Adapt Or Die
Most companies die and fail to adapt as they have a lack of vision and foresight. Another issue is they leave it too late to diversify as they have depleted the funds they once had.
Over the last two years businesses have been forced to adapt or die thinking differently expanding their horizons. I know we have had to change over 60% our entire clientele base trimming out those that were deemed as high risk. Other businesses have really had to think out of the box which could actually turn out more profitable than the original business ever was.
Air Asia is a budget airline based out of Kuala Lumpur, Malaysia and like most airlines around the world has run into financial difficulties. There is no quick fixes as what do you do when your airline is grounded due to lockdowns and no passengers? No problem as the owners started a Venture Capital group that would fund 500 startups to help them remedy the shortfalls of lockdowns.
The budget airline decided to enter e commerce last year offering far more than cheap travel. Diversifying so much it actually blew my mind what they are involved with now. Those 500 startups have come in handy as they are rolling out various services making much needed revenue. This actually makes so much sense for the long term as their brand has grown just by the footprint they are now offering.
The airline is offering discounts and incentives by reward points which can be spent on any of their businesses within their app.
The airline now will still keep it's name but fall under a much bigger umbrella called Capital A. Capital A offers so much besides fintech and travel and have an entire new eco system that has been developed. You are limited only by your vision and these forced changes to the normal have had massive implications resulting in success or failure.
I could not see our local airline changing like Air Asia has as the local airline is that incompetent. Air Asia is privately owned which means they have skin in the game which is an important factor as you have to help yourself.
First up they created a super app which houses all the non airline business alongside the normal flight bookings and info. Because they have such a big footprint as an airline in the region they have had over 75 million app downloads from Malaysia, Thailand and Singapore. This is now a multi country business ready to expand and roll out. A one stop shop for travel and lifestyle.
Car hire was an obvious business expansion along with a shuttle/taxi service to and from the airports. Throw in accommodation with hotel bookings and that you would think would b about it but no there is way more. fast food delivery service, online grocery shopping, shopping via their ecommerce platform from jewelry and cosmetics to books and toys similar to Amazon. That was the easy bit as they had duty free before so adding this was obvious by expanding what they had. Not sure about what duty free as most counties wouldn't allow alcohol and cigarettes on home delivery duty free as that would be a too good to be true scenario so must mean everything else plus the duty included.
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Banking., healthcare, internet for the home as they already had service providers selling to passengers on board their flights. Insurance as they already provide travel insurance so why not normal home and health insurance as again they have the contacts in place with their current service providers.
What I think will work for this business over many others is travelers use them as they are known for their cheaper tickets. That mindset could change many customers who are looking for home internet services or groceries for the home. The customer base is already in place by what they do as a normal airline business. Whatever happens to Air Asia they have given themselves a good crack at survival and growing into something far bigger than just an airline.
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That's my biggest fear for my own business, not being able to adapt quickly enough to the needs of the market. I try to reïnvent the business every day, but it's hard as the world of finance is changing very abruptly... But so far we are managing well!