II. STATEMENT OF THE PROBLEM

Airphil Express, which also has been called PAL express, is PAL’s budget airline. PAL's transfer of its pilots to its budget airline is the alleged reason for the resignation of the pilots.

PAL had to beef up its operations in order to compete with Cebu Pacific. However, instead of hiring new pilots for Airphil, PAL came up with a different strategy. PAL offered the pilots “another job” --- to be pilots but this time for Airphil Express where they would receive lower salaries and fewer benefits. Not all pilots accepted the “job offer”. Instead of waiting to be declared as redundant or to be offered a job at Airphil and thus meet the same fate as the other pilots, the others decided to resign.

Enticed by higher-paying jobs at foreign airlines, some 26 pilots left the PAL wing. The mass resignation took a toll on PAL flight schedules on the last Saturday of July. PAL cancelled several 150-seater Airbus A320 Manila flights en route to Bacolod, Iloilo, Cagayan de Oro, Cebu and Hong Kong because there were not enough pilots to fly the planes.

These problems which affected the public’s perception about PAL also affected the image of its budget airline, Airphil Express. Because of these events, public’s impression about Airphil Express is substandard as related to Philippine Airlines. With all these issues they affect the position of AirPhil Express in the airline industry.

Another thing, the Philippines lists many registered airline companies mostly chartered; there are only five competing commercial airlines with scheduled flights serving the domestic market. Leading among the five is Cebu Pacific which has captured 45.6 percent of the market, followed by Philippine Airlines-Airphil Express group which has flown a combined 4.9 million passengers in 2008. Next after PAL-Airphil Express group is Zest Airways which has already overtaken South East Asian Airlines.Zest Air which is formerly Asian Spirit has been acquired by Alfredo M. Yao of the Zest-O juice drink fame. AMY Holdings which owns Zest Airways has been planning to acquire South East Asian Airlines but the Lopez-Gitsis-Dornier tandem refuses to badge Yao's offer of merger. Recently, Spirit of Manila Airlines launched purely international flights to Middle East andEast Asia.

Despite of its low cost and good quality services offered, still AirPhil Express remains as market follower to Cebu Pacific. The development of promotional strategies for Air Phil Express to be the leading low cost carrier in the Philippines is needed which will encourage Filipinos to travel locally through its best deals and services thus will make AirPhil Express as the leading service provider in airline industry.

III. SITUATION ANALYSIS

Air Philippines was incorporated on 13 February 1995, with the base of operations being the former Naval Air Station Cubi Point. Flight operations started on 1 February 1996 with a Boeing 737-200between Subic Bay, Iloilo and Zamboanga.

In 1996 six NAMC YS-11 and four Boeing 737-200 aircraft were acquired by the company. In 1997 an additional one Boeing 737-200 was acquired. In this same year the airline carried over 675,000 passengers and over 773,000 in 1998. In September 1998 the airline was temporarily grounded by the Philippine Air Transportation Office, but was reactivated when U-Land agreed to purchase a stake.

It was in 1999 when Lucio Tan Group took over management of the Company. In March 1999, Air Philippines was granted approval to operate international services to Hong Kong, Japan, South Korea, Taiwan and the USA.

In May 2001 two Boeing 737-300 aircraft were delivered. In mid-2002, charter flights were started from Subic Bay and Laoag City to Hong Kong. Passenger numbers carried rose to nearly 881,000 in 2002. In July 2004 charter flights started from Subic Bay to Guangzhou.

Air Philippines significantly increased ties with Philippine Airlines (PAL), including the merging of frequent flier plans, timetables, and ticket sales. Air Philippines also recently moved into the PAL terminal at the Ninoy Aquino International Airport (Manila). Some of PAL's major stockowners are also owners of Air Philippines. Though Air Philippines will officially cease to be part of the Philippine Airlines Frequent Flier Programme "Mabuhay Miles" as of the 1st of October, 2007. Air Philippines has said that they chose to back out of the Mabuhay Miles program to benefit their passengers, so rather than flying numerous flights to gain miles and wait to a certain point to receive bonuses, passengers can benefit with lower fares and more discounts with quicker bonuses, much more like today's modern day low-cost airline.

On July 24, 2008, it moved all its operations to terminal 3 of the Ninoy Aquino International Airport.

On August 31, 2009, Air Philippines ceased all operations and folded operations into Philippine Airlines and PAL Express.

On October 27, 2009, Air Philippines began operating all PAL Express flights on behalf of Philippine Airlines.

On March 28, 2010, Air Philippines resumed operating services under their own right to Iloilo,Bacolod, Puerto Princesa and Cagayan de Oro, utilizing Airbus A320 jet aircraft under the name AirPhil Express. The airline subsequently operated eight Bombardier Aerospace turboprop aircraft and two new Airbus A320s, all of which originally belong to Philippine Airlines.

APC MISSION

Air Philippines Corporation shall provide:

1. customers with safe and reliable air transportation with the best service at the least cost;

2. employees with career development and job satisfaction; and3. stockholders with fair return on their investment.

Destinations

Bacolod BusuangaCagayan de Oro Calbayog Catarman Caticlan (Boracay) Cebu Cotabato Davao Gen. Santos

Hong Kong Iloilo Jolo Kalibo LaoagLegazpi Manila Masbate Naga Ozamiz

Puerto PrincesaSan Jose (Mindoro)SingaporeSurigaoTaclobanTagbilaranTawi-tawiTuguegaraoZamboanga

Routes

Manila to Bacolod (v.v.) Manila to Busuanga (v.v.) Manila to Cagayan de Oro(v.v.) Manila to Calbayog(v.v.) Manila to Catarman(v.v.) Manila to Caticlan (Boracay) (v.v.) Manila to Cebu(v.v.) Manila to Cotabato(v.v.) Manila to Davao(v.v.) Manila to Gen. Santos(v.v.) Manila to Iloilo (v.v.) Manila to Kalibo(v.v.) Manila to Laoag (v.v.) Manila to Legazpi(v.v.) Manila to Masbate(v.v.) Manila to Naga(v.v.) Manila to Ozamiz(v.v.)

