13:Do you think AirGo should target a different market segment? Justify your answer.[6]

[Dania]

AirGo is a market-orientated business. It provides flights to 10 airports across Asia. 90% of its customers are people going on holiday. AirGo only advertises in national newspapers. The Marketing Director is worried that demand for AirGo’s flights is price elastic. Last year revenue fell due to increased competition. She wants to target a different market segment such as business customers. She does not know how new legal controls to protect the environment might affect AirGo.

13:Do you think AirGo should target a different market segment? Justify your answer.[6]

Possible KN Points:
>Different customers may have different needs.
>Wider market.
>Need to advertise to potential customers.
>Cost of market research.
>Reaction of existing competitors.