Week 2 Question Q2

2. Explain KiwiAir’s competitive strategy in terms of ONE of the forces in Porter’s Five Forces model.

The potential threat of new entrants is high for the airline industry. With the previous deregulation of the industry there were many new entrants entering with a low cost strategy and there is still a high possibility of more new entrants in the market. This strongly effected KIWIAIR’s market position and strategy. KIWIAIR’s new strategy is to compete on customer service and customer loyalty from the restructured existing loyalty program. They are also using their size advantage and flexibility to change their position to better suit the needs of their customers. This should create higher barriers to entry for new entrants and help KIWIAIR keep its market position.

By Jessica Davey