Manila to Puerto Princesa(v.v.) Manila to San Jose (Mindoro) (v.v.)Manila to Singapore(v.v.) Manila to Surigao(v.v.) Manila to Tacloban (v.v.) Manila to Tagbilaran (v.v.)Manila to Tuguegarao(v.v.)Manila to Zamboanga(v.v.)Cebu to Bacolod(v.v.)Cebu to Cagayan de Oro(v.v.)Cebu to Caticlan (Boracay) (v.v.)Cebu to Davao(v.v.)Cebu to Hong Kong(v.v.)Cebu to Iloilo(v.v.)Cebu to Ozamiz(v.v.)Cebu to Tacloban(v.v.)

Davao to Cagayan de Oro (v.v.)Davao to Iloilo (v.v.)Zamboanga to Jolo (v.v.)Zamboanga to Tawi-tawi (v.v.)Busuanga to Puerto Princesa (v.v.)

Air Philippines Corporation Milestones

1995

Air Philippines was incorporated with an initial authorized capitalization of PHP 500 million.

1st of 8 B737-200 was delivered in December

1996

1st day of commercial operation to Subic (SFS), Iloilo (ILO) and Zamboanga (ZAM) using B737-200

Six (6) YS-11, 60-seater turbo prop aircraft were delivered in April 1st revenue flight to Kalibo (KLO) using YS-11

1997

Air Philippines was chosen "Most Outstanding Airline" � by the Consumer Union of the Philippines.

Congress approved House Bill 6445 granting Air Philippines a franchise to operate and maintain domestic and international air transport services, valid for a period of 25 years.

Cut-over of Gabriel II Reservations system in December.

2000

Air Philippines was awarded the Diamond Award for the Transportation and Travel industry sector in the 2000 Grand Prix Customer Service Awards

2001

Two ( 2) B737-200 aircraft delivered. Manila-Butuan (via) Cebu, Flight launched

2002

Awarded "MOST OUTSTANDING DOMESTIC AIRLINE" for 2001 for the 3rd time by the Consumers Union of the Philippines.

Cebu Hub operations was started. CEB-ILO v.v.; CEB-BCD v.v.; CEB-DVO v.v. Regular flights to Tuguegarao (TUG) was inaugurated in December.

2003

Air Philippines was conferred 2003 Asia-Pacific Consumers Excellence Awardee as "Outstanding Domestic Airline" jointly by Asia-Pacific Awards Council and National Consumer Affairs Foundation

Awarded as "Most Outstanding Domestic Airline" by the Parangalng Bayan Foundation, Incorporated.

Awarded as "Most Outstanding Domestic Airline" for the fourth time by the Consumers Union of the Philippines.

Additional 3 B737-200 were delivered to replace retired jets.

2004

Air Philippines was awarded as "Outstanding Domestic Airline" by Parangalng Bayan Foundation.

Awarded as "Outstanding Domestic Airline Company" by the Asia Pacific Awards Council jointly with National Affairs Foundation.

Flights from Manila (MNL) to KWANGJU (KWJ), South Korea were launched in partnership of Saehoon Travel in South Korea.

Chartered flights from Subic (SFS) to Guangzhou (CAN), PROC started in July. PACERS II Reservations Systems; Departure Control System(DCS); STAR Ticketing were

cut-over in July. Mabuhay Miles in partnership with PAL was implemented in July. Additional B737-200 was delivered in August.

2005

Additional B737-200 was delivered in February. Regular flights from Manila (MNL) to Shenzhen (SZX), People's Republic of China was

inaugurated. Cebu (CEB) to Puerto Princesa (PPS) vv, flight was launched in November. Cebu (CEB) to Zamboanga (ZAM) vv, flight was launched in November.

2006

Manila (MNL) to Legaspi (LGP) vv and Cebu (CEB) to Legaspi (LGP) vv, flight launched Final delivery of 2 B737-200 aircraft made in May and July. Air Philippines flights transferred operations at Centennial Terminal (T2) Airport in

Manila. E-Ticket was launched in November

2007

Regular flights to Naga (WNP) started in January. Regular flights to Ozamis (OZC) was inaugurated in July. Cebu (CEB) to Tacloban (TAC) vv, flights was launched. First Q300 (Bombardier) was delivered in December. Regular flights to Boracay (Caticalan, MPH) was launched New ticket office and passenger lounge were inaugurated

2008

B737-300 was transferred to Air Philippines Corporation Air Philippines Corporation (APC) was granted by then Air Transportation Office (ATO)

now Civil Aviation Authority of the Philippines (CAAP) an Air Agency Certificate to operate a Repair Station.

Air Philippines domestic operations was transferred at NAIA Terminal 3 (T3) Airport in Manila.

2009

Cut-over of SABRE SONIC Reservation and Ticketing, SABRE SONIC Web-online Booking and Payment, SABRE SONIC Check-in, SABRE SONIC Travel Agency Portal, SABRE SONIC Agency Activity System, SABRE SONIC Load Manager

THE PROBLEM

Although, the Philippines list many registered airline companies mostly chartered, there are only five competing commercial airlines with scheduled flights serving the domestic market. Leading among the five is Cebu Pacific which has captured 45.6 percent of the market, followed by Philippine Airlines-Airphil Express group which has flown a combined 4.9 million passengers in 2008. Next after PAL-Airphil Express group is Zest Airways which has already overtaken South East Asian Airlines.

Zest Air which is formerly Asian Spirit has been acquired by Alfredo M. Yao of the

Zest-O juice drink fame. AMY Holdings which owns Zest Airways has been planning to

acquire South East Asian Airlines but the Lopez-Gitsis-Dornier tandem refuses to badge

Yao's offer of merger. Recently, Spirit of Manila Airlines launched purely international flights

to Middle East and East Asia.

A. SWOT ANALYSIS

STRENGTHS

Management is focused on accelerating profitability by introducing brand new aircraft and innovating marketing strategies

In addition to its current fleet of eight Bombardier Q400 and Q300 turboprop aircrafts, AirPhil Express will be utilising Airbus A320-200 which is capable of carrying 177 passengers.

Provides “low fares with a premium travel experience” Recently recognized as the “World’s Most Sociable Airline” by Planely.com.

WEAKNESSES

Brand’s association to Philippine Airlines which affects the perception of the clients about AirPhil Express.

Low brand awareness due to lack of promotional activities.

