Marketing Plan for Etihad Airways in Indian Destination - Case Study Example

Marketing plan for Etihad Airways in Indian destination Executive Summary This paper outlines a marketing plan for Etihad airways to increase its carriage volumes to India. Current marketing situation and Indian market description is provided. In addition, SWOT analysis of Etihad is discussed. To attain marketing objectives sponsorship activities and advertisements will be carried out throughout the world to create awareness and increase carriage numbers in the business and first class products for passengers destined to India. Table of Contents Current Marketing Situation 3 Market Description 3 Product Review 5 Competitive Review 5 Channels Review 6 SWOT Analysis 7 Objectives and Issues 8 Objectives 8 Issues 8 Marketing Strategy 8 Positioning 9 Product Strategy 9 Pricing Strategy 9 Place Strategy 10 Promotion Strategy 10 Action Programs 11 Budgets 11 Controls 12 Reference 12 Current Marketing Situation Currently, Etihad markets its products mainly through advertisements. This is carried out through newspapers, websites and outdoor advertisements. Even though this strategy is good for increasing the sales of its products no new awareness is created. Thus in this marketing plan, the airline will incorporate promotional activities such as sponsorship to increase awareness among target market. Market Description India’s Aviation Industry is undergoing unprecedented growth due to privatization of the industry that has seen many airlines that are privately owned dominate the market. The Air Corporation Act of 1953 was repealed in 1994 which was aimed at removing monopoly of air corporations on scheduled services. This enabled private airlines to operate scheduled service. It also converted Indian Airlines and Air India to limited company. By 2007, private airlines owned up to 68.5% of domestic carriage. India is the world’s most multidimensional due to its diversity that ranges from snow dusted mountains like Himalayas to sun washed beaches, lantern lit villages to software supreme cities and tranquil temples to feisty festivals. In addition, India is deemed as one stop destination to tourists. The country has diverse ethnic groups that translate into an intoxicating cultural cocktail to tourists. Visitors have a wide range of spiritual sites to visit while in India that is both sacrosanct sites and stirring philosophical epics. There are also historical gems for history lovers everywhere. The country is also equipped with many balmy beaches, big jungle cats and many forests that allow one to inhale pine scented air. A variety of delicious food collection also exists. Furthermore, visitors can stay in the country at reasonable prices dependent on their pockets. Many tourists visit India because it is one of the most economical shopping destinations. It is recognized worldwide as a one stop shopping destination for varied shopping interests. Anything varying from handcrafts to expensive gems can be found in India. A wide range of luxurious and comfortable accommodation is available for business and leisure tourists travelers to stay in. most of hotels in the country are categorized as business hotels, boutique hotels and first class to 5 class hotels (Skytrax 2010). The hotels are equipped with modern and state of the art equipment. The services at the hotels are also among the best inn the world. Kerala in India is dubbed one of the best destinations for honeymooners and many rich couples flock there to spend their honeymoons and holidays there (Shaw 14). The economy of India is also one of the fastest growing economies and given its vast population of more than one billion, many business people fly here to seek business opportunities or markets for their products. First class and business class are usually preserved for corporate and wealthy travelers. These individuals account for the highest percentage of the profitability of an airline especially on the lucrative transpacific and transatlantic business routes (Deccan Herald, 2010). Given the business interests and tourism centers that are widely found in India, many corporate and wealthy travelers fly to this subcontinent. Given the excellent services and facilities of Etihad’s first class and business class product, Etihad will benefit a lot in this market. Product Review Etihad offers free chauffeur drive of up to 150 miles to its first class travelers and 100 miles for its business class travelers. Diamond first class travelers on Etihad airways use aT4 lounge. The new seats in Etihad airlines are being incorporated into a suite that comes with privacy, increased storage and greater comfort. The first class suites also have E-box which is Etihad’s latest incarnation of IFE entertainment system. The cabin are more spacious. During the flight the passengers are offered sleeping suit prior to take off of the flight. The changing room is luxuriously equipped to provide a relaxing atmosphere to passengers using it. The firm will have to