Opodo SWOT-analysis

Opodo as a business has now been analysed and we have looked at the environment around the company and the industry. It's therefore now time to summarize it in a SWOT model.

Analysis of the business environment of Opodo

Key trends

• Increasing trends of using apps and alternative ways for people booking travels on the mobile etc. which could be a threat for Opodo.


• Smartphone penetration is expected to reach 92% in Europe by 2014 with mobile phones set to overtake PC’s as the most common web access device worldwide.


• There will be power shift from search engine to smartphone manufactures.


• The first consumers using the smartphone were business travelers but now the leisure consumers are also catching up.

• Green environment. Consumers’ interests for the green environment are still increasing and the consumers not only want to improve themselves through fitness, healthcare etc., they also wants to improve others and the environment.


• An important development for Opodo is that there is a rise of travel and tourism reservations through social networks applications such as Facebook etc. It has already been shown that a markeeting tool as Facebook is important and idicates higher sales both for the companies in travel and tourist industry.


• Travel retails are expected to stagnate because of the past global economic crisis.


• Europen travel and tourism and week performance because of the crisis.



• Traditional airlines are becoming more and more similar in strategy with the budget airlines, using extended service offerings.


• The future trend in the hotel industry looks similar to the above mentioned, more and more hotels are charging for extended services.
  

Industry forces

• The competitors are other companies doing the same as Opodo, like ebookers etc. But it’s also the hotels, fly companies, car rentals and travel agencies.


• Travelmarket has introduce a "charge measure" for thier customers.


• The new entrants in the market are the travel companies focusing on new technology to use in the industry. (As we identified in key trends)


• The substitute products and services are the same as the competitors.


• It can also be some alternative travel agencies for the costumers there want to experience unusual destinations and more challenging activities when traveling.


• The same as the competitors and the substitute products and services.


• Workers – employees. Important to keep the good relationship with the customers.


• Shareholders – the biggest are: Amadeus 55.36% and Air France, British Airways and Lufthansa 10.24% each.


• As well the IATA has made a promise to cut the carbon dioxide emission by 50% unto 2050.


• Tourist industry is as well working strong with SCR.

Macro Economic forces

• GDP is stagnating.


• Increased unemployment.


• Indication of a huge future demand for employees to the airline industry.


• Oil price increasing which leads to more expensive flight tickets. This is a vital factor since the cost of fuel stands for 1/3.


• From the start of 2012 the EU airlines will need to pay for their emissions. Which can lead to more expensive air travel.

Market forces

• The major key issue for Opodo is the huge shift in the way consumers have to search and book their travel.


• The biggest growth potential is in the leisure segment ( arrow from the key trends to the market segment)


• Because of the costumer’s opportunity to compare prices on the net, it’s important for opodo to keep searching for the best package for their customers.


• The customers wants an easy and fast way to book their.


• The switching costs are high because of the key issue described in the “market issue”.


• Because the costumers easily can find and purchase cheaper products and services, the largest margin for Opodo could be archived in the relationship to the customers. To hold on to the loyal customers they have to keep developing the good relationship with both the business and the private customers through customer contacts and services and their customer club.


• Further trends in the airline industry is increased demand for employees and airplanes. Which indicates of a good future for airplain makers such as Airbus and Boing. The increase demand is mainly due to population growth (forecast of twice as many will be flying in 20 years). However, the profit margin for the industry lie only around 1% and are expected to decrease in 2012 to 0,8% because of oil price and country crises. Business customers are declining.
  

References
Opodo homepage
Ovum
Dagens Industri
IATA

Opodo Business Model

Why this company?
We wanted to analyze Opodo because the company is the leading online travel company in Europe. It operates in 9 countries and the company goal is to give the customer the tools and information to plan and book a travel, which here includes flight, hotel, car hiring etc. Compare to other companies in their field they also focus the business on the business segment and a high level of customer service.

Website?
http://www.opodo.com/

Business model description

Customer segments
Opodo has two types of customer segments, the private customers and the business customers.

Customer relationships
Compare to other companies in their field, they have a customer service team, especially to the business customers. So the customer service and the co-creation, describes the relationship they have to their customers. Besides that they have also self service, which many of their customers use. Opodo have also created a community for their customers with the blog ohMyGlobe.com.

Channels
There are two types of main channels, the first one is the sales force, handling especially the business customers and then there are web sales, where people can book trips online. Some other channels to mention are blog and newsroom.

Value proposition
Their main value proposition is "get more out of travel", and Opodo describes themselves as the best partner to do that. To support people in making the right travel decision they have a customer service team, there are available to help 7 days a week, which is another of their value proposition. Opodo have the knowledge and experience to give the right recommendation to their customers. They have a wide selection of travels and therefore they can provide their customers with made-to-measure state to some affordable prices because of their competitiveness with their prices.

Key activities
One of the most important key activities is the platform/software, because it's here the biggest part of the company is selling the travels. So without the platform there will be no business. Besides that they also have this service team doing customer support etc. Opodo have a lot of partners so one of their key activities is to take care of them and make sure that they maintain the good relationship with them.

Key ressources
To maintain Opodo’s most important key activities, the platform, they need some resources to do that, so therefore the it-system is one important key resource. And the same count for the service team, so the second important key resources Opodo have is customer supports.

Key partners
Opodo has many partners and the business depends in a high level of them. Some of the key partners are; airline companies, hotels, travel insurance, car hire agency and travel guides. They have chosen to partner with leading travel guides, to provide their customers with details on hundreds of worldwide destinations.

Cost structure
The main costs of Opodo are the people, because of the wages, partner cost and the last thing is to maintain the IT-system.

Revenue streams
Opodo's main source of revenue comes from the online sales and the customer service team sales.