OPPORTUNITIES

Increases in the country’s GDP growth, which led to increased employment opportunities and higher disposable income among Filipino consumers.

The high level of domestic promotional events undertaken by the Department of Tourism (DOT) and DOT’s partnerships with various private travel and tourism companies resulted in strong growth in domestic tourism.

Positive growth rates in inbound arrivals and domestic tourism High local low-cost carrier market penetration rate which

THREATS

Filipinos who have already travelled extensively within their own country will be more motivated to travel overseas during the forecast period in search of new experiences and new adventures.

The higher employment rate and increases in disposable incomes projected for the Philippines over the forecast period are expected to lead to significantly increased demand for outbound tourism, leading to lower demand for domestic tourism and, subsequently, lower growth.

B. MARKET AND CONSUMER BEHAVIOR ANALYSIS

Air Philippines Corporation, now operating as Airphil Express is a low-cost airline operates both domestic and international scheduled services from Manila, Cebu, Davao and Zambaonga. The new Airphil Express shrunk its market share and relegated it to the no. 2 spot from its dominant no. 1 position since inception. Airphil Express currently holds the no. 3 position among Philippine-based airlines with 19% market share. Airphil Express (APX) is expected to remain as the fastest growing low-cost carrier in the country despite the entry of new foreign airlines in the industry. With the deployment of their new fleets, APX’s market share has rushed 353 percent to 1.9 million passengers in 2010. APX cornered 11 percent of the domestic market last year or nearly 4 times its market share of 2.9 percent in 2009, making it the country’s number three airline. It has tried to differentiate itself by offering some frills such as free check-in baggage and seeks to increasingly corner a considerable share of the budget airline market by offering budget travelers with compelling value propositions. APX markets itself as a budget airline that provides 'low fares with a premium travel experience'.

As consumers demand more value for their peso, AirPhil Express distinguishes itself as “the airline with a heart” by adhering to a low-cost carrier model that strives to take good care of its passengers even as it offers affordable airfare.One of the primary target audiences of Airphil is the local residences including leisure traveler, business traveler and visiting friends and/or relatives coming from social class A-D with an age bracket of 15 years old and above. They are price conscious people and want to spend their money wisely. Moreover, they travel domestically for at least twice a year. Also, other customers are the Overseas Filipino Workers. This group comes from social class C-D with an age bracket of 21 years old and above. They are also price conscious people and want to spend their money wisely. Moreover, they travel domestically for at least twice a year and are eager to see their relatives and friends quickly and comfortably at an affordable price. The airline noted that passenger volume soared by 143 percent or 1.6 million passengers to reach 2.72 million during the January-September period compared to 1.12 million in the same period last year.

C. COMPETITIVE ANALYSIS

Industry Profile

In the wake of the global economic downturn, one of the hardest hit industries worldwide has been the aviation industry. In early 2009, the Centre for Asia Pacific Aviation (CAPA) reported that passenger demand fell 3.5% with an average load factor of 75.6%. Furthermore, the CAPA and airlines worldwide expected losses of 5.6 billion in 2010. As a result of these, one trend that emerged was company mergers of two, sometimes three airline companies just to cut down on cost and stave off bankruptcy. Another popular trend that has gained prominence during the crisis is the low-cost carrier (LCC) business model.

While the competition from within the aviation industry has intensified with the growth of LCCs, airlines still must also compete with other modes of transportation even for long distance domestic travels. For long distance domestic travels, we may consider buses and private vehicles as primary modes for land based travel and commercial ships for sea based travel. According to the Land Transportation Office (LTO), approximately 5 million vehicles were registered in 2007; 2 million in cars and utility vehicles and 30,000 of which were buses. Meanwhile, sea transport reported 42 million in passenger traffic according to the Philippine Ports Authority (PPA). On the other hand, air transport only generated 26 million in passenger traffic according to the Air Transport Authority (ATO).

Comparing the three transportation modes, we can see that a large part of the domestic passengers market is still dominated by sea transport while there is potential for both sea and air to capture the relatively small percentage held by land based transport

From the list shown above, six carriers are competing commercially: Philippine Airlines, Cebu Pacific, Airphil Express, Zest Air, Seair and Spirit of Manila. The rest offer either domestic charter flights or cargo services. Of these, Philippine Airlines, the flagship carrier of the country, is the only one that offers international flights while Cebu Pacific and Spirit of Manila currently offer the largest number of regional destinations. Airphil Express, Zest Air and Seair offer mostly domestic flights. Recently, Airphil Express opened its regional flight to Singapore.

In the Philippine domestic flight market, Cebu Pacific is the leading carrier capturing 45.6 percent market share followed by Philippine Airlines, Airphil Express, Zest Air, Seair and lastly, Spirit of Manila Airlines.

Competitive Environment

A. Direct Competitors

Cebu Pacific Phil.Airlines Zest Air SEAir AirPhil Express(Competitive Advantage)

Domestic market share

44.9% 25.7% 10.5 % 1.7 % 10.5%

Market share for domestic passengers

10.5 million 9.2 million 1.9 million

Flightdestinations 23international, 50 domestic

30 domestic and more than 30 foreign destinations.

Over 20 destinations in the Philippines and East Asia

18 domestic and 3 international destinations

25 domestic, 1 international destination

Fleet - Operates a fleet of 29 Airbus (10 A319 and 19 A320) and 8ATR 72-500 aircraft, the youngest fleet in the Philippines- Only airline in the Philippines operating a 100% brand-new fleet with 27 Airbus (10 A319 and 8 ATR 72-500 aircraft.

- 40 Aircraft has 777-300ER, the world’s largest long-range twin-engine jetliner, powered by the largest & most powerful commercial jet engine- owns 30 Airbus aircraft and four Bombardier airplanes.

8 Bombardier Q400 and Q300 turboprop aircrafts, Airbus A320-200 (capable of carrying 177 passengers)

Programs - Offers the lowest year round Lite Fares for its destinations.- 1st local airline to introduce E-ticketing, prepaid excess baggage& seat selection in the Philippines.- only domestic carrier that offers fun in the skies with its games on board popularly known as Fun

Do programs such as Corporate Tie-Ups, Educational Trips, Product Updates

- Offering some frills such as free check-in baggage.- provides “low fares with a premium travel experience”- 20kg. Baggage allowance, 3kg. hand luggage/hold luggage

Flights, together with its entertaining inflight magazine, SMILE

Strengths - Traffic is 12%- dominates the low-cost carrier industry- low cost producer- remains to be the pioneer in creative pricing strategies.