improve the on board services that can improve customer satisfaction. Etihad will also need to introduce chauffeur services in India. The business class seats are comfortable and are accessible to the isle. They also come with individual lighting and a lamp for reading (Skytrax 2010). All seats have laptop power cable that supplies AC power and hence passengers can use their laptops during flight without the fear of running out of power. The business class suite has personal in-flight entertainment systems. The travelers in this class can use lounges which belong to Etihad and its associate partners. The service delivery to passengers ought to be improved to improve customer satisfaction in the business class. The firm will also have to introduce chauffeur services for its customers in this class. Competitive Review First class and business class are usually preserved for corporate and wealthy travelers. These individuals account for the highest percentage of the profitability of an airline especially on the lucrative transpacific and transatlantic business routes (Deccan Herald, 2010). The main competitors of Etihad airways in the First class and business class in Asian market include Air India, emirates airline, Gulf air, Kuwait airways, Qatar airways and Saudi Arabia airline.. Etihad airways have the best First class product and service according to Skytrax survey. Air India is the main competitor in of Etihad in the Indian market. Passengers on air India in the first class and business class seats in air India enjoy complementary limousine services on the ground. The seats in first class are flexible and can flatten completely to allow good sleep for passengers. The seats are also spacious and have stylish upholstery. The seats also have a nice padding and headrest. Each seat comes with a large TV screen. Passengers in these seats enjoy privacy via raising the panel that exists between seats. However, the seats are a bit too vertical in upright position. This makes them to be a bit uncomfortable when one is eating. The cabin and seats in air India business class are spacious and plush. It also has an aisle or window seats for each passenger and amenity kit that is contained in an elegant pouch. The firm has excellent on board services in the first class suite. The seat can recline by 8.18 inches. However, the airline lacks lounges at some airports in which it operates. Channels Review Currently Etihad mainly uses direct booking services to its customers at various points at the airport. The firm also outsources booking services from Skyscanner which enable passengers to find cheapest flights with Etihad airways. The passengers can also book flights using this service online. SWOT Analysis Strength of Etihad airways Provides its customers with superior travel experience both on the ground and in-flight It has the best first class product and service The cabins are spacious Etihad has best in-flight facilities for its passengers ranging from entertainment to other comfort facilities Privacy to passengers in first class is assured Weaknesses of Etihad airways Service delivery in business class is not up to the stabndard expected by the passengers Space allocated to seats is also small in business class product Have inadequate washroom facilities in business class product Opportunities of Etihad airways The firm can be able to address issues related to crowding and service delivery in business class to attract more passengers The airline is located in a strategic location in Asian region that presents opportunities to it to tap resources from both western and eastern regions of Asian continent. Threats of Etihad airways Emirates airline is the greatest threat to Etihad due to its outstanding services Fluctuating crude oil prices Recent economic downturn Objectives and Issues Objectives 1. To make Etihad airline to be the most preferred airline in India 2. To maximize the number of passengers destined to India using Etihad airways 3. To enhance brand image of Etihad airways among passengers visiting India 4. To maximize profits for Etihad airways on Indian route Issues Etihad airline faces stiff competition in Indian market in the first class and business class product. The firm aims at becoming the preferred airline in Indian market in the two products. The firm will encounter diverse culture as it tries to establish this position in India. Marketing Strategy The marketing strategy of Etihad will be aimed at increasing carriage volumes of first class and business class passengers destined to India. This will involve increasing awareness among potential customers on the advantages and services provided by Etihad airlines. Advertisement will be used to increase preference among customers to use Etihad’s first class and business class products. The target market will comprise of wealthy and corporate travelers visiting India either for business or leisure purposes. Positioning Etihad will be positioned as a global airline which has best in-flight services and best