Allegiant Travel (ALGT): Macro Environment Analysis of Allegiant Travel



Demographic:
The increasing amounts of individuals entering retirement is actually news that is great for businesses like Allegiant Travel who services are actually targeted towards pleasure travelers. The retired public typically has much more free time and flexible schedules for pleasure travel. The restaurant business has known for decades that the retired public will modify their schedules simply to save a dollar. Allegiant Travel is able to cash in on this particular population ‘s flexible schedules as well as interest in finding the perfect price tag. Twenty-one {2d2f44a84581e7faccb3258644ff0ea0b6a9621a7db020bd2ff986e7f0634d92} of leisure travelers have been created before 1946 and of the team it’s believed that they every take 4.1 trips per season. Additionally, previous baby boomers created between 1946 1954 makeups another fifteen {2d2f44a84581e7faccb3258644ff0ea0b6a9621a7db020bd2ff986e7f0634d92} of the pleasure travel public. As the U.S. public continues to age as well as the retired public grows it could be expected that the need for inexpensive leisure travel will even improve.

Economic:
The economy plays a crucial role in the wellness of all the businesses and not many can claim that these last five years have been simple. American’s are discovered to be thriftier right now compared to five years ago because of the economic recession. Generally, the dynamics of spending has transformed in America. They’ve focused on keeping expenses down and providing the services of theirs at probably the lowest price point. This particular emphasis on innovation and being a cost leader has furnished Allegiant Travel with a strategic edge over some other larger carriers. Although in many sectors the bigger the business the lower the costs as a result of economies of scale, this’s not the situation in the airline industry.

Socio Cultural:
The travel business groups travelers into one of 2 groups either business or leisure. Each kind of traveler has very different goals and unique needs in mind aside from the drive to have a secure enjoyable flight experience. It’s believed that pleasure travelers account for 3/ four of all the domestic trips had in 2011. This’s the industry that Allegiant Travel is actually focused towards as they’re the reduced price leader that operates variable schedules throughout the time of year to make certain flights are constantly running to the fullest capacity of theirs.

Political-Regulatory:
The extra security measures mandatory for travelers after 9/11 may be a significant factor behind the improved frustrations voiced by travelers. The U.S. Travel Association ‘s research in 2008 proved that travelers stayed away from approximately forty one million trips within a twelve month period because of to perceived air travel inconvenience. Although airlines like Allegiant Travel don’t have control over just how Homeland Security does the job of theirs they’re in a position to lobby for more effective airport security that can in turn help boost the profits of theirs.

Environment:
The increase in environmental consciousness affects traveler’s decision making. Over seventy nine {2d2f44a84581e7faccb3258644ff0ea0b6a9621a7db020bd2ff986e7f0634d92} of U.S. grown ups claim to be familiar and environmentally-conscious with global warming and carbon footprints. The current determination is actually that in common, driving is a lot more green (measuring green house gases) in contrast to flying.

Technology:
The expansion of access to info through the web over the years has produced savvy shoppers that could compare dozens of prices fast on the internet and has produced more focus on cost competition. The web has additionally reduced the dependency on traveler’s using travel agencies to set up travel as they think a lot more comfortable booking right online. This places Allegiant Travel at an edge as they’re in a position to provide prices that are competitive through booking straight with the clients and staying away from some middle males such as for instance sites as Yahoo.com or Expedia.com.

To conclude, Allegiant Travel is a good business which is strategically positioned to flourish in any environment. They’ve shown the agility of theirs in changing with the market need during the last 6 years. Allegiant Travels concentrate on servicing the cost conscious traveler appears to be a sensible strategy as they understand that customers are now uncertain with their spending while as the economy is actually improving. The expected boost to the retired public in the coming years will even bode very well for Allegiant Travel.

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