Targets budget-conscious segment of the travelling market with its”econolight class”.

- Newest budget airline in the Philippines- management is focused on accelerating profitability by introducing brand new aircraft and innovating marketing strategies.

- Management is focused on accelerating profitability by introducing brand new aircraft & innovating marketing strategies.- “World’s Most Sociable Airline” by Planely.com- low cost

B. Indirect Competitors

- WG&A Philippines- Negros Navigation- Sulpicio Lines, Inc.- MBRS Lines- Viva Shipping Lines- Bus Lines

C. Competitive Advantage

AirPhil Express

- 10.5% domestic market share- 1.9 million passengers- 25 domestic destinations along with the one international destination- management is focused on accelerating profitability by introducing brand new

aircraft and innovating marketing strategies- offering some frills such as free check-in baggage- Provides “low fares with a premium travel experience”- In addition to its current fleet of eight Bombardier Q400 and Q300 turboprop

aircrafts, AirPhil Express will be utilising Airbus A320-200 which is capable of carrying 177 passengers.

- Recently recognized as the “World’s Most Sociable Airline” by Planely.com.

- Number of aircraft- 14- 20 kg Baggage allowance, 3 kg Hand luggage / hold luggage- Low cost

D. PRODUCT ANALYSIS

“Escape. Indulge. Discover” is the current slogan of PAL Express, currently known as Airphil Express. It is a low-cost airline directly competing with Cebu Pacific Air and the no.1 low cost carrier for both passenger and cargo in domestic market at present time. It is the fastest growing budget carrier in the Philippines posting the highest passenger and cargo growth in the first 9 months of the current year.

Airphil Express Fleet

Aircraft Total OrdersPassengers(Economy) Routes Characteristics

Airbus A320-200 7 13 177/180

Domestic/International

Provides exceptional levels of comfort w/ optimized seating, legroom, and elbowroom, and substantial stowage space.

Equipped with advanced avionics systems.

Bombardier Dash 8 Q300

3 0 56 Domestic

Nicknamed as the “Quiet One” as it provides jet-like, soft and quiet ride because it has state-of-the-art Noise and Vibration Suppressing System.

Can take-off on short runways which are perfect for most airports in the archipelago.

Bombardier Dash 8 Q400

5 0 76 Domestic

Known to be the world’s fastest turbo-prop.

It is faster, more efficient and friendly to the environment.

Pilot’s favorite because of its speed and comfort like a jet.

Total 15 13

The table above shows the youngest and the most reliable fleets used by Airphil Express to provide low-cost but high quality service to their customers especially to the Filipino travelers.

Airphil Express has also expanded its routes and currently serves 26 local destinations and two international flights to better serve its customers. Some of its most recently inaugurated local destinations include Manila-Tacloban (v.v.), Manila-Ozamiz (v.v.), Davao-Iloilo (v.v.), Manila-Cotabato (v.v.), and the Manila-General Santos (v.v.) routes. Aside from the Manila-Singapore route, Airphil Express now also offers the Cebu-Hong Kong flight.

Travel ServicesOffered Service

Description How to Avail?

Seat Selector

A passenger can pre-reserve their seats for a minimal cost.

Standard Seats – P100/ wayPremium Seats (such as exit rows and first two rows) – P200/way

A passenger can pre-reserve a seat:During their online ticket purchase.By requesting Seat Selector when

purchasing ticket through APX Reservations or at any APX Ticket Office.

Web Check-In

The most convenient and simple way to check-in to any Airphil Express flight and saves time by avoiding long queue at the airport.

Web Check-In is available from 24 Hrs. to 3 Hrs. before the scheduled flight departure time. Check-in under the Products and Services drop down selection of the company’ website, www.airphilexpress.com.

Travel Insurance

Protects the passengers and their trip from unexpected events such as accidents, lost travel documents and other travel inconveniences.

Apply online. Check-in under the Products and Services drop down selection of the company’s website, www.airphilexpress.com.

Prepaid Baggage

Allows passengers to pay their excess baggage in advance and get as much as 20% discount off from the standard excess baggage rate.

1. Additional 5 kgs - PHP 400.00 inclusive of VAT.

2. Additional 10 kgs - PHP800.00 inclusive of VAT.

3. Additional 15 kgs - PHP 1,200.00 inclusive of VAT.

Prepaid Baggage is available between the time of booking and up to 48 hours prior to flight departure.

Other ServicesOffered Service

Description How to Avail?

Online Customer Service

Dedicated 24/7 customer service using social media tools like Twitter and Facebook.

Please visit: Twitter Account: http://twitter.com/airphilexpressFacebook Account: http://www.facebook.com/airphilexpressph

TGIF! Thank God It’s Free

The first electronic newsletter of Airphil Express where the customers can be updated with the latest promo fares, packages and tie-ups.

Fill up the subscription form available at the Products and Services drop down selection of the company’s website, www.airphilexpress.com.

Free Baggage Allowance

Airphil Express is the only airline that allows as much as 15 kilos of free check-in baggage allowance and an additional 7 kilos free hand-carry luggage.

It is automatically available for every customer of Airphil Express.

Discounts and PromotionsDiscounts/Promos Description

Student DiscountThey are the first to offer 20% discount for students on all published fares for its domestic routes, including selected promotional fares.

Airphil Express Rewards Program

A free flight program that allows a customer to exchange ten (10) used boarding passes bearing his/her name for a one-way, free ticket to any local destination of his/her choice.

IV. TARGET MARKET / AUDIENCE

The program that the company will implement consists of different activities that fit for the Filipinos and segmented according to these major variables:

Primary Target Audience

Local Residence

Demographic:- Age ranging 21-55 years old- From socio economic class B to D- 23.1 Million local residences travels within the country- Male or Female- Single or Married

Lifestyle- Price conscious professionals- Leisure tourist who loves to travel

Behavioral- 6-month to yearly purchase

Business Travellers

Demographic:- Age ranging 21-55 years old- From socio economic class B to D- Male or Female- Single or Married

Lifestyle- Budget conscious

Behavioral- 6-month to yearly purchase

Overseas Filipino Workers

Demographic:- From social class C-D- Age bracket of 21 years old and above

-2 Millions OFW’s across the globe- Can be male or female- Single or Married.

