGE who booked early.
 Flybaboo needs to establish its brand name as low cost airlines
without compromising the service quality.
Flybaboo should extend its flight routes to more lucrative
destinations.
STRATEGIC Flybaboo should focus on developing company financial stability
COMPETITIVENESS because they need to collect money to get their own AOC.
Flybaboos marketing and sales division must build Flybaboos
brand equity by earning trust and loyalty from its customers.
THANK YOU