¶ … Business Model Examination of easyGroup's External Environment

Often, achieving competitive edge in an industry has less to do with a company's specialized set of resources, its innovative processes or its unique branding identity and has far more to do with its capacity to recognize needs in the market and find ways to satisfy them. Such is to say that where competitive edge is typically regarded as something attributable to the internal qualities of an organization, sometimes competitive edge may be devised simply by observing the market, identifying its biggest voids and filling these in a strategically sound matter. These externalities are most responsible for the competitive edge sought by easyGroup, purveyor of the no-frills, low-cost airline easyJet and aspiring purveyor of a business called easyCinema that would feature many of the same qualities applied in a different industry.

For easyGroup, the decision to create the business segment in question emerged from...

Indeed, easyGroup would observe a rising demand amongst British film-going audiences for a more price-effective way to enjoy an evening at the theatre. The fact that no such option existed, easyGroup believed, was the result of a market inefficiency that could be resolved with the presence of a forward-thinking firm. According to the present case study, "the group's CEO, serial entrepreneur Stelios Haji-Inannou, aimed to replicate the success of easyJet, the low cost airline that he had established in 1995, by creating a similar no-frills concept in the cinema industry. The millionaire businessman's stand was, 'Nobody has tried to do this and I am told covert practices abound that prevent cinemas cutting prices. Current prices are far too high -- they put people off going to the cinema.'" (Doz, p. 57)
Here, the CEO of easyGroup described a set of externalities created by the marketplace…