first class and business class facilities. The firm will also be positioned as an airline which offers the best chauffeur services to its passengers either to the airport or from the airport free of charge for up to 150 miles to first class customers and 100 miles to business class customers. Product Strategy Products ought to provide benefits which enhance the situation of users. In our case Etihad’s first class and business class are able to provide comfort needed by these classes of travelers. In addition, they are affordable since Etihad offers competitive pricing for the two classes for passengers destined to India (Mroue, 2006). Marketing strategies for products include new product lines, innovation, changes or improvements of the products that exist, product line extension, repositioning products and reduction of product cost. In this case Etihad airline changes in the products that exist will be made. Chauffeur services will be introduced in India like that offered by the airline in UK. In addition the airline is introducing new first class suites that come with various features that will be able to fill gaps in the previous suites. Pricing Strategy Price is the only flexible element of marketing mix which can be adjusted at any time (Deccan Herald, 2010). Since in the first class and business class suites in airlines quality is of essence, premium pricing of these products will be employed since it holds a competitive advantage over other airlines due to its high level of services provided. Product line pricing will be implemented with first class being most expensive and business class product fetching considerably lower prices. The firm will strive to ensure that the services offered to these two product lines matches the worthiness of customers money paid. Place Strategy This refers to physical distribution and marketing channels. Etihad will employ a combination of direct channels and the internet for booking flights. Passengers will be able to book flights directly at various Etihad stands found at various airports. The passengers will also be able to log onto the website of Etihad and book flights, check flight schedules, check flight status and get the option to retrieve a booking made. The internet will be powerful element of place that will cover a vast market geographically, reduce costs and allow the use of e-commerce for paying and shopping. Promotion Strategy Promotional strategies are vital in communicating the differentiating features of the product to the target market (Etihad Airways, 2010). Promotional strategies of Etihad will be apportioned between advertising and sponsorships. Sponsorship of various activities and events will deliver fast brand awareness while advertisement will convert the awareness into sales. Advertisement will include newspapers, outdoor advertising and television. Action Programs Etihad will be involved in promoting major events in India. These events will be advertised on Etihad websites to create awareness so as many tourist can be destined to India (Hennig-Thurau, and Hansen 16). The company will also partner with ministry of tourism in India in creating awareness worldwide on tourism sites and events found in India. This will increase travelers to India hence translating in increased booking for Etihad first class and business class products. The firm will also carry out advertisement over television and major newspapers around the world targeting travelers to India. Budgets Activity Asia North America Africa Australia Europe Antarctica Total Television advertisement 4,000,000 6,000,000 3,000,000 1,000,000 7,600,000 400,000 $22,000,000 Newspaper advertisement 2,000,000 4,000,000 2,000,000 800,000 4,000,000 200,000 $13,000,000 Web marketing 100,000 300,000 100,000 100,000 300,000 100,000 $1,000,000 sponsorships 2,000,000 500,000 250,000 250,000 900,000 100,000 $4,000,000 Grand total $40,000,000 Controls To control our marketing plan, we shall divide the implementation of the plan into six region based on the continents. This will ensure that all continents are covered and that our marketing plan does not concentrate in one region at the expense of other regions. Reference Deccan Herald. Bangalore becomes Etihad Airway’s Eigth Indian Destnation. 30 Sep. 2010. 22 Dec. 2010. http://www.deccanherald.com/content/100804/bangalore-becomes-etihad-airwayss-eighth.html Etihad Airways. Flights to India. 22 Dec. 2010. http://www.etihadairways.com/sites/etihad/global/en/home/pages/flights-to-india.aspx Hennig-Thurau, Thorsten, and Hansen Ursula. Relationship Marketing: Gaining Competitive Advantage through Customer Satisfaction and Customer Retention. London: Springer, 2000. Mroue Haas. Etihad Airways. 6 April 2006. 23 Dec. 2010. http://www.airwaysmag.com/channels.html?article_id=2&channel_id=2 Shaw, Stephen. Airline Marketing and Management, 6th Ed. New York: Ashgate Publishing, Ltd., 2007 Skytrax. Etihad Airways – First Class and Business Class Seat. 23 Dec. 2010. http://www.flatseats.com/Reviews/ey-f.htm Read More