Lifestyle- Price conscious persons- Want to spend their money wisely.

Behavioral- Travel domestically for at least twice a year.

Foreigners

Demographic:- Age bracket of 21 years old and above- Can be male or female- Single or Married.

Lifestyle- Price conscious persons- Want to spend their money wisely.

Behavioral- Travel domestically for at least twice a year- Find time unwind- Want to witness the beautiful sites of the country.

Secondary Target Audience

“Barkada”

Demographic:- From social class A-D- Age bracket of 15 years old and above- 8.8 Million foreigners who visit the country a year- Can be male or female- Single or Married.

Lifestyle- Likes to travel for leisure and recreation.

Behavioral- Travel domestically for at least twice a year- Often avail packages that been offer by the airline companies.

. Schools

Demographic:- Institutions that specialize in tourism and other related course

Lifestyle- Uses the services of the airline companies for the purpose of educational trips

Behavioral- Travel domestically for at least twice a year- Often avail packages that been offer by the airline companies.

Others

Demographic:- Business firms, government institutions and non-government institutions

Lifestyle- Often travel due to their jobs as well as to have a little relaxation.

Behavioral- Travel domestically for at least twice a year

V. OBJECTIVES

A. MARKETING OBJECTIVES

1. To enlarge the market share to 45% in the target market in one year.2. To establish the company as the market leader in the Airline business in one year.3. To increase the consumer’s brand awareness.

B. IMC OBJECTIVES

1. To change the customer belief to the company’s employees and the company’s appearance as a whole.

2. To encourage repeat purchases to the company’s product and services by maintaining and promoting a good and satisfying brand image to the consumers.

3. To improve the company’s image.

C. MEDIA OBJECTIVES

1. Produce localized TRIMP ads targeting urban and rural areas from different regions.2. Develop a national ad campaign that will capture 75% viewership as well as readership.3. Create programs that will use out of home and digital platforms.

VI. COMMUNICATION STRATEGY

BIG CONCEPT: JUAN’s JOURNEY

Campaign Rationale:

The message of the campaign is to encourage Filipinos to prefer travelling domestically rather than internationally. It aims to establish AirPhil Express as a premier domestic travel provider at low cost with a vision to promote the experiences a true Juan’s Journey can bring. Such as different best spots in the Philippines, the mouth-watering foods, different cultures and many unforgettable experiences.

This campaign will make every Filipino say that “This is what Juan’s Journey is, everyone must experience it”. Likewise, this campaign wanted to encourage Filipinos to experience the services offered by AirPhil Express. The “Juan” refers to a Filipino that is in-need to travel domestically to discover that there is more in the Philippines compare to other countries.

A. EVENTS

Campaign Title: Start of Journey

Rationale:

The event will be a social gathering – dinner buffet with orchestra for entertainment; in this event will be the launching of the AirPhil Express’ “Juan’s Journey” campaign. This campaign will let every clients and stakeholders to know and feel what a Juan’s journey really is. Aside from italsobe the launch of AirPhil Express’ plan for every Juan for the year 2013, and the introduction of AirPhil Express’ Juan to 12- a sales promo for the whole year.

AirPhil Express will invite the press people, the company VIPS and the employees of course. The event would be hosted by Ms. Nikki Gil and Billy Crawford.

A video will also be presented at the Dinner Buffet, a teaser to what will you expect from AirPhil Express for the coming Year. This will be featured in whole page in business magazines and Lifestyle Magazines such as Good House Keeping, it will be featured also in whole page in the business section of newspapers – PhilippineDaily Inquirer, Manila Bulletin and Philippine Star and it is expected to be featured In TV news, the press people will be relating and narrating to everyone what happened to the Social gathering. Aside from different magazines and newspaper this event will reach the digital sphere since different blog sites will be utilized too to blog the story that happen in the said event.

MEDIA

NEWSPAPER – BUSINESS SECTION (Publicity)

It will be featured in Business section because it is Business Related.

It will be printed colored in a whole page.

Newspaper is one of the best ways to reach people, especially Professionals, to inform them about what’s going in the business world.

Philippine Daily Inquirer – 842,000 readers

Manila Bulletin -625,000 readers

Philippine Star – 540,000 readers

BUSINESS MAGAZINES AND LIFESTYLE MAGAZINES

Good House Keeping Magazine

B. PUBLICITY

C. SPONSORSHIP

Campaign Title: Share Juan’s Journey

Rationale:

This sponsorship aims to let every Juan experience travelling and witness the rich culture and sceneries in the Philippines. This will be the beginning of every Juan’s journey. Through this sponsorship, Juan will have new experience and will eventually share this to his/her friends.

AirPhil Express will grant every Juan’s dream journey. They will tie-up with various hotelsfor Juan’s accommodation. The journey will include destinations where Juan can see for himself the beauty of his own country. He/she can share this journey with his/her barkada or family up to four members. To be part of this program, Juan must share his/her dream journey and the reason why he/she needs to win. He/she must send it to the “Juan’s Journey” website or email.

MECHANICS:

1. Like the page of AirPhil Express in facebook.2. Write your dream journey and the reason why you should win.3. Send your story to AirPhil Express facebook page. The first 20 stories per month will be

validated and must earn number of likes.4. Criteria for judgment will be:

Unique – 40% Sincerity- 40% Impact (based on number of likes) - 20%

5. There will be one winner every month.

6. The winner can invite four of his/her friends or family to join him/her in his/her dream journey.

7. The winner will win a round trip for two destinations with hotel accommodation all expense paid by AirPhil Express.

MEDIA

Internet Website/Facebook PRINT ADS

D. Sales Promo

Title: Juan to Twelve (12 month promo of Airphil Express)

Rationale:

“Juan to Twelve” is the 12 month promo of Airphil Express. It offers customers their most special and low cost promos in their fare rates in whatever destination the customers would love to. It will run for 12 months, every month, there will be a special promo for a specific occasion and sometimes for a specific place. This will maintain the name of Airphil Express as the leading low-cost airline and because of this, customers will recognize them.

