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Air linesir lines

marketingarketingIndustry scenario-Industry scenario-

Airlines business is a complex phenomenon.Airlines business is a complex phenomenon.

Although it is a part of the transportation industry,Although it is a part of the transportation industry,airlines do not operate in isolation. With the openingairlines do not operate in isolation. With the openingof the Indian economy , Indian skies were alsoof the Indian economy , Indian skies were alsoopened to private operators. To start with private taxiopened to private operators. To start with private taxioperators (ATOs) were introduced but not allowed tooperators (ATOs) were introduced but not allowed tofly on prescribed schedules. Subsequently, fullfly on prescribed schedules. Subsequently, fullprivate airlines status was granted to most of them.private airlines status was granted to most of them.

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According to an estimation there areAccording to an estimation there are

more than 10000 commercial aircraft inmore than 10000 commercial aircraft in

the wo.rld offering more than 1.6 millionthe wo.rld offering more than 1.6 millionseats daily. This is the size of the airlinesseats daily. This is the size of the airlines

market which is expanding at the rate of market which is expanding at the rate of 

more than 7% a year more than 7% a year 

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Before Deregulationefore Deregulation

Before deregulation, special approvalBefore deregulation, special approvalwas required from the civil aeronauticalwas required from the civil aeronautical

board (CAB) to operate on each routeboard (CAB) to operate on each routeand too much competition wasand too much competition wasdiscouraged. Prices were fixed and nodiscouraged. Prices were fixed and nodiscount was possible excepting the 9%discount was possible excepting the 9%

commission on international routes or 7%commission on international routes or 7%or less on domestic routes.or less on domestic routes.

Marketing was also simpler.Marketing was also simpler.

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After deregulationfter deregulation

The immediate impact of deregulation was aThe immediate impact of deregulation was a

price war. Most airlines offered cheaper fares .price war. Most airlines offered cheaper fares .

They also announced certain bonanzas for They also announced certain bonanzas for passengers which were not possible before.passengers which were not possible before.

As a result consumers got benefited andAs a result consumers got benefited and

airlines started losing money. Marketingairlines started losing money. Marketing

became more difficult as leading carriers of thebecame more difficult as leading carriers of theworld had similar aircrafts and equipments.world had similar aircrafts and equipments.

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Marketing strategy ofarketing strategy of

airline companiesirline companies Marketing through travel agencies-Marketing through travel agencies-

90 % of international sales & 70% of 90 % of international sales & 70% of 

domestic sales is done by agents, bigdomestic sales is done by agents, bigand small. They take great interest inand small. They take great interest in

selling airlines products ( seat in theselling airlines products ( seat in the

plane) because airlines give very goodplane) because airlines give very goodcommission to them.commission to them.

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Marketing through consortium-Marketing through consortium-

availability of too many seats on airlines hasavailability of too many seats on airlines has

created a new situation for the travel agencycreated a new situation for the travel agencybusiness. Some corporate houses opened their business. Some corporate houses opened their 

own travel agenciesown travel agencies

and began buying tickets at special rates.and began buying tickets at special rates.

Another development was the formation of Another development was the formation of consortium to obtain bargaining power withconsortium to obtain bargaining power with

airlines.airlines.

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Marketing through CRSarketing through CRS

A modern CRS ( Central reservationA modern CRS ( Central reservationsystem) lists thousands of routes & faressystem) lists thousands of routes & fares

and is able to construct network andand is able to construct network andprice them from its database.price them from its database.

For example-For example-

SABRE by American airlinesSABRE by American airlines

APPOLO by unitedAPPOLO by united

AMADEUS by airfrance.AMADEUS by airfrance.

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Marketing bonanzas-Marketing bonanzas-

at the time of gulf war, British Airwaysat the time of gulf war, British Airways

offered 50000 free tickets on all its flightsoffered 50000 free tickets on all its flightsthroughout the world on a given day-throughout the world on a given day-

april 18, 1990.the aim was to reassureapril 18, 1990.the aim was to reassure

people that travel was safe after gulf war people that travel was safe after gulf war was over.was over.

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Marketing through advertising.Marketing through advertising.