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IndiGo is India's largest airline by market share. It started operations in 2006 and uses a low-cost business model, only offering economy class. IndiGo has grown rapidly due to maintaining low fares through strategies like direct sales and not providing meals. It faces competition from other low-cost carriers but has an advantage through maintaining high quality and focusing on customers. The airline aims to continue expanding its routes and market share.
IndiGo is India's largest airline by market share. It started operations in 2006 and uses a low-cost business model, only offering economy class. IndiGo has grown rapidly due to maintaining low fares through strategies like direct sales and not providing meals. It faces competition from other low-cost carriers but has an advantage through maintaining high quality and focusing on customers. The airline aims to continue expanding its routes and market share.
IndiGo is India's largest airline by market share. It started operations in 2006 and uses a low-cost business model, only offering economy class. IndiGo has grown rapidly due to maintaining low fares through strategies like direct sales and not providing meals. It faces competition from other low-cost carriers but has an advantage through maintaining high quality and focusing on customers. The airline aims to continue expanding its routes and market share.
Kiran Chauhan Mohit Gupta Nitin Chawla Harsh Mangal INDIGO AIRLINES INTRODUCTION • IndiGo is a private, low-cost carrier based in Gurgaon, Haryana, India. • The airline started operations in August 2006 and currently is the largest airline in India by market share. • The airline is also one of the fastest growing airlines in the world. ABOUT THE COMPANY • IndiGo was set up in early 2006 by Rakesh S Gangwal, a USA-based NRI and Rahul Bhatia of InterGlobe Enterprises. • InterGlobe holds 51.12% stake in IndiGo and 48% is held by Gangwal's Virginia-based company Caelum Investments. • IndiGo placed a firm order of 100 Airbus A320-200 aircraf during June 2005 in plans to commence operations in mid- 2006. • IndiGo took delivery of its first Airbus A320-200 aircraf on 28 July 2006, nearly one year afer placing the order, and commenced operations on 4 August 2006 with a service from New Delhi to Imphal via Guwahati. DESTINATIONS • IndiGo operates to 33 destinations in India and abroad with 399 daily flights. • Unlike most low cost carriers, IndiGo uses a hub and spoke model used by full service airlines where the airline flights to different destinations are routed through its hub. • In January 2011 IndiGo received a license to operate international flights afer completing five years of operations. • IndiGo's first international service was launched between New Delhi and Dubai on 1 September 2011. STRATEGIES FOR FARE REDUCTION
• Being a low-cost carrier, none of IndiGo's
flights have Business class or First class sections. It offers only Economy class seating. • To keep fares low, IndiGo does not provide complimentary meals in any of its flights, though it does have a buy-on board in-flight meal programme. WHY IT IS THE MARKET LEADER • Indigo's stuck to its low-cost, single class model unlike rivals Jet Airways. • Selling and leasing back planes helps its balance sheet • Quality and detail key to good service • It’s all about customer focus • Using technology smartly MARKET LEADER STRATEGIES • Mobile: Online ticket booking, special assistance for minors, arranging wheelchairs, new mobile application for checking flight status, pre-booked seats and meals on flight • Pre emptive: Indigo placed the largest order in commercial history during 2011 with Airbus for 180 aircrafts, keeping in mind future competition • Position: Tagline-‘On-time, Low Fares, Courteous, Hassle-Free, Low Cost Airlines’ FUNCTIONAL STRATEGIES • One type of airplane –brand-new Airbus A320 • One type of fare-low • One type of customer services-professional • One way to deal with delays and cancellations-honesty • Go local-connect with the middle class • Focus on core competencies and market them • Aim to compete with Railways in the long run • Synergies in offering value added services-Holiday packages/visa services PRICING STRATEGIES • Low cost and high quality of service • Price to be differentiated with respect to days before the travel. • High seating density and load factor • Being a low-cost carrier, none of Indigo's flights have Business class or First class sections. It offers only Economy class seating. • To keep fares low, Indigo does not provide complimentary meals in any of its flights, though it does have a buy-on board in flight meal programme. • Targeting segments locally based on seasons and festivals STRATEGIC OBJECTIVES • Increase number of destinations / frequencies served resulting in market leadership • Top/ of the mind brand in indian aviation industry for AFFORDABLE QUALITY SERVICES • MARKET LEADER in terms of share in the travel industry • Introduce and sustain business travel segment for cost conscious and young professionals COMPETITORS COMPETITIVE RIVALRY • Very little product differentiation in Services • Mature Industry- Only scope for growth by gaining other people’s market share • High bargaining power of suppliers • No sense of brand loyalty amongst customers and can easily switch to other airlines SWOT ANALYSIS STRENGHTS • 1.Low fares • 2.High Service Quality • 3.Operational Efficiency • 4.Customer Service • 5.Fuel Efficient Aircrafts • 6.High brand awareness • 7.Flights are available to customers when • required WEAKNESSES • 1.Less differentiation • 2.Short lived innovations • 3.Untapped domestic cargo segment • 4.No established alliances • 5.Lack of product depth and breadth OPPORTUNITIES • 1. Increasing middle class population • 2. Increase in domestic tourism • 3.Chartered Services • 4.An aviation consulting firm estimates the • cargo services of 3.4million tonnes per annum. • 5. Largest market share among LCCs in Indian • Market THREATS • 1. High ATF prices • 2.Economic slowdown • 3.Government policies • 4. Technological advancement in communication • 5.The shortage of trained pilots, co-pilots and ground staff is • severely limiting the growth prospects of all the airline • companies. CONCLUSION • Low cost airlines have huge potential in the Indian market there are many players entering the market targeting at price sensitive segment. • Open sky policy and deregulation have further open space for many players to enter the market. • Indigo has successfully implemented the low cost strategy with its value added services but still it has huge potential to capture more market if it can establish itself internationally , expand its service to the cargo . • It also has initiated various services to the society such as • “indigo reach” is the CSR programme focus mainly on education, environment, and women.