Description
CASE STUDY ON BRAND MANAGEMENT OF AIR DECCAN
CASE STUDY ON BRAND MANEGEMENT
SOURAV PANDA 08DM047 AIR DECCAN Implementing the Low –cost Mo el in In i! B!c"g#o$n As aviation industry was increasing at fast rate t ere was strong co!"etition #etween various "$ayers% Air Deccan introduced t e conce"t of low cost air carrier and was initia$$y &uite successfu$ in i!"$e!enting it% ' e target custo!er of Air Deccan was genera$$y unsatisfied custo!er of (ndian Air$ines w o did not "ut !uc e!" asis on service #ut were "rice conscious% ' e service attracted fre&uent air trave$$ers% ' e case as t e fo$$owing issues) * Studying t e structure of t e (ndian civi$ aviation industry% * Deve$o"ing an understanding on t e o"erations of $ow cost carriers in (ndia% * +,a!ining t e via#i$ity of $ow cost #usiness !ode$ in t e (ndian aviation industry% * Understanding t e target !ar-et and t e "ro!otiona$ strategy of a $ow cost air$ine in (ndia and draw a co!"arison wit t at of fu$$ service air$ine% * Studying t e c a$$enges t at a $ow.cost air$ine co!"any !ig t face in t e (ndian conte,t%
ANALYSIS% Air Deccan/s #usiness !ode$ was ins"ired #y t e g$o#a$$y successfu$ $ow cost !ode$ "ioneered #y t e US.#ased Sout west Air$ines in t e 0170s%' e c a$$enges t at t e co!"any as to face are now on$y #eginning% (n t e initia$ stages of t e co!"any2 !any of t e esta#$is ed "$ayers 3(ndian Air$ines2 4et Airways and Sa ara5 wou$d ave trivia$i6ed t e co!"any and not e,"ected it to reac t e $eve$ it as reac ed now% Sudden$y2 t e co!"any as a""eared as a #ig dot on t e radar screen of t ese we$$. esta#$is ed "$ayers% ' e e,isting "aradig! is t at running an air$ine re&uires $arge funding% Un$i-e air services2 Air Deccan did not "rovide any food on #oard% 7owever2 it so$d snac-s and water #ott$es on its f$ig ts for a "rice% Serving and consu!"tion of a$co o$ were not "er!itted%
' e co!"any fe$t t at for s ort distance do!estic f$ig ts2 !ost "assengers did not want food% (t was fe$t t at t ere was uge growt "otentia$ for 8ow 9os Air$ines in (ndia due to t e country/s uge :00 !n !idd$e inco!e grou" "o"u$ation% ' ey ave done t is t roug a c$ever co!#ination of innovation and outsourcing% More i!"ortant$y2 fro! a strategic "ers"ective2 it gives "owerfu$ evidence to ow tec no$ogy can #e a -ey factor in c anging t e industry dyna!ics2 even in w at were once considered fair$y sta#$e or conservative industries% Des"ite a !idd$e c$ass "o"u$ation of over 0;0 !i$$ion2 on$y t ree to four !i$$ion of t e! used air trans"ort% A -ey reason for t e $ow vo$u!e of air trave$ was "ri!ari$y t e stee" airfares% ' e "erce"tion is t at air trave$ is essentia$$y for t e ric c$ass2 w o can afford to "ay a ig "rice for t e convenience of air trave$ 8ow.9ost Air$ines 389A5 usua$$y o"erate on a <."ronged "o$icy of $ow o"erationa$ costs2 a""ro"riate "ositioning and no.fri$$s services to arness on$y t ose custo!ers w o va$ue c ea" fares% 8ow o"erating costs are ensured t roug cost contain!ent on a$$ as"ects of t e air$ine/s o"eration suc as #y contracting non.core activities2 $ower air"ort fees2 s orter ti!e on t e ground t roug &uic- turnarounds2 si!"$e #oarding "rocesses2 ig er "ercentage of on.$ine sa$es of tic-ets t us2 reducing co!!ission "aya#$e to trave$ agents2 !ore nu!