Services Marketing Essay Example | Topics and Well Written Essays - 3500 words

Services Marketing - Essay Example UK bus industry having about 9000 licensed bus companies now supports about 170,000 odd jobs. There are about 22000 bus services registered within UK. Stagecoach comprises of one of the largest bus operators in UK. It runs about 8100 buses and employs around 35000 staff. It is also engaged in providing rail and tram services in UK. Size The daily travel density across the country is about 2 million people. Major competitors for the concern include Cowie, FirstBus, Arriva, West Midlands Travel, National Express, First and GoAhead. Other competitors include international bus service agencies and independent operators (Arriva. 2013). Competitive Structure Since 1985, the bus industry has seen a growth that is remarkable. Presently, 4 of the major bus operators, namely, Cowie, FirstBus, Stagecoach and West Midlands Travel have more than 50% market share. However, the typical market structure specific to a bus industry is that unlike other manufacturing and service concerns, bus service i ndustry focuses majorly on numerous local markets. The local market is evidently the large urban areas (Tsiotsou, and Goldsmith, 2012). What is also striking about the market is that each one of the big 4 operators has almost equal market share with none having a significant market presence in all of the regions. If any of these big four operators want to become a market leader, they would necessarily need a very aggressive marketing strategy to acquire the market of other competitors. Competition is very limited because each one has its own market niche and customer set (Competition Commission, 2013). Opportunity and Threat Analysis Opportunities: Acquisitions Stagecoach is operating in a market where there are primarily three major competitors, namely, Cowie, FirstBus and West Midlands. Here, each bus operator has almost equal share in the industry ad each one acts as a major market player. Competition is faced by these 3 bus operators alone; rest smaller operators do not pose sig nificant threat (Reuters, 2013). This is because the bus market in US is geographically segregated. Each player has his set and defined market area. Players do not compete in each other’s defined territories. This culminates in what is known as a lack of head to head competition. Bus operators are running excess profits because of lack of competition in their area of operation. Cities like Oxford, Nottingham and Sheffield were among the few places where there was some sort of competition observed (The Courier, 2012). With a view to become a market leader and overcome such competition, Stagecoach can employ a consolidation strategy. It can expand its operations, and thereby market share by a series of acquisitions of smaller bus operators. With such acquisition based expansion, benefits to passengers will be felt directly in the form of falling prices, better services and higher frequencies. As for the firms, intense rivalry shall lead to one large firm being replaced by the o ther such that it leads to complete shutdown of the weaker firm (ReportLinker, 2013). Emerging markets and expansion abroad Stagecoach operates majorly in UK and is expanding its operations in USA, NewZealand and Canada. Emerging nations like Brazil, China, India and Indonesia are countries full of growth opportunities. Expansion of bus services in these countries would be a great business opportunity. Countries like China and India have a huge