The Transformation of Virgin Australia into a Full-Service Airline
Virgin Australia, established in 2000 originally as Virgin Blue, has undergone a significant transformation from its roots as Australia’s pioneering low-cost carrier (LCC) to becoming a prominent full-service airline. This strategic shift, initiated with a rebranding in May 2011, was aimed at capturing higher-yielding corporate traffic while retaining its stronghold in the leisure market.
The airline’s evolution involved a complete overhaul of its business model, focusing on a dual-brand strategy similar to that of its competitor Qantas. This was underscored by its 2014 acquisition of Tigerair Australia, a domestic LCC which ceased operations in 2020, allowing Virgin Australia to diversify its offerings and enhance market penetration.
Additionally, Virgin Australia expanded its operations through subsidiaries like Virgin Samoa (formerly Polynesian Blue) and Virgin Australia Regional Airlines. However, in 2018, the partnership with the Samoan government ended, prompting the re-establishment of Samoa’s own flag carrier.
A significant component of Virgin Australia’s strategy has been its Velocity Frequent Flyer program, which became fully owned by the airline in November 2019 after purchasing the remaining shares from Affinity. This loyalty program is a critical element in its business model, aimed at enhancing customer retention and boosting revenue.
The journey has not been without challenges. In April 2020, Virgin Australia Holdings entered voluntary administration amid financial struggles. However, a new chapter began in November 2020, when Bain Capital acquired the airline, marking a pivotal moment in its restructuring efforts.
Today, Virgin Australia continues to adapt and innovate within the competitive aviation industry, striving to balance between premium services and operational efficiency, reflecting its unique journey from an LCC to a full-service carrier.
Related news: https://airguide.info/?s=Virgin+Australia
Sources: AirGuide Business airguide.info, bing.com, Virgin Australia