Introduction
Virgin America is one of the airlines providing services for US passengers. While the market is relatively saturated with low-cost options, safe airlines, and an abundance of options, Virgin America managed to build a reputation as a brand that is different and unique. Instead of following a standard policy of reducing costs and increasing locations, Virgin America decided to put emphasis on the experience of the consumer and the branding itself. Thus, the airline has chosen a differentiated niece targeting strategy with concentrated micromarketing focused on tech-savvy and young consumers willing to pay for a more comfortable and technologically advanced flight.
Segmentation Variables
The geographical segmentation pursued by Virgin America was mainly represented by passengers on the West Coast of the US. However, its acquisition by Alaska Airlines expanded this notion to a more extended one. As a result, the target consumers live in metropolitan areas on the West Coast, yet combining the two geographical segments of both Airlines broadens the barriers. Virgin America is also particular when it comes to appealing to a specific demographic that is becoming more prominent in the US. Furthermore, young and tech-savvy males and females with a preference for comfort over cost is the clientele that is most interested in the products that Virgin America offers. A flight can be particularly difficult for people used to resort to laptops and phones for work, entertainment, and communication, which is why being on an airplane for hours may be an issue. This can be facilitated by the low efficiency of the Wi-Fi on the board, the inability to regulate lights, a lack of charging ports, and other aspects that can disrupt the comfort. Virgin America has equipped the planes with the latest technological advancements to create an environment where people who use technology more frequently than others do not meet difficulties.
In terms of the demographic that Virgin America targets, the consumers are young males and females between 20 and 35 years old. They are educated and have middle to high incomes. This is evident in the prices offered by Virgin America, which are higher than the ones offered by other Airlines that want to appeal to a larger demographic through cost reduction. In terms of marital status, the target consumer does not have a big family with multiple kids, also evidenced by the slightly higher prices, which would increase the spending for families with multiple children. However, single consumers, couples, and small families with middle or high income can all find the services offered by Virgin America appealing and worth the investment.
The psychographic segmentation reflects the personal interests of the target consumer. The person Virgin America attracts values comfort and uses technology on a daily basis. Thus, social media, IT, and new devices are some of the preferences of the customers. The young and tech-savvy individuals are prolific in technology, which is a big part of their lives. Thus, fully-equipped airplanes with power outlets for each seat and touch screens are a must. Moreover, the roomier seats allow for more comfortable use of laptops, which also fits the psychographic segmentation strategy.
The behavioral segmentation illustrates the target marketing to encourage purchases from consumers who are ready to spend more if the product is worth it and fits their needs. Thus, the acquisition is less motivated by the cost and more by the comfort and the fulfillment of the desires of the target consumer. Moreover, the behavior of such consumers is also facilitated by frequent engagement. While airplane tickets are relatively rare occasions for investments for most individuals, the targeted consumer will tend only to use Virgin America because, despite the lower costs offered by rivals, they value the experience. Such individuals may be persuaded by unique and engaging social media posts rather than promotional discounts, tend to make purchases relatively fast through online platforms, and enjoy a personalized experience.
Market Targeting Strategy
As exemplified previously, Virgin America is unique compared to other airlines in terms of appealing to a particular type of consumer. While other airlines are focused on attracting a broader segment, Virgin America is particular when it comes to the consumer it intends to attract. This illustrates the market targeting strategy to be a differentiated and niche one. Niche targeting implies the company’s aim to appeal to a particular demographic instead of creating a product that would be attractive to the most significant number of people possible (Akbar, 2017). Virgin America does not facilitate such broad targets through accessibility regarding prices or locations, which exemplifies that the brand is focused on a certain niche. Moreover, the differentiated approach also implies the organization’s focus on the target segments that are potentially most valuable in terms of willingness to purchase services and products.
Since the consumer is facilitated by the unique niche targeted by the company, it is important to mention the concentrated micromarketing that facilitates the unique branding of Virgin America. According to researchers, this approach is particularly useful when the market is saturated, and the competition is high (Dolnicar et al., 2018). It is certain that there are multiple airlines in the US that appeal to a larger demographic, mainly due to the more attractive prices, promotions, and discounts. This is why the strategy of concentrated micromarketing with the focus on a particular niche consumer allows Virgin America to stand out.
Conclusion
Virgin American managed to become one of the leading airlines in the US due to its prolific targeting strategy and market segmentation. The brand’s focus on young, tech-savvy, social media-oriented individuals living in metropolitan cities on the West coast was an effective technique in terms of providing consumers with unique services customized to meet their needs. Moreover, the differentiated targeting strategy and micromarketing centered around the concentrated pool of niche customers allowed the airline to become one of its kind. Despite the competitiveness of the industry, Virgin Airlines has exemplified how effective targeting can minimize risks and improve revenue without appealing to a broader consumer base.
References
Akbar, F. (2017). The niche marketing strategy constructs (elements) and its characteristics – A review of the relevant literature. SSRN Electronic Journal.
Dolnicar, S., Grün, B., & Leisch, F. (2018). Market segmentation. Management for Professionals, 3–9.