This sales promo scopes the objective of enlarging the market share by 25%. If “Juan to Twelve” sales promo will be consumed by many customers, their sales will go higher and with high sales, Airphil Express’ market share will go higher too. Customers will surely acquire the promo because of its very low cost fares that would give them the opportunity to go to places that they would love to stay.

Airphil Express is the leading promo airline carrier to Manila and other great destinations in the country. The holidays are the perfect time for promotions and sales. That’s why Airphil Express gives you a promo that will run for twelve (12) months. The promo can be the following: (1) Any person that will avail one ticket for the day of the month that will be cited below will gain one free ticket (2) There will be a price that can go as high as 50% (3) Ticket prices that can go as low as P1 up to P12 only as their special offer. The promo dates are as follows:

January – “January Juan Loves You” – Airphil Express is celebrating the New Year with you and its special fare deals to whatever destinations you would love to stay. Selling period will start Nov 27 up to Dec 4 of the previous year and the travel period will be the whole month of January.

February – “The Juan For You” – Stepping up its promotional offering, Airphil Express is launching another special treat for travelers in time for Valentine’s Day, purchase a business class ticket and get another one, absolutely for free. Selling period will be Dec 26 up to Jan 1 and travel period will be the whole month of February and have an escape for two.

March – “March with Airphil” – As a bonus treat to the graduates of 2012, Airphil Express is giving out discounted seats to several domestic destinations for this month as a salute to all the graduates. Selling period will be Jan 30 up to Feb 5 and travel period will be Feb 27 up to April 8.

April – “Holy April with Airphil” – April will be a vacation for students and some employees usually have their break on this month too. Aside from these reasons, this year’s April will have a long no-work holiday because of the celebration of the annual Holy Week. This is the perfect

chance to have a long and relaxing getaway with your family and friends. Selling period will be Mar 5 up to 11 and travel period will be the whole month of April.

May – “Juan De Mayo” – Because May is one of the most awaited months in the entire year, we’re giving a discount to customers who are wearing floral suits on the day of selling of tickets. Selling period will be April 2 to 8 and travel period will be May 7 to June 3.

June – “BalikEskwela-Juan” – Airphil Express celebrates your school comeback this month of June, they are giving away promo fares to selected domestic destinations. Selling period will be April 30 up to May 6 and travel period will be the whole month of June.

July –“Juan Peso” – The year is almost at its other half, that’s why Airphil Express is giving customers their most low fare cost. Tickets will be priced for as low as P1 up to P12 only. Selling of tickets is on a first come first serve basis. So what are you waiting for? Selling period will be May 28 up to June 3 and travel period will be July 2 up to 29.

August – “BayaniKa Juan” – Airphil Express salutes the nation’s heroes with a major seat sale on all its domestic routes this week. Selling period will be June 25 up to July 1 and travel period will be August 6 to 26.

September –“PamilyangPinoy, Number Juan” – September considered as the “Filipino Family Day”, that’s why Airphil Express is giving families the chance to grab this opportunity to have a vacation and have a special bond with each member of the family. Selling period will be July 30 up to Aug 5 and travel period will be Sept 3 to 30.

October –“Number Juan siTitser” – We have considered our teachers as our second parents that’s why Airphil is giving them a very special treat. Selling period will be Aug 27 up to Sept 2 and travel period will be Oct 1 to 28.

November –“Trip or Treat with Juan” - In line with the celebration of Halloween, All Saints’ Day and All Soul’s Day, Airphil Express will offer more treats than trick with its low fares this Halloween! Selling period will be Oct 1 to 7 and travel period will be Oct 29 up to Nov 25.

December – “Blast of 2014” – As a special treat, Airphil will offer giveaway rates for all its domestic destinations and daily surprise “add ons” or “sweeteners” on top of attractive promo fares. Passengers are advised to watch out for daily announcements on print, radio, the Airphil website and Facebook for the latest updates on freebies. Seats are limited and are on sale on a “first come, first served basis”. Selling period will be Oct 29 to Nov 4 and travel period will be Nov 26 up to Dec 30.

MEDIA:

1. Print Ads

Newpaper- Manila Bulletin , Philippine Daily Inquirer and Philippine Star

Posters

2. Radio

Magic 89.9 Love Radio 90.7 Yes Fm 101.1

RADIO SPILL for “JUAN to 12”

A. The whole “Juan-to-12” Promo

(3 Seconds) wind sound and airplane landing sound

VO: Holidays are best enjoyed with the family and special ones.

VO: Experience it with AirPhil Express as it brings you it’s newest “Juan to 12”- the 12-month promo of the leading low cost domestic airline.

VO: So what are you waiting for?

VO: Fly now with AirPhil!

VO: For more inquiries visit www.airphilexpress.com. See posters and print ads for more details.!

B. for the “January Juan loves you” promo

(fireworks 3 seconds)

VO Male: Start your year right! Start it right with AirPhil express! As it proudly presents “January Juan loves You”. Experience the excitement of new year with your loved ones.

VO: 12-month promo begins now! See posters and print ads for more details.

C. for “The Juan for You” promo

Boy: AirPhil Express ka ba?

Girl: Bakit?

Boy: Kasi gusto ko lumipad kasama ka eh... (mwaaah sound)

VO Male: Siya na nga and “The Juan for You”. Fly now with AirPhil Express. Ito and swak para sa valentine season niyo.

VO: See posters and print ads for more details.

D. for “March with AirPhil” promo

(5 seconds graduation march sound)

VO: Salute to all the graduates! Give yourself a treat! March with AirPhil! Celebrate it with AirPhil!

(3 seconds Applause!)

VO: See posters and print ads for more details.

E. for “Holy April with AirPhil” promo

(3 seconds Solemn Sound)

VO: This season, visit the sacred and holy places in the Philippines as you pray and reminisce the goodness, and sufferings and sacrifices of the Lord. Have a “Holy April with AirPhil.”

VO: See posters and print ads for more details.

F. for “Juan de Mayo” promo

(3 seconds Parade Sounds)

VO: Makiisa! Makisaya! Sa bawat Pilipino para sa taunang “Juan de Mayo”.

VO: Makidiwang upang iyong maranasan and selebrasyon ng bawat Pilipino. Sa iba’t ibang sulok ng bansa!

