Presented for ‘Marketing Management 1’

On Jun 18, 2009

by

Group G4-12

Atul Kothiyal

Shipra Bansal

Shriman Kalyan

Vamsee Krishna

Great Lakes Institute of Management

Objective� Vision statement of Jet Airways:

“Organization vision is to become the “Best Airline in the World””

� In this presentation, we will understand Jet Airways’ service marketing approach

� Jet Airways in the context of Indian Aviation IndustryJet Airways in the context of Indian Aviation Industry

� Services Marketing – Jet Airways

� Mix

� Characteristics

� Service Offerings

� Marketing strategies – Holistic Approach

� Service Quality Management

� Competitors

� Perceptual Mapping

� Suggestions and action plan

� Closing comments

Indian Aviation Industry

� Fastest growing : 18% per annum

� Govt. open sky policy: Many overseas players

� 75% of domestic markets among private players� 75% of domestic markets among private players

� 9th position in International aviation market

� US$ 5.6 billion in 2008

� Government : � Investment of US$ 9 billion to modernise existing airports by 2010

� Planning to develop around 300 unused airstrips

Indian Aviation Industry – The Market

� Current market share of Indian carriers in the domestic aviation market is shown below: (Jan 2009)

� Jet Airways and Jet Lite (previously Air Sahara) : 29.5%

� Kingfisher Airlines and Kingfisher Red (previously Air Deccan) 29.8%� Kingfisher Airlines and Kingfisher Red (previously Air Deccan) 29.8%

� Air India and Indian (previously Indian Airlines) 14.7%

� IndiGo 10.3%

� SpiceJet 10.3%

� Go Air 4.4%

� Paramount Airways 1.3%

Jet Airways� Incorporated in 1 April 1992| International operations in March 2004

� Parent company: Tailwinds Limited

� Key people Naresh Goyal, founder and chairman

� Hubs at Bangalore, Brussels, Chennai, Delhi, Kolkata, Pune

� Jet Konnect (no-frills, economy class), Let Lite (formerly Air Sahara)

� Diverse in terms of service segments: economy, premiere, first class

Portal � Portal

� Ratings:

� Which? Magazine ranked Jet Airways as the ‘World’s Best Long Haul Airline’ after Singapore Airlines (2008)

� Voted ‘7th Best Airline’ in the World by SmartTravelAsia.com (2008)

� ‘Best Full Service Airline’ by Galileo Express Travelworld for the 6th year in a row (2006)

� ‘Best Customer Service’ by Freddie Awards (2007)

� Code sharing with

� Air Canada, Malaysian Airlines, Qantas, Brussels Airlines, American Airlines, Virgin Atlantic, Kingfisher Airlines

Services IndustryService: “Act or performance one party can offer to another that is essentially

intangible and does not result in the ownership of anything”

� How is it different from consumer marketing?

� Customer focus rather than product focus� Customer focus rather than product focus

� Superior service increases profits

� Timeliness

� Responsiveness

� Benefits are felt in the long run

� Aviation industry: service?

� Intangible

Services Industry – Service Mix•Only productE.g.: SoapPurely Tangible

•High quality support servicesE.g.: Cars, computers, cell phonesTangible with accompanying service

•E.g.: Hotel patronage – food and taste/ preparationHybrid

•Majorly service with support services or goodsE.g.: Aviation industry – Transportation + food/ drinks/ …

Major service with minor goods and services E.g.: Aviation industry – Transportation + food/ drinks/ …services

•Only serviceE.g.: TeachingPure service

•Aviation industry belongs to the category of ‘Major service with

accompanying minor goods and services’

•Tangibles: Snacks, drinks, gifts, boutique, aircraft equipment

•But what the passenger actually buys is ‘transportation’ – a service

Characteristics Of Services (Aviation Industry)

Services

Intangibility & Variability Perishability

Service Marketing:

Transform the intangibles to concrete benefits

Sell on-the-go Demand Management

Demand:

Differential pricing

Non peak demand

Complementary

Reservation system

Supply:

Part time workforce

Peak time efficiency

Shared services

Services Offering Design – Jet AirwaysSupplementary Services(s):

