indian aviation price wars & more

7/31/2019 Indian Aviation Price Wars & More

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INDIAN AVIATION: PRICE

WARS & MORE

GROUP-7

DIPANJAN DE

EKTA SHARMAAKASH VASHISHTHA

MOHIT GUPTA

BHANU SINGH

KAUSTABH DALAL


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Examine the innovative schemes initiated by three

airlines in 2002. JET AIRWAYS

It offered the frequent flyer scheme called Jet privilege schemeunder three different levels; JP Blue, JP Silver, JP Gold depending

on number of miles flown. J A also tied up with various hotel groupslike the Oberoi Hotels and Radisson.

INDIAN AIRLINES

APEXAdvanced Purchase Excursion under U can fly campaign.

Wings of freedomOffered unlimited travel for 7 days within thedomestic network for both economy class and business class

Bharat Darshan tourUnlimited travel for passengers throughoutIndia on purchase of tickets worth more than Rs 80000.


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SAHARA AIRLINESSixer and Super Sixer schemesIt offered a six flight coupon ticket for

any six sectors and the main USP was that no advance booking wasrequired.

Steal a seatOnline bid scheme where base price was Re 1 and was

open for passengers flying 25 days later.

Bid n Win Intended to make travel exciting, interactive and

enjoyable by providing an opportunity to win a wide range of gifts.

Wings & WheelsComplementary AC coach services which provided

pick up and drop facility for passengers to the airport.


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Do you think promotional programs undertaken by

Airlines are likely to increase customer base andcontribute to corporate viability?

The answer is Yes, provided the company can properly integrate its

marketing strategies with overall long term as well as short term

objectives This could be justified by the following-

Integrating marketing strategies - Air Sahara which allowed 10 %commission to the ticketing brokers but at the same time it should also benoted that these agents do not take undue advantage and hamper the image

and position of the Airline in the views of customers.

Providing customer delight - Service standards should be well maintained

and should surpass customer expectations so that the company can attract

as well as retain the customers as in the case of Jet Airways.

Targetting the middle class segment -Thepromotion is necessary because

it is required to attract customers who were travelling by trains due to much

lesser fares and the flights were taken with empty seats to destinations.


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Is the intense rivalry exhibited through

price cutting(by industry participants) undermining their

viability in the long run?

No we do not think that the price cutting strategy will have an

adverse affect on their capability in the long run.

Price discipline - As long as price discipline is maintained

where pricing practices lead to cost recovery and profit

margins viability will not be a problem.

Strong passenger traffic growth- With the advent of pricingand other promotional techniques CAGR has increased from

13% to 19% during 2006-2011


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Rising disposable income - Disposable income of the middle

class has increased considerably which has helped air travel

in gaining wider acceptance.

Low penetration level - Air travel penetration in India is less

than half of that in China where people take 0.2 trips per

person per year; indicating strong long term growth potential.


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indian aviation price wars & more

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