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AIRLINES INDUSTRY

KINGFISHER AIRLINES

GROUP MEMBERS

FLOW OF PRESENTATION Overview of the Airlines Industry PEST Analysis of the Airlines Industry Introduction to Kingfisher Airlines 7 P’s Industry Lifecycle SWOT Analysis on Kingfisher Airlines Porters 5 Force Analysis for Kingfisher

Airlines Competitor Analysis Recommendations using Ansoff Model Conclusion References

AIRLINES INDUSTRY

Aviation Industry in India is one of the fastest growing industries in the world

Origin of Indian civil aviation industry

India occupies an eminent position in the civil aviation sector with a large fleet of aircrafts

Estimates show that the domestic and international passenger traffic in India is growing tremendously

PEST ANALYSIS – AIRLINE INDUSTRY Political Factors

- India’s political environment – Tension with Pakistan, Government’s inability to control issues (riots etc)

- September 11th- huge drop in air traffic due to safety and security concerns

- Trade relations with other countries have to be good.

Economic Factors

- Recession- airlines are considered as a luxury

- High operation costs due to low demand

- Resulted in laying off employees

PEST ANALYSIS – AIRLINE INDUSTRY

Social Factors

- People from varied income groups have to be catered

- Destination, kinds of food served have to be chosen carefully

Technological Factors

- Use of Internet- online ticket booking, updated flight information & handling of customer complaints.

- Restructuring the existing airports to world class appeal

KINGFISHER AIRLINES

Kingfisher Airlines is a wholly owned subsidiary of United Breweries Holdings Limited

Kingfisher Airlines Limited is an airline company based in Bangalore, India

This airline was introduced in the market to target the domestic luxury segment

Kingfisher Airlines was introduced into the Indian airline market by the Indian Business Tycoon Dr Vijay Mallya

Kingfisher is one of only six airlines in the world to have a five-star rating from Skytrax

P’S PRODUCT PRICE PLACE PROMOTION PEOPLE PROCESS PHYSICAL EVIDENCE

PRODUCT

In-Flight entertainment

PRICEBased on Class of travel

Load factors

Date of travel

Day of travel

Profit margins

Competitors pricing

PLACE “Vijay Mallya” himself is a brand and the brand

“Kingfisher” has also established a remarkable standing in the market place

Kingfisher has a wide distribution channel that gives easy access to it’s customers

Tickets can be booked through various channels Consolidation Tour Operator/ Travel Agency (Clear trip, make my

trip.com Affiliated with companies Direct through home leased system Kingfisher has a plush corporate office in Andheri, well equipped with trained employees & has a spread of offices across India

PROMOTION: ADVERTISEMENTS & PUBLICITY

Hoardings Brand Ambassador Kingfisher Calender

Dmm

NDTV Good Times Tagline Media & Press Releases Releases

SALES PROMOTION PERSONAL SELLING

Travel Agencies Front line staff Kingfisher Red

Offers King Club 5 Star Privileges

PEOPLE At Kingfisher Airlines, ‘people’ are the most important ‘p’

People provide most services that is the selection, training, and motivation of employees

The airhostesses at Kingfisher come in contact with the customers in the process of providing the service, while the cock-pit crew are employees who contribute to the service product but do not come in direct contact with the customers.

Dr. Mallya handpicks the air hostesses for his Airlines as they is expected to possess a pleasing personality with polite service handling

Whereas the cock pit crew at Kingfisher Airlines require to possess high analytical and technical skills

Also at Kingfisher, there is the ancillary service personnel, the travel agent who plays a very important role in creating the service exchange but is not a part of the service.

At Kingfisher Airlines, the front line staff play a critical role in ensuring that the service is delivered to the customers as promised

This ensures some amount of reliability, and this in turn affects the degree of responsiveness sought from customers.

The quality of service that the front-lone staff of Kingfisher Airlines provides is highly dependent on his/her ability to communicate their credibility

The front line staff need to possess ‘empathy’ which implies that these personnel listen, adapt and be flexible in delivering what individual customers need

Some of the employees at Kingfisher Airlines are sent on a 21 day training programme to the US and Frankfurt which motivates them to stay on with Kingfisher.

They are also provided with offers such as one-month bonus or some incentives, on the achievement of the sales targets.

PROCESS

The process of Kingfisher airlines’ service lays emphasis on the involvement of channels, front line staff, travel agency offices, offices of the tour operators or so form where the services flow & reach to the ultimate users.

The process begins at the time of reservation goes on to the confirmation of seats. For e.g.: Computer reservation system of Kingfisher Airlines enables any reservation request from anywhere in the world to be auctioned in minutes. The reservation facility is accessible through all-major computerized reservation system of the world.

By giving details of where to book and how to book Kingfisher airlines help in providing quality services to the customers.

They also offer concession, by not charging any cancellation charges and also giving them the option to make a change in the reservation status if they request.

All these facilities go a long way in increasing passenger convenience.

Facilities at the airport, the baggage handling, flight information, etc. also helps in delivering quality service and making travel a pleasure.

In the aircraft, the meal service, in-flight entertainment, reading material, in-flight amenities, etc. enable the travelers to have an enjoyable and convenient travel.

All these procedures form a part of the total process designed to deliver quality service at Kingfisher Airlines.

Kingfisher Airlines is making every effort to constantly redefine service procedures to enhance service satisfaction levels.

