AIRLINE INDUSTRY AIRLINES INDUSTRY KINGFISHER AIRLINES

GROUP MEMBERS
DIBYAJYOTI BISWAL KALPANA VERMA PAYAL SONAL RAJLAXMI GAURAV AYAN

FLOW OF PRESENTATION

Overview of the Airlines Industry PEST Analysis of the Airlines Industry Introduction to Kingfisher Airlines 7 Ps Industry Lifecycle SWOT Analysis on Kingfisher Airlines Porters 5 Force Analysis for Kingfisher Airlines Competitor Analysis Recommendations using Ansoff Model Conclusion References

AIRLINES INDUSTRY AIRLINE 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

KINGFISHER AIRLINES 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 fivestar rating from Skytrax

THE 7 PS

PRODUCT PRICE PLACE PROMOTION PROCESS PEOPLE PHYSICAL EVIDENCE

PRODUCT

Kingfisher First, Kingfisher Class & Kingfisher Red

Sleeperette seats with extendable footrests. 48" seat pitch and a 125 recline. Fully-adjustable headrests.

Laptop and mobile phone chargers in each seat. Comfortable pillows and snug blankets.

In-Flight entertainment

PRICE
Based on:

Premium pricing strategy Kingfisher Red, its low fare arm adopts a low fare pricing.

PLACE

Services to 80 destinations domestic as well as international 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 its customers Tickets can be booked through various channels

PROMOTION PROMOTION: ADVERTISEMENTS & PUBLICITY

Hoardings

Brand Ambassador

Kingfisher Calender

Dmm

NDTV Good Times Releases

Tagline

Media & Press Releases

SALES PROMOTION
PERSONAL SELLING
Travel Agencies Front line staff

SALES PROMOTION

Kingfisher Red

Offers

King Club

5 Star Privileges

PROCESS

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.

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.

PEOPLE

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

PEOPLE

PEOPLE

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.

PEOPLE

PEOPLE

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.

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

PHYSICAL EVIDENCE

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

INDUSTRY 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

COMPETITOR ANALYSIS
Attributes Price Permission to fly to US Permission to fly to UK IPO Targeted Customers Positioning KINGFISHER
25% higher than Jet Airways and Indian No Yes Floated Both ends of customers Premium Domestic Segment

JET AIRWAYS
Lower than Kingfisher Airlines Yes Yes Floated Both ends of customers Premium Domestic and International Segment

SPICE JET
Extremely low

NA NA Not Yet Lower end of customers Lowest fares and no frills

AILING KINGFISHER
PROBLEMS:

Flight cancellations Cash shortages Survival fears Heavy losses incurred in international flights.

AILING KINGFISHER
REASONS BEING BLAMED
o

High aviation fuel prices Depreciating rupee Policy issues Inability of airlines to hike ticket prices Failed to sustain operations in the peak quarter of the year

AILING KINGFISHER
REASONS BEING OVERLOOKED:
o

Non stop borrowing from banks to fund acquisitions Operating losses inefficient management merger with Air Deccan More emphasis on metro and international routesmaximum losses faced Intensified lower fare offerings

AILING KINGFISHER
o

Deployment of more capacity for international operations Poor management, more emphasis on IPL and Formula 1 team.

REMEDIES:
o

Fund required- restructuring of debt by issuing shares to 14 banks. Forcing banks for debt to equity conversion as a fait accompli.

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 winwin situation in both his businesses .

REFERENCES

Aviation Week & Space Technology Low-fare Airlines,. Economist.com. Crisis at 50, Business World, Businessline, The Skys 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/VijayMallya_biography.html www.gaebler.com/entrepreneurcharacteristics.htm) www.prenhall.com/scarbzim/html/smallbu s. www.marketingteacher.com/Lessons/lesson_ bowman.htm www.ficci.com/media-room/speechespresentations/2007/feb/air-con/session3

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