VO: Hatid sa inyo ng AirPhil Express! See posters and print ads for more details.

G. for “Balik Eskwela-Juan” promo

Girl 1: Umalis naman tayo bago magpasukan.

Girl 2: o sige, pero yung afford lang ha.

Girl 3: Isa lang naman ang sagot dyan.

Girl 1 and 2: Ano?

Girl 3: “Balik Eskwela Juan” ang promo ng AirPhil Express

VO: See posters and print ads for more details.

H. for “Juan Peso” promo

(bata ngaalphabet)

Bata 1 : A, B, C, D, E, F, G, H, I, J, K , L, M, N, O, Peso........

VO: Piso na lang ang fare sa AirPhil Express. Kaya ano pang hinihitay mo? Pa-book na!

(People Running Sound)

VO: See posters and print ads for more details.

I. for “Pamilyang Pinoy, Number Juan” promo

(Auditorium sound)

Boy: Pamilyang Pinoy, Number Juan! Bow!

Boy: Iba ang Pinoy pagdating sa pamilya Gusto nila lahat masaya AirPhil Express ang dapat kasama Kaya ano pang hinihintay? Lipad na!

VO: See posters and print ads fo more details.

J. for “ Number Juan si Titser” promo

Boy: Bakit number 1 si teacher?

Student 1: Dahil matalino siya

Student 2: Dahil mabait siya

Student 3: Dahil mahal niya po ang mga estudyante niya.

VO: Kasama mo ang AirPhil Express sa pagdiwang ng “Araw ng mga Guro”. Ao pang hinihintay mo Maam...? Lipad na!

VO: See posters and print ads for more details.

K. for “Trip or Treat with Juan” promo

( 5 seconds Scary Sound)

Girl 1: May tao ata sa labas. Tignan mo nga kung sino.

Girl 2: Ayoko ! Natatakot ako!

Girl 1: Ako din eh! O sige tingnan nati parehas!

(Opening door Sound)

(shouting of girls)

VO (Ghost sound): Happy Trip or Treat! Brought to you by AirPhil Express.

VO: See posters and print ads for more details.

L. for “Blast of 2014” promo

( 5 seconds Christmas Song)

VO: As the year ends, AirPhil Expresss gives you “ The Blast of 2014”. Another journey ends, but Juan’s Journey will not. Keep flying!!

VO: See posters and print ads for more details.

E. PUBLIC RELATIONS

Rationale:

Testimonials from weel-known celebrities will be utilized to serve as the PR of this campaign. Their testimonials will include everything about AirPhil Express, it’s difference to PAL and facts about the both of them. This will also includes the comments and sights of thr celebrities about the AirPhil Express’ new campaign which is “Juan’s Journey”

With this target audience will be aware of what is AirPhil Express and how they can able to offer different quality of service to its clients eventhough it is in the same management as in the PAL.

The objective of this program is to have an answer on AirPhil’s problem on the public perception. Due to the fact that PAL and AirPhil Express is under one management oly, public percieved that AirPhil’s service is the same to PAL, thus making it as one of the reasons why despite the low cost and quality service brought by AirPhil it is still number. 2 in the industry.

Different celebrity will be invited to have a testimonials about AirPhil Express and its new campaign which is the “Juan’s Journey”. If the target audience be able to read and see the testimonials of the celebrities , it will somehow influence their perception about AirPhil Express. Its aim is to make the public realize that eventhough AirPhil express is in the same management with the PAL, whatever issues that PAL is having right now it doesnt influence the quality of service AirPhil Express offers.

SAMPLE:

In terms of Celebrity TestimonialsPRICE Kris Aquino “ It’s the most affordable flight ever!”

Ruffa Gutierrez “AirPhil is the only one where I’ve experienced less expenses.” Charlene Gonzales

“AirPhil is not as luxurious as other airlinesd because it provides affordability that every Filipino must experience but the best of ther quality service is still there.”

SERVICE QUALITY

Toni Gonzaga “Stewardess in AirPhil are so courteous and nice that they always ask you if you’re ok and what else do you need.”

Anne Curtis “From time to time, the board crews take good care of all the passengers. Their treatment are fair to all. Hindi yung porket artista ka, ikaw na uunahin nila. That’s one of the best things in AirPhil.”

Jose & Wally “Walang katulad ang AirPhil. Dito ka lang makakakilala na mura na yung fare, maayos at maganda pa ang mga facilities. Hindi kayo magsisisi dito.”

John Lloyd Cruz

“In terms of the ambiance, magaan sa pakiramdam, maliwanag, comfortable, relaxing, smooth ang byahe.”

PROMOTION (Juan’s

Angel Locsin “As it promotes Juan’s Journey, napakita ng AirPhil Express na leading domestic airline siya talaga. Not just in terms of theri

Journey Campaign)

profit but their goal and motivation for every Filipino to first patronize travelling domestically.”

Piolo Pascual “I treasure being a Filipino and AirPhil has helped a lot adding that value to me.”

Kim Atienza “Nationalism. That’s what AirPhil Express’ campaign Juan’s Journey wants to teach us.”

Media:

Television – Infomercial GMA News TV (Ch.11) ABS-CBN GMA

Magazines

F. DIRECT MARKETING

RATIONALE/SIGNIFICANCE:

Continuing their onslaught on the budget air travel market, Airphil Express has focused on expanding its route offerings and service quality. With the growth momentum, forward booking are very strong and expects to continue aggressive network expansion.

Due to the saturation of the media by so many competing airlines, the simple approach to advertising is no longer as effective as it used to be. There simply is too much "noise" to contend with in both the print and broadcast media when one has to get a message across. This is why direct marketing is considered necessary to achieve their said expansion.

Using direct marketing will enhance product image to attract more consumers which is one of the IMC objectives. Different direct marketing strategies and media will encourage repeat purchases to the company’s product and services which may result to establishing the company to be the market leader.

STRATEGY EXPLANATION:

Telemarketing: Direct marketing that involves calling people at home or at their work to ask for sales and information purposes.

Email Direct Marketing: This form of direct marketing targets consumers through their Email accounts. Email addresses can be harvested from websites, forums, or purchased. Some companies require you to receive announcements to use their websites.

