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INTO the MARKET in the SLOVAK REPUBLIC Natália Stalmašeková

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INTO the MARKET in the SLOVAK REPUBLIC Natália Stalmašeková MARKETING IDENTITY THE ENTRY OF A FOREIGN COMPANY (‘THE NEW BRAND’) INTO THE MARKET IN THE SLOVAK REPUBLIC Natália Stalmašeková – Jana Štofková Abstract The entry of any company into the market always brings certain risks and unpredictable events, even if it is a well-known brand with an established reputation. The company must be able to assess entry barriers into its new market and be able to overcome them effectively. At first sight, the Slovak rail passenger transport market could seem a disadvantageous area for new entrants. Železničná spoločnosť Slovensko, with the state as 100% shareholder, had a monopoly on this market and on top of that, this company provided unpaid transport for chosen segments of passengers. Another drawback is the poor condition of the track network, which affects the speed of transportation. However, a successful company should be able to use these conditions for its own benefit and bring change and innovation to such an industry. The Czech company RegioJet inc, has decided to enter this sector and try to entice Slovak passengers with its services, which have not yet been offered by anybody else. Key words: Marketing research. Rail passenger transport. RegioJet Inc. Introduction The end of 2014 brought big changes for the Slovak rail passenger transport market. On November 17th, the state began to cover the full cost of tickets for selected passenger groups, which caused a significant increase in passenger numbers from these groups. On December 14th, the Czech private company RegioJet began a service on the Bratislava – Žilina – Košice line. Until that date, Železničná spoločnosť Slovensko was the single carrier in rail passenger transport on this route. The Bratislava - Žilina - Košice route is a key one for rail passenger services in Slovakia, as it connects the eastern with the western part of Slovakia. RegioJet entered the market with a guarantee of lower prices and higher quality than was offered by Železničná spoločnosť Slovensko. It also began the track service with concerns about how the state endowment would influence the decisions of passengers and whether it could successfully compete with the Slovak company. For the passengers, the entry of RegioJet meant awaking from the ‘apathy’, which they experienced when traveling with ZSSK, because without the competition the state company was not pushed to improve the quality of travelling and decrease the prices. With its entry, RegioJet promised modern, yellow trains, which offered high standard travelling for low prices. In the survey, we were looking to see if the well-known Czech brand established itself in the Slovak market successfully. 1 Methodology and goals The goal of the paper is to analyse, on the basis of primary research, the success of entry of the Czech company RegioJet into the Slovak market of rail passenger transport on the Bratislava – Žilina – Košice route. The paper provides an overview of the RegioJet services and comparison of ticket prices, which both companies offer. In conclusion, we summarise the survey results. 276 CONSUMER AND BRANDING THE ENTRY OF A FOREIGN COMPANY (‘THE NEW BRAND’) 2 The origin and history of RegioJet Inc. company INTO THE MARKET IN THE SLOVAK REPUBLIC RegioJet Inc. company is a sister company of Student gency holding, Inc. Student Agency, s.r.o company was first founded in 1 by the owner of RegioJet. Its Natália Stalmašeková – Jana Štofková business focus was the provision of au pair services in Europe and the USA, of language programmes, educational programmes abroad, work programmes, and bus Abstract The entry of any company into the market always brings certain risks and unpredictable events, even transport. It was gradually etended to the business of ticket sales and domestic bus if it is a well-known brand with an established reputation. The company must be able to assess entry transport. The company kept growing, gaining new employees and reinforcing its barriers into its new market and be able to overcome them effectively. At first sight, the Slovak rail position among customers.1 RegioJet Inc. Company was founded in 200 in rno and passenger transport market could seem a disadvantageous area for new entrants. Železničná entered into the rail passenger transport market of the Czech Republic. In 2010 spoločnosť Slovensko, with the state as 100% shareholder, had a monopoly on this market and on top RegioJet dispatched its first train on the Decin and Krupka route. In 2010, the of that, this company provided unpaid transport for chosen segments of passengers. Another drawback is the poor condition of the track network, which affects the speed of transportation. Commercial Register of the Slovak Republic registered RegioJet Inc. Company, with However, a successful company should be able to use these conditions for its own benefit and bring its residency in Bratislava.2 In 2011 the Czech carrier started to dispatch intercity change and innovation to such an industry. The Czech company RegioJet inc, has decided to enter this trains on the Praha – Ostrava – adca – Žilina route. In November 2014 RegioJet sector and try to entice Slovak passengers with its services, which have not yet been offered by extended the Prague – Žilina route to Košice, and in December it entered the main anybody else. Slovak Bratislava – Žilina – Košice route. Besides organizing rail transport in Slovakia, RegioJet organizes bus transport on the Banska Bystrica – Nitra – Bratislava Key words: Marketing research. Rail passenger transport. RegioJet Inc. and Bratislava – Vienna routes. 