PGDM 2013-15

COMPARATIVE MARKET ANALYSIS OF EMIRATES AIRLINES

Submitted by Group 8 (Section B):

Mayank Kumar (1302-084) Nikhil Garg (1302-090) Nikhil James (1302-091) Prashant Gupta (1302-105) Rahul Gupta (1302-113) Rahul Panthri (1302-114) Rajeev Tibarewal (1302-116) Ravi Kumar (1302-120)

TABLE OF CONTENTS
INTRODUCTION ............................................................................................................................................. 3 THE MARKETING MIX 7Ps .......................................................................................................................... 3 Product ...................................................................................................................................................... 3 Price .......................................................................................................................................................... 4 Place .......................................................................................................................................................... 4 Process ...................................................................................................................................................... 4 Promotion ................................................................................................................................................. 5 People ....................................................................................................................................................... 6 Physical Evidence ...................................................................................................................................... 7 SEGMENTATION, TARGETING AND POSITIONING ........................................................................................ 7 Segmentation: ........................................................................................................................................... 7 Targeting: .................................................................................................................................................. 8 Positioning: ............................................................................................................................................... 9 CUSTOMER SATISFACTION SURVEY .............................................................................................................. 9 COMPARITIVE ANALYSIS OF EMIRATES AND ETIHAD ................................................................................. 10 RECOMMENDATIONS ................................................................................................................................. 12 REFERENCES ................................................................................................................................................ 13

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INTRODUCTION
Emirates Airlines is currently the largest airlines in Middle East and fourth largest in the world in terms of passengers carried. Since its incorporation in 1985 by the help of Pakistan International Airlines it has come a long way to become a leading airline offering best in class services to its passengers. It flies to more than 150 cities across 74 countries with a mixed fleet of Airbus and Boeing aircrafts. It is wholly owned by Investment Corporation of Dubai (sovereign wealth fund of Government of Dubai) and is headed by his highness Ahmed Bin Saeed Al Maktoum as the Chairman and Chief Financial Officer (CFO); and Sir Timothy Charles Clark as the President and Chief Executive Officer (CEO). The airline has a fully dedicated terminal (Terminal 3) at the Dubai International Airport.

THE MARKETING MIX 7Ps

Product
The product can be divided into five levels 1. Core benefit: The core benefit of Emirates airlines is to provide air transportation to passengers 2. Basic Product: Emirates offers 3 types of classes i. ii. iii. First Class Business Class Economy Class

The basic product also offer services as comfortable seats, cleanliness etc. 3. Expected Product: The expected product is a transportation service along with food

and beverages, in-flight entertainment and a lounge for waiting. 4. Augmented Product: The augmented product i.e. services that are not offered by competitors are Wi-Fi service, a chauffeur service to first class and business class passengers, a young flyers program for kids, onboard lounge to meet people and shower spa in the first class. 5. Potential Product: Emirates potential product could be addition of services like

onboard recreational facilities for first class and business class passengers. It can also

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improve on the services provided during the waiting time for flights such as free drinking water etc.

Price

Emirates Airlines follows a premium strategy of pricing i.e. high level of pricing for a high level of service provided. Its price is usually greater than its competitors and it continuously works on improvement of the superior quality of service that it provides.

Place
Emirates Airlines is a service based out of Dubai, U.A.E. The numbers of flights operating weekly from Dubai are nearly 3400. The customers can book their tickets through many of its offices and travel shops that operate in various countries. Emirates has also partnered with many travel websites and other travel agents to ease the purchase of tickets. Its official website i.e. www.emirates.com also provides booking services along with other information and services.

Process
The process of Emirates in various services is quite distinct and specialized. It provides special services to its first class and business class passengers such as a chauffeur service, young flyers program. The process for ticketing service is also distinct with services like check in made available at some Dubai metro stations. Its ticketing service also comprises of an e-ticket service from its website or other travel websites and an option of online check in. The ground and inflight services are also unique with its staff trained in many languages who are present during the flight and also on the airport to assist passengers. They also provide a unique assistance to

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senior citizens and disabled passengers. Its ground services also comprise of 32 lounges that they have built in 28 cities for the comfort of passengers while waiting for their respective flights.