#er of seats on t e aircraft #y o"ti!a$$y uti$i6ing s"ace on t e aircraft2 e$i!ination of #usiness c$ass section on t e f$ig t2 and ensuring t at t e f$ig ts run to fu$$ ca"acities% Un$i-e $egacy air$ines2 $ow.cost air$ines do not use t e traditiona$ u# and s"o-e !ode$% ' ey offer no inter.$ine arrange!ents for sea!$ess "assenger transition or #aggage and$ing fro! one air$ine to anot er% (nnovations to ac ieve tig t o"erationa$ cost contro$ t roug !any innovative "ractices% • Most of t e tic-ets so$d to "assengers are t roug t e (nternet% • A "o$icy of /Pay and f$y/ as against t e /=$y and "ay/ "o$icy fo$$owed #y t e $egacy air$ines ensures t at t ere are no cas f$ow "ro#$e!s% • A $ower turnaround ti!e of 0; !inutes fro! $anding to ta-e.off of an aircraft ensures t at Air Deccan aircraft are air.#orne for a !uc $onger ti!e eac day% (n contrast2 $egacy air$ines ave turnaround ti!es of <0 to ;0 !inutes% ' is trans$ates into ig er fre&uency of f$ig ts2 !ore f$ying ti!e "er day of t e aircraft and conse&uent$y !ore "assengers f$own "er day #y eac aircraft% • ' roug its (nternet #ased syste!2 Air Deccan can dyna!ica$$y trac- $oad factors and ad>ust fares on an on.$ine #asis% ' e advertise!ent ?everyone can f$y@ Air Deccan "ositioned itse$f as $ow cost carrier% (t as ta-en good contro$ of every "ara!eters t at t ere target custo!ers need% 9o!"etitions fro! ot er "$ayers were t ere #ut Air Deccan ad !ade a strong foot o$d in aviation industry% CONCLUSION% Air Deccan was successfu$ in starting a $ow cost carrier and was a#$e to carry forward t e initiative t at it as underta-en% ' e current scenario is so!et ing different as Air Deccan was overta-en #y Aingfis er%
doc_694317499.doc
CASE STUDY ON BRAND MANAGEMENT OF AIR DECCAN
CASE STUDY ON BRAND MANEGEMENT
SOURAV PANDA 08DM047 AIR DECCAN Implementing the Low –cost Mo el in In i! B!c"g#o$n As aviation industry was increasing at fast rate t ere was strong co!"etition #etween various "$ayers% Air Deccan introduced t e conce"t of low cost air carrier and was initia$$y &uite successfu$ in i!"$e!enting it% ' e target custo!er of Air Deccan was genera$$y unsatisfied custo!er of (ndian Air$ines w o did not "ut !uc e!" asis on service #ut were "rice conscious% ' e service attracted fre&uent air trave$$ers% ' e case as t e fo$$owing issues) * Studying t e structure of t e (ndian civi$ aviation industry% * Deve$o"ing an understanding on t e o"erations of $ow cost carriers in (ndia% * +,a!ining t e via#i$ity of $ow cost #usiness !ode$ in t e (ndian aviation industry% * Understanding t e target !ar-et and t e "ro!otiona$ strategy of a $ow cost air$ine in (ndia and draw a co!"arison wit t at of fu$$ service air$ine% * Studying t e c a$$enges t at a $ow.cost air$ine co!"any !ig t face in t e (ndian conte,t%
ANALYSIS% Air Deccan/s #usiness !ode$ was ins"ired #y t e g$o#a$$y successfu$ $ow cost !ode$ "ioneered #y t e US.#ased Sout west Air$ines in t e 0170s%' e c a$$enges t at t e co!"any as to face are now on$y #eginning% (n t e initia$ stages of t e co!"any2 !any of t e esta#$is ed "$ayers 3(ndian Air$ines2 4et Airways and Sa ara5 wou$d ave trivia$i6ed t e co!"any and not e,"ected it to reac t e $eve$ it as reac ed now% Sudden$y2 t e co!"any as a""eared as a #ig dot on t e radar screen of t ese we$$. esta#$is ed "$ayers% ' e e,isting "aradig! is t at running an air$ine re&uires $arge funding% Un$i-e air services2 Air Deccan did not "rovide any food on #oard% 7owever2 it so$d snac-s and water #ott$es on its f$ig ts for a "rice% Serving and consu!"tion of a$co o$ were not "er!itted%