Direct Mail Marketing: Advertising material sent directly to home and business addresses.

MEDIA:

Inserts in newspapers and magazines.

Customer care lines.

Catalogues.

Internet and New Media.

The Internet and New Media (e.g. mobile phones or PDA's<personal digital assistant>) are perfect for direct marketing. Consumers have never had so many sources of supply, and suppliers have never had access to so many markets.

Many companies use direct marketing, as p0art of a business model, which is used by low-cost airlines. There is no intermediary or agent. Customers book tickets directly with the airlines over The Internet. Airlines capture data that can be used for marketing research or a loyalty scheme. Information can be processed quickly, and then categorized into complex relational databases.

Then, for example, special offers or new flights destinations can be communicated directly to customers using e-mail campaigns.

G.ADVERTISING

SCHEDULE OF ADVERTISEMENTS

Duration/ Published Date

Program/ Size of print ad

Day/ Timeslot Total Spots/ No. of Ads

Station/ Publication/

Location

TV

12 weeks Showtime Mon-Fri 11:30-2:30pm 36 ABS-CBN8 weeks WalangHanggan Mon-Fri 9:00-9:30pm 16 ABS-CBN

12 weeks Eat Bulaga Mon-Sat 12:00- 2:30 pm 36 GMA 78 weeks Party Pilipinas Sunday 12:30-3:00pm 8 GMA 7

RADIO

20 weeks The Wake Up Show

Mon-Fri 6:00-10:00am 40 Love Radio 90.7

12 weeks The Afternoon Cruise

Mon-Sat 2:00-4:00pm 36 Love Radio 90.7

16 weeks The morning Rush w/ Chico and Delamar

Mon-Fri 6:00-10:00 am 32 Yes Fm 101.1

On Demand w/ Boom & Mia

Mon-Fri 9:00-12:00 pm Magic 89.9

The Playground with Tyler

Saturday 10:00-12:00 pm

Magic 89.9

BROAD SHEET

January 5, 2013

One fourth ad Saturday 1 Manila bulletin

January 19, 2013

Floating ad Sunday 1 Philippine star

January 28, 2013

One half ad Monday 1 Philippine daily inquirer

MAGAZINE

January 2013 Full Page ad 1 Good House Keeping

April 2013 1/3 page vertical 1 Good House Keeping

BILLBOARD

150 days Regular Billboard 1 Edsa P.

Tuazonblvd. Quezon City

150 days Regular Billboard 1 EDSA cor. Libertad St.,

Mandaluyong270 days Regular Billboard 1 North Luzon

Expressway (Northbound)

120 days Regular Billboard 1 Cebu City Arch Reyes st. Cor.

Gorordo180 days LED Board 1 EDSA Guadalupe

SHED AD

30 days Shed Ad 1 EDSA after Jollibee Kamias

30 days Shed Ad 1 Libis across Mercury

Calendar of Activities2014

What Who When Where BudgetLaunching of the campaign Juan’s Journey and Sales Promotion which is the Juan to Twelve

Alfredo Herrera, Senior VP for Marketing and Sales

2nd week of January

Manila Marriott Hotel

Sales Promo for January: “Juan Loves you”

2nd week of January

Publicity of the held event

3rd week of January

Sponsorship (Palarong Pambansa Qualifying Rounds)

January - March Luzon, Visayas, Mindanao

Advertisements:NewspaperMagazine - January issueRadioBillboards

All Sundays of JanuaryJanuary

January – AprilSales Promo for February: “The Juan for You”

February

Sponsorship PSC-LGU Sports Summit

February 23-24 Ninoy Aquino Stadium, Manila

Direct Marketing FebruaryAdvertisements:Magazine – February issueRadio

February

Sales Promo for March: “March with Airphil”

March

Sponsorship(2012 Corporate Games)

March 22-25 NCR

Advertisements:Magazine – March

issueRadioNewspaper

March

3rd week of MarchSales Promo for April: “ Airpril”

April

Advertisements:NewspaperRadioMagazine – April issueBillboards

1st Sunday of AprilApril

April – July

Sales Promo for May: “Santacruz-Juan”

May

SponsorshipPalarong Pambansa

POC-PSC National Games

May 6-13

May 26 to June 3

Lingayen, PangasinanDumaguete City

Direct Marketing 3rd week of MayAdvertisements:Magazine – May issueRadioNewspaper

May

All Sundays of May

Sales promo for June: “Balik eskwela si Juan”

June

SponsorshipWomen in SportsPSC-AFP Olympics

June – SeptemberJune – September

Advertisements:Magazine – June issueRadio

June

Sales Promo for July: “Juan Peso”

July

Advertisements:NewspaperRadioBillboards

All Sundays of JulyJulyJuly – October

Sales Promotion for August

August: “Bayani Ka Juan”SponsorshipNational Milo Little Olympics

August – November

Direct Marketing AugustAdvertisements:RadioNewspaper

August3rd week of August

Sales Promo for September: “Juan Family”

September

SponsorshipBatang Pinoy Southern Luzon leg for Regions 4a, 4b & 5

September 30 – October 3

Mindoro

Direct Marketing SeptemberAdvertisements:RadioNewspaper

SeptemberSaturdays and Sundays of September

Sales Promo for October: “Number Juan Si Titser”

October

SponsorshipBatang Pinoy NCR legBatang Pinoy Northern Luzon leg for Regions 1-3 & CAR

October 14-17October 28-31

MarikinaPampanga

Advertisements:Magazine – October issueRadioBillboards

October

October 2014 – January 2015

Sales Promo for November: “Trip or Treat”

November

Sponsorship

Batang Pinoy Mindanao leg for Regions 9-12, Caraga & ARMMBatang Pinoy Visayas leg for Regions 6-8

November 11-14

November 25-28

Cagayan de Oro City

Cebu City

Direct Marketing 3rd week of November

Advertisements:RadioNewspaper

NovemberAll Sundays of November

Sales Promo for December: “Blast of 2014”

December

SponsorshipBIMP-EAGA Friendship Games Batang Pinoy 2014 National Finals

December 8-11

December 9-12

General Santos City Iloilo City

Advertisements:Magazine – December issueRadioNewspaper

December

Saturdays and Sundays of December

Source: http://www.psc.gov.ph/