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ManagementBrand PositioningFashionAdvanced2010
Burberry: Luxury Digital Transformation
The challenge
Michael O'Leary took over Ryanair in 1991 when it was losing money competing with Aer Lingus and British Airways on full-service routes. He needed to find a model that could profitably serve price-sensitive European travelers who were priced out of air travel entirely.
The strategy
O'Leary studied Southwest Airlines and created Europe's most extreme version of the low-cost model. Every possible cost would be eliminated and every possible ancillary revenue stream would be monetized — the base ticket was just the beginning.
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Try the full case free →Key lessons (preview)
- Unbundling a product to its base price and charging for everything else can unlock enormous price-sensitive markets.
- Secondary airports charge airlines dramatically less and can still serve the same markets.
- Being the price leader in a commodity market creates a structural advantage when costs are genuinely lower.