Promotion
Hello Tomorrow Campaign Launched on 2nd April 2012, Hello Tomorrow campaign positions the Emirates Airline as the enabler of global connectivity and meaningful experiences. With this they are transforming themselves from a travel brand to a global lifestyle brand. Thus embarking on an integrated marketing communication. With this campaign , they are targeting globalistas- individuals looking and living for new experiences. The company used Strawberry Frog as the communication partner. The campaign features print, TV, digital advertising that includes iconic billboards. With this, company is debuting on Facebook channel to target younger audience. Hello: greeting, an invitation to the person, a place or an experience Tomorrow: a time, place, a state of mind the unlimited possibility of the future Emirates is extending an invitation to try the unfamiliar, create new ideas, and form new visions. The theme encapsulates lifes potential and embracing the future with all the possibilities it holds. Kids go free Campaign Launched on 10th March 2010, this campaigns main target population was the families. Owing to its success Emirates has now partnered with Dubai Tourism and Commerce marketing ( DTCM), over 80 hotels, The Dubai Mall, the Department of Residency, and local destination management companies. This offer gives families an unrivalled integrated destination experience. There are various facilities available for children up to the age of 16. Inflight advertising Emirates engages in promoting their airlines to the customers during the flying time. For this purpose they publishes two inflight magazines. 1. Open Skies: reflects premium and cosmopolitan customer profile. The magazine features in depth profiles of interesting public figures and articles such as on travel, technology, health and business. It is available both in Arabic and in English.

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2. Portfolio: for first class and business class passengers. It consists of interviews, business topics and timely business news 3. TV Advertising Sports and Event Sponsorships Emirates have been sponsoring various sports events in UAE and around the world for over 20 years. It started off with sponsoring the first powerboat race in 1987. Emirates airlines has sponsored football, tennis, rugby, cricket, F1 and sailing. Various events sponsored by Emirates airlines are Dubai International Film Festival, Emirates airline festival of literature and emirates airline Dubai jazz festival. Print Advertisements Emirates airlines print advertisements have evolved over the period of about 12 years. They have used various taglines according to the changing external environment. Some of the slogans used by them include:

Emirates. The Finest in the Sky Be Good to yourself. Fly Emirates When was the last time you did something for the first time. Fly Emirates. Fly Emirates. Keep Discovering Hello Tomorrow

Airlines have also engaged themselves in various marketing: 1. Outdoor marketing 2. Direct Marketing 3. Online Marketing

People
From the very first flight, emirates has engaged itself in empowering its employees in maintain good customer relationships. Various aspects of its employees include: 1. Exceptional customer service skills, cross cultural sensitivity and good attention 2. Nujoum course for cabin crew 3. 7 weeks of ab initio training from Emirates Aviation College

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4. Profit sharing was done among the exceptional employees to motivate them for better customer satisfaction. 5. During the flooding of Manila, staff handled the disruption caused to flights 6. Analyze from flight planning to engineering issues 7. Emirates teams work with manufacturer Airbus on aspects of design

Physical Evidence
Since services offered by the service industry are intangible so it is essential for the service industry to offer a physical touch to the customers. Various initiatives taken by emirates to makes its services tangible are mentioned below: 1. Inflight entertainment system: audio/video options, games 2. Worldwide lounges: for premium members 3. A380: to support mission statement of attaining high standards and deliver their value proposition of being a customer-value oriented company 4. Terminal 3 at Dubai International Airport: to provide its customer the spatial convenience

SEGMENTATION, TARGETING AND POSITIONING

As the airline industry has become highly competent, it has become inevitable for any company to target and position themselves effectively in order to survive in the industry. Emirates airline is one of the biggest company in the airline industry, but today there are large number of Airline companies which are still growing in the market, looking to gain market share. To maintain the foothold in the market Emirates has set out to be an innovative, modern, and customer-oriented provider of high quality air travel services.

Segmentation:
1. Demographics: Age: Emirates offers discount to infants (0-1 year), offers bassinet option as well as different car seats.

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Income: Business class passengers are the most profitable to Emirates who are willing to pay for the luxurious services as price is relatively inelastic for them. Emirates offer these travelers great Wi-Fi, lounge and other premium services.

2. Geographic: Africa, Asia and Pacific are the most favorable destination as together they cover around 70% of the total operable flights.

3. Behavioral factors: Customer loyalty: Skyward is the award winning promotional program for the emirates. It consist of three different tiers namely Blue, Silver and Gold. The services offered under the membership of each tier progresses as a member advances from one tier to another. It could be done either through earning: Skywards Miles which can be redeemed for a variety of rewards and can be earned through flights, promotions and partner offers. Tier Miles are collected only when you fly with Emirates and help you reach the next tier of membership to enter a wider world of benefits.

Targeting:
1. Wealthy travelers: Emirates cater to high ranking executives and businessmen belonging to the age group of 30-60 who are looking for luxury and comfort in travel. It serves all customers regardless of nationality

2. Expatriates: Dubai economic is rapidly increasing which has created huge demand for workforce and the highly paid labor market is a major attraction for the various workforce around the world.

3. Transit passenger: Dubai is the operational hub for Emirates airline which makes it the best position to connect between Europe, Asia and Australia. Emirates have been using connecting point strategy in its marketing endeavors.