2.1 Services offered by Regiojet Inc. Introduction RegioJet intercity trains offer transportation in first and second class carriages. The end of 2014 brought big changes for the Slovak rail passenger transport market. Passengers can choose from the three types of tariffs: standard, relax and business. On November 17th, the state began to cover the full cost of tickets for selected On the Bratislava – Žilina – Košice route, the company sends off three pairs of trains passenger groups, which caused a significant increase in passenger numbers from daily. The price of ticket depends on the type of tariff, time of departure and type of these groups. On December 14th, the Czech private company RegioJet began a service discount for various classification of passenger. on the Bratislava – Žilina – Košice line. Until that date, Železničná spoločnosť Table 1: Price of tickets on the Bratislava – Žilina – Košice route at a specific time (for example Slovensko was the single carrier in rail passenger transport on this route. The Friday 5:33 pm.) Bratislava - Žilina - Košice route is a key one for rail passenger services in Slovakia, as Tariff Adult Student it connects the eastern with the western part of Slovakia. RegioJet entered the Standard 1,0 ,0 market with a guarantee of lower prices and higher quality than was offered by Relax 1 Železničná spoločnosť Slovensko. It also began the track service with concerns about Business 2,40 11,70 how the state endowment would influence the decisions of passengers and whether Source: STALMAŠEKOVÁ, N.: Analysis of the competitive environment in the rail passenger transport on it could successfully compete with the Slovak company. For the passengers, the entry the Bratislava – Žilina – Košice route. [Master thesis]. Bratislava : University of Economics in Bratislava, of RegioJet meant awaking from the ‘apathy’, which they experienced when traveling 201, p. with ZSSK, because without the competition the state company was not pushed to Table 2: Price of tickets on the Bratislava – Žilina – Košice route at a specific time (for example improve the quality of travelling and decrease the prices. With its entry, RegioJet Friday 05:33) promised modern, yellow trains, which offered high standard travelling for low Tariff Adult Student prices. In the survey, we were looking to see if the well-known Czech brand Standard 4,0 established itself in the Slovak market successfully. Relax 14,0 7,40 Business 2,40 11,70 Source: STALMAŠEKOVÁ, N.: Analysis of the competitive environment in the rail passenger transport on 1 Methodology and goals the Bratislava – Žilina – Košice route. [Master thesis]. Bratislava : University of Economics in Bratislava, 201, p. The goal of the paper is to analyse, on the basis of primary research, the success of entry of the Czech company RegioJet into the Slovak market of rail passenger transport on the Bratislava – Žilina – Košice route. The paper provides an overview 1 História spoločnosti Student Agency. online. 201-11-20. valiable at: of the RegioJet services and comparison of ticket prices, which both companies offer. <http://www.studentagency.sk/o-nas/profil-spolocnosti/historie-spolecnosti/>. 2 FinStat s.r.o. – Databáza firiem. online. 201-11-20. Avaliable at: In conclusion, we summarise the survey results. httpwww.finstat.sk4721271. 277 MARKETING IDENTITY 2.2 SWOT analysis of the RegioJet Company Using the SWOT analysis, the company can create an overview of the challenges and opportunities of the industry in which it operates and effectively assess its strengths and weaknesses. RegioJet's success with consumers will depend on the success of overcoming challenges from the external environment and eliminating weaknesses. The company in Slovak market will continue to grow if it can take advantage of opportunities in the industry, by using its strengths.4 Figure 1 shows the strengths and weaknesses of RegioJet, opportunities in the eternal rail transport environment in Slovakia and market risks. •Good name of the brand. •Quality of services. •Price of services. Strengths •Comfort of transportation. •Return policy. •Ticket price. •Failure rate of trainsets. •Absence of back-up trainsets. •Absence of dining carrier. Weaknesses •Weak WIFI signal in the train. •Frequent malfunction of toilets, heating and air- conditioning. •Entry to the new routes. •More lines on the route BA – KE. Opportunities •Adding carriers to existing carriers. •Overcrowding of car traffic. •100% discount for certain passengers. •Track closures – frequent delays.
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