AST21617 Tutorial 5

In recent years, marketing has developed 7Ps from 4Ps.

1. What is 4Ps marketing mix?

Answers:
4Ps: Product, Price, Promotion and Place (distribution).

2. And briefly discuss the extra 3Ps.

Answers:
Extra 3Ps: Physical environment, Process and People are very important in services delivery.

Physical environment It is the elements within the store -- the store front, the uniforms employees
wear, signboards, etc. Services providers aim to incorporate certain tangible
elements into their offerings to enhance customer experience.
People It is related to the employees of the organization with whom customers
come into contact.
Process It is the processes and systems within the organization that affects its
marketing process. It is important in service delivery in order to ensure the
delivery standard of the services.

Read the article “Airlines: full service versus low cost carries - the value for money equation” and
answer the following questions.

3. Why is value considered as a “subjective” concept?

Answers:
• This is because it is up to passengers themselves to determine what constitutes value in their
minds - for some it is getting a great price, for others it’s flexibility of schedules, or in-flight
product and service, entertainment and so on.

4. How can low cost carriers deliver their “value for money”?

Answers:
• LCC gives passengers the option to choose the extras that are important to the passengers added
to a base fare, which they believe can provide “the best flight experience possible”.

5. According to the concept of value proposition, why are full service carriers charging a higher
price?

Answers:
• This is because FSCs are offering products with higher value, like quality service from check-in
to superb onboard services, and value increases with quality and service and results in a higher
price.