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4. African regions: Emirates has realized the untapped potential in this region which is evident from the number of flights which operates to this destination. It is mainly for the high-end segment of customers who have already been to many popular international destinations

Positioning:
Emirates positions itself as a provider of unique services and products with distinguish benefits and attributes such as: SmartLanding and SmartRunway safety solutions Personal Valet ICE : Ground breaking inflight entertainment which provides:

Information: Follow the progress of flight, or take in the view from the aircrafts external cameras. Communication: It helps connect with the outside world through phone, SMS while be seated at the seat. Entertainment: Over 600 channels of premium entertainment to keep customer busy during the flight

CUSTOMER SATISFACTION SURVEY

Customer satisfaction was measured based upon various factors. But there were major three broad areas of services that are provided by any airlines in the aviation industry. These were: 1- Airport services 2- On-board services 3- Staff services These 3 three areas were further classified in to various aspects related to them. There was survey conducted which had questions based on these factors. These factors were: 1- Airport services:
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Ticket counters Check in waiting time

Boarding procedure Lounge product facilities Baggage

2- On-board services: In-flight entertainment Cabin seat comfort Toilet cleanliness Quality of meals Ambience

3- Staff services: Friendliness Attentiveness Assistant Language skills Problem solving skills

The results of the survey showed promising results. On a scale of five grades, ranging from excellent to poor; more than 50% of customers rated Emirates Airlines as very good in all the various aspects of services offered. These results were also confirmation to the fact of emirates airlines winning a number of awards in the airline industry. The overall satisfaction of the customers was satisfactory. Owing to its high class services, Emirates has won the award for best in-flight entertainment services.

COMPARITIVE ANALYSIS OF EMIRATES AND ETIHAD

PRODUCT Emirates have entered into different market segments deviating from their earlier target of premium customers. They have tried to differentiate their products by giving more value addition through many additional services. Emirates were the first one to provide integrated services like ICE. The ceiling depicts the stars in the constellation. Etihad tends to provide features with
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lowest fares so as to attract more customers. There are more sub divisions aimed at targeting all the passenger categories. They also have Etihad holiday to offer holiday packages. Only select flights have internet facilities in Etihad. PLACE Emirates have a sister company Dnata to book its customers. The customers did not have to pay commissions as they can directly book through a portal. Etihad on the other hand signed an agreement with Sabre Airline solutions to use its software for ecommerce, ticket booking and relies on a strong network of agents. Both the airlines have established offices all over the world. PRICING The changes in oil price were directly reflected in the Emirates prices. They also tried different rates for peak and off peak times. Emirates usually raised ticket price during festive periods. Etihad concentrated more on price penetration and since they were controlled by government of Abu Dhabi they could adjust so that the prices are not easily affected by oil prices. They focused more on flexible prices during weekdays and weekends. Etihad Holidays offered holiday packages at comparatively lower prices. PEOPLE Emirates employ 62000 people from 162 countries and are the largest employer in the Middle East. They have a high service culture and employees are made to focus on social responsibility and business ethics. Etihad employs 9000 people from more than 120 countries and extensive training is given. Their uniforms are designed in such a way that it depicts the welcoming and hospitable values of the Arabian culture. PROCESS Emirates employs new ways to cut costs, improve processes and saving time. The reservations for Emirates can be done via internet as well as phone. It also has a dedicated Cargo Customer Relations (CCR) department for cargo claims and complaints. Etihad supports end to end process of ticket booking, arrival/departure, and check in through its CRM. PROMOTION
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Emirates provide special offers like 5% off for MasterCard business card holders and packages like official event tickets and accommodation. It provides in flight advertising through magazines etc. Etihad does sales promotion through coupons and bundled offers. It does advertising through TV, radio and print.

RECOMMENDATIONS
We feel that the following recommendations could help Emirates to further improve their services: 1. Social media can help the airline to build a strong loyal customer base and hence improve its relationship with customers 2. The place element of the product mix can be improved by providing customers with 24 X 7 available sales agents 3. More touch points in malls across Dubai, rest of UAE and at prime locations around the world can help customers in easy access to flight booking and travel planning 4. The people element of the product mix can be improved by mandating the name badges for cabin crew hence making employees more responsible towards the brand image 5. A budget version of the airline can help it capture newer market segments 6. The airline can provide the customers with complete holiday planning packages which could include a virtual tour of the destinations available on its website 7. The color schemes inside and outside the aircraft can be customized as per destinations to make customers feel more attached to the brand

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REFERENCES
http://www.theemiratesgroup.com/english/images/04_EK_Overview_tcm409-560539.pdf http://www.theemiratesgroup.com/english/facts-figures/annual-report.aspx www.emirates.com How Sustainable is Emirates Business Model? by Knorr Eisenkopf http://www.airlinequality.com/Airlines/EK.htm

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