How To Provide High Value In Competitive Markets

In a recent survey, Singapore Airlines was named World’s Best Airline by Conde’ Nast. The remarkable thing about this is that Singapore has won this award 21 of the 22 times it has been awarded. How has Singapore been able to consistently provide such excellent service and maintain a good level of profitability for so many years? How have they developed the capability to provide excellent value for so long?

Earn The High Value From Competitive Markets

Singapore Airlines operates one of the youngest fleets in the world. Newer airplanes have a number of benefits for both operators and customers. Because the planes are newer, they are usually more reliable, having fewer breakdowns than older planes. Because the planes are newer, they will likely be more efficient to operate than older ones. And because the planes are newer, customers will have up-to-date amenities and comforts, thus having a more enhanced travel experience.

Earn The High Value From Competitive Markets

Singapore also invests heavily in training its staff in all aspects of operating the airline. The people of Singapore Air are trained to deliver excellent service in the cabin, on the ground, and in the terminal. Singapore actually has one of the lowest costs of operations of any airline, with a cost below 7.5 cents per seat mile, which is actually below many of the so-called budget airlines. What is interesting is that Singapore actually staffs each flight with more than competing airlines. They provide superior service on every flight. Among frequent fliers, the reputation of Singapore Air is outstanding!

One more factor: Singapore runs the entire operation with a very small corporate staff. Their administration costs are among the very lowest in the industry. This helps the profitability of the airline as well.

What is the point we are making here? Simply put, in order to compete and compete well in an extremely competitive marketplace, a company must provide service and value at an appropriate price. People will pay for results that reach their expectations. This is true at every level of service and value. For poor or minimal service, people expect to pay only a modest amount, so the perceived value is commensurate with the price paid. For more exceptional service, with the perceived higher value, a company may realize a higher price and/or become the supplier of choice. On occasion, one will encounter a company like Singapore Airlines that provides exceptional service and exceptional value, all at a competitive price.

How is this to be accomplished? By focusing its efforts on those parts of the business which add value, and minimizing or eliminating those parts of the operation which do not add value or for which customers won’t pay, a company can be seen as exceptional. This may be done across the spectrum of price and features, in commodity markets and specialty markets. Excellence and attention to what really matters to the people who purchase your service or products are some of the keystones of a successful strategy. As you develop your strategic plan be sure that you identify what differentiates you in the market in your customers’ eyes.