Travel credits, frequent flier,

no-frills, lounge, coach services,

Jet-experience , Jet boutique,

Jet kids, Chauffeur drives, Infant

care, Timeliness, safety,

affordability, better comfort,

in-flight facilities, ease of

reservations, help desk, wheelreservations, help desk, wheel

Chair and stretcher services,

unaccompanied minor care,

travelling with animals

Service Delivery Process:

Online check-in, customized

meal

Core Product:

Aviation service

Service Marketing Strategies – Jet Airways

•Customers are directly involved with the ‘services’

•Understanding what the customers need is primal

•Some of the critical aspects that affect customer perception on service rendered'

Pricing:

Competitive

Concessional fares

Combo fares

Vacation packages

Discounts

Convenience:

Waiting time

Lounges

In-flight service

Pick up service

Jet Privilege

Service Failures:

Billing failures

Complaint resolution

Improper response

High turnaround time

Competition:

Better service

Better equipment

Better ‘value for money’

Better availability

Ethical issues:

Crew and attendants

Conflict management

Care and politeness

Holistic Marketing Approach

� Looking at marketing efforts as a ‘whole’

� More complete & cohesive approach

� Development, design and implementation

of marketing programs, processes and activities

� That recognize their breadth and inter-dependencies

company

External

marketingInternal

marketing

dependencies

� One has to see also the buyers’ point of view in addition to the 4Ps in the context of value delivered

customersemployeesInteractive

marketing

INTERACTIVE

MARKETING

INTERNAL

MARKETING

EXTERNAL

MARKETING

SOCIAL RESPONSIBITITY

MARKETING

Serving the client Training Pricing CommunityFunctional Quality (how services are

rendered) Motivation Distribution Legal, Ethics

Frontline employeesMarketing

Department Promotion Environment

Service Quality ManagementAnalysis of Jet Airways’ focus areas

1. Customer interfacing - Portal/ stalls/ office spaces/ reservation centers …

2. Asset utilization

3. Employees are the best assets –avoid layoffs and improve satisfaction

CONCENTRATE HERE

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KEEP UP THE GOOD WORK

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Extremely important

Fair p

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satisfaction

4. Turn around time

5. Savings on gate charges

6. Streamlined operations

7. Fuel management

8. Ground Handling

9. Point to point rather than hub-and-spoke system

10. Target smaller airports

11. New markets

12. Sharing/ alliances with other players

13. Awards and certifications

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LOW PRIORITY

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POSSIBLE OVERKILL

Slightly important

Fair p

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rmance

Perceptual Mapping - Competitors

High Esteem

Low Esteem

High connectivity

Kingfisher

Jet AirwaysIndian

AirlinesIndigo

Jet Lite

Kingfisher

Red

Spice Jet

High Esteem

Low Esteem

Low Connectivity

Go air

Paramount

Competition… In both domestic and international markets

What Are Competitors Doing???

Sample of one domestic and one international competitor…

� Malaysian Airlines

� Efficient passenger movement

� 100% e-ticketing resulting in cost savings100% e-ticketing resulting in cost savings

� Higher load factor due to dynamic pricing

� Significant improvement in business processes and customer service

� Kingfisher Airlines

� Brand Image

� New fleet of aircrafts

� Unmatched in-flight service

Threats

� Ongoing Economic meltdown� Reduced travelers

� Rising fuel costs

� Rising operational costs� Rising operational costs

� Strong competitors

� Loss of pricing power� Lost its market share to Kingfisher

� Hence lost its position to influence prices

� Indirect: Railways (marketing myopia), technological applications.

Suggestions and Action Plan

� Reducing turnaround time

� Efficient fleet and on-ground service management

� Regular maintenance of flights

� Strategic code sharing

� Introducing a series of innovative valued-added features leading to � Introducing a series of innovative valued-added features leading to customer delight/ in-flight

� Efficient savings in terms of fuels/ Innovation: Alternate fuels

� Improving Brand Image

� Preparedness for long haul markets

� Focus on air-cargo market

� Scope on international service and tourism

Closing Notes… � Jet Airways’ success is owed to ...

� Experience

� Service management

� Holistic service marketing

� Pricing and operational edge

� Jet Airways can achieve it’s vision of being the best airline in the world by concentrating on better service marketing strategies and differentiating over the ever increasing standards in the industry...

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