FLOWER OF SERVICES- KINGFISHER AIRLINES

Hospitality &

Caretaking

Consultation

Information

Safekeeping

Order Taking

Billing & Payment

Exceptions

TRANSPORT

BLUE PRINTING Blue printing is a technique which is used to portray

an existing service situation and provides a useful tool to assess and identify service evidence opportunities.

The process of service delivery, the role of customers

and employees and the visible elements of the service are simultaneously displayed by the service map.

Blue print provides 2 additional features to add to the management information.

  1. provides greater attention to customer interaction;  2. Provides a visual representation of the structure of

the service.

BLUE PRINT OF KINGFISHER AIRLINES

PHYSICAL EVIDENCE Physical Evidence refers to the environment in which the

service is delivered and where the service industry and customer interact.

At Kingfisher Airlines, the aircraft by itself, the seating configuration which is meant to be comfortable and spacious, and the in-flight food provided would make up the physical evidence in this service.

Boeing & Airbus are the 2 best commercial aircraft makers and almost all airline industries make use of one of these airlines. The seating is such that it is comfortable and there is enough leg space.

The in-flight food is another, important aspect, a wide selection of meals is offered to the passengers. Passengers are requested to indicate their reference at the time of reservation itself. Kingfisher Airlines has introduced new sleeper seats with electric controls for reclining lumbar support, leg rest extension, expanded seat back height for a more insulated environment, thus providing highly comfortable seating.

Booking offices and ticket counters at Kingfisher Airlines are extremely spacious and well designed with good looks. Further the aircrafts are given excellent exteriors and are maintained well.

The aircrafts at Kingfisher Airlines have elegant interiors well designed seats with more leg room especially in the business class.

Domestic lounges are enhanced withgood interiors and basic amenities which make it an ideal place to conduct business, entertain or relax.

KINGFISHER- INDUSTRIAL LIFE CYCLE

Indian aviation industry growth rate=24% Kingfisher airlines growth rate=37%

KINGFISHER AIRLINES- SWOT ANALYSIS Strengths

- Operating in a niche market: domestic luxury segment

- “Kingfisher” itself is a well established brand

- The customer service provided is extremely exceptional for a domestic airline

- Highly trained and attractive staff.

Weakness

- Unable to generate expected returns on the investments

- overspending of funds

- Loads are lesser than that of its competitor Jet Airways

KINGFISHER AIRLINES- SWOT ANALYSIS

Opportunities

- Aviation industry is a growing industry

- Large number of domestic untapped routes

- Growth in the disposable income

Threats

- Fierce competition

- Major rise in fuel prices

- Cost cutting is become a prime need in the aviation industry

PORTER’S 5 FORCE ANALYSIS FOR KINGFISHER AIRLINES

COMPETITOR ANALYSIS

Attributes KINGFISHER JET AIRWAYS SPICE JET

Price 25% higher than Jet

Airways and Indian

Lower than Kingfisher Airlines

Extremely low

Permission to fly to US

No Yes NA

Permission to fly to UK

Yes Yes NA

IPO Floated Floated Not Yet

Targeted Customers

Both ends of customers

Both ends of customers

Lower end of customers

Positioning Premium Domestic Segment

Premium Domestic and International Segment

Lowest fares and no frills

RECOMMENDATIONS BY STUDYING ANSOFF FOR KINGFISHER AIRLINES

RECOMMENDATIONS BY STUDYING ANSOFF FOR KINGFISHER AIRLINES Market Penetration

Try to look for foreign entrant’s weakness such as Virgin Atlantic which lacks in Indian values & tastes.

Product Development

Seek additional distribution channels such as more tie ups & collaboration

collaboration with international carriers, bilateral discussions over seats and code-sharing between the carriers.

RECOMMENDATIONS BY STUDYING ANSOFF FOR KINGFISHER AIRLINES Market

Development

Special offering for first time fliers

Try to find out new customer group such as Old-retired persons.

Diversification

May go for other services like international flights (concentric diversification)

May get into organising fashion shows etc (horizontal diversification)

CONCLUSION

The ROI is low for kingfisher airlines. (ROI = Profit / Capital Employed)

Being a private carrier it has potential to improve on its margins with effective cost reduction policies.

The strategy of Vijay Mallya is that he uses Kingfisher Airlines to popularize his beer “Kingfisher” thus helping him to leverage his brand name to a win-win situation in both his businesses .

REFERENCES Aviation Week & Space Technology

Low-fare Airlines,. Economist.com.

Crisis at 50, Business World,

Businessline,

The Sky’s The Limit, Indian Express

Oil Prices drown out Airlines profit, Star Tribune,

A Feel for Airline Security. Time Canada,

To Cope With Travel Slump, Airlines Turn to Smaller Jets. (cover story) Wall Street Journal - Eastern Edition, the free content encyclopedia

India Transportation Infrastructure Blueprint

Wikipedia, the free content encyclopedia

http://www.google.com

www.quickmba.com/strategy/ansoff/

www.quickmba.com/entre/definition

www.thehindubusinessline.com/2007/06/01/stories/2007060106400100.htm

www.how-to-make-more-money.com/Vijay-Mallya_biography.html

www.gaebler.com/entrepreneur-characteristics.htm)

www.prenhall.com/scarbzim/html/smallbus.

www.marketingteacher.com/Lessons/lesson_bowman.htm

www.ficci.com/media-room/speeches-presentations/2007/feb/air-con/session3

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