' e co!"any fe$t t at for s ort distance do!estic f$ig ts2 !ost "assengers did not want food% (t was fe$t t at t ere was uge growt "otentia$ for 8ow 9os Air$ines in (ndia due to t e country/s uge :00 !n !idd$e inco!e grou" "o"u$ation% ' ey ave done t is t roug a c$ever co!#ination of innovation and outsourcing% More i!"ortant$y2 fro! a strategic "ers"ective2 it gives "owerfu$ evidence to ow tec no$ogy can #e a -ey factor in c anging t e industry dyna!ics2 even in w at were once considered fair$y sta#$e or conservative industries% Des"ite a !idd$e c$ass "o"u$ation of over 0;0 !i$$ion2 on$y t ree to four !i$$ion of t e! used air trans"ort% A -ey reason for t e $ow vo$u!e of air trave$ was "ri!ari$y t e stee" airfares% ' e "erce"tion is t at air trave$ is essentia$$y for t e ric c$ass2 w o can afford to "ay a ig "rice for t e convenience of air trave$ 8ow.9ost Air$ines 389A5 usua$$y o"erate on a <."ronged "o$icy of $ow o"erationa$ costs2 a""ro"riate "ositioning and no.fri$$s services to arness on$y t ose custo!ers w o va$ue c ea" fares% 8ow o"erating costs are ensured t roug cost contain!ent on a$$ as"ects of t e air$ine/s o"eration suc as #y contracting non.core activities2 $ower air"ort fees2 s orter ti!e on t e ground t roug &uic- turnarounds2 si!"$e #oarding "rocesses2 ig er "ercentage of on.$ine sa$es of tic-ets t us2 reducing co!!ission "aya#$e to trave$ agents2 !ore nu!#er of seats on t e aircraft #y o"ti!a$$y uti$i6ing s"ace on t e aircraft2 e$i!ination of #usiness c$ass section on t e f$ig t2 and ensuring t at t e f$ig ts run to fu$$ ca"acities% Un$i-e $egacy air$ines2 $ow.cost air$ines do not use t e traditiona$ u# and s"o-e !ode$% ' ey offer no inter.$ine arrange!ents for sea!$ess "assenger transition or #aggage and$ing fro! one air$ine to anot er% (nnovations to ac ieve tig t o"erationa$ cost contro$ t roug !any innovative "ractices% • Most of t e tic-ets so$d to "assengers are t roug t e (nternet% • A "o$icy of /Pay and f$y/ as against t e /=$y and "ay/ "o$icy fo$$owed #y t e $egacy air$ines ensures t at t ere are no cas f$ow "ro#$e!s% • A $ower turnaround ti!e of 0; !inutes fro! $anding to ta-e.off of an aircraft ensures t at Air Deccan aircraft are air.#orne for a !uc $onger ti!e eac day% (n contrast2 $egacy air$ines ave turnaround ti!es of <0 to ;0 !inutes% ' is trans$ates into ig er fre&uency of f$ig ts2 !ore f$ying ti!e "er day of t e aircraft and conse&uent$y !ore "assengers f$own "er day #y eac aircraft% • ' roug its (nternet #ased syste!2 Air Deccan can dyna!ica$$y trac- $oad factors and ad>ust fares on an on.$ine #asis% ' e advertise!ent ?everyone can f$y@ Air Deccan "ositioned itse$f as $ow cost carrier% (t as ta-en good contro$ of every "ara!eters t at t ere target custo!ers need% 9o!"etitions fro! ot er "$ayers were t ere #ut Air Deccan ad !ade a strong foot o$d in aviation industry% CONCLUSION% Air Deccan was successfu$ in starting a $ow cost carrier and was a#$e to carry forward t e initiative t at it as underta-en% ' e current scenario is so!et ing different as Air Deccan was overta-en #y Aingfis er%
doc_694317499.doc