m04mkt-etihad v6
TRANSCRIPT
Experience ETIHAD – The Arabian Dream liner
A Marketing Research on Etihad Airways
Coventry University Business School - MBA
Coursework: A Marketing Research on Etihad Airways
Experience ETIHAD – The Arabian Dreamliner
In partial fulfillment of the course M04MKT – PRINCIPLES OF MARKETING
MBA September 2011
Submitted to:
Module Leader – Mr. Bal Samra
Seminar Guide – Mr. Bhajan Singh Aulak
Date: 6-December-2011
By Concept Crew: The International Marketing Group
Denis Sablin (SID: 4014216)
Cem Dogu Kocaturk (SID: 4041577)
Arjun Raj (SID: 3961629)
Andrew Rowan (SID: 2959357)
Srijit Thankamony Madhusudhanan (SID: 3864087)
Akhil Vijayakumaran Nair (SID: 4018683)
Executive Summary
Flying high from the Middle East skies, Etihad Airways – the young carrier has
positioned itself as a global aviation brand in a short time span of eight years.
The Abu Dhabi based carrier started commercial aviation operations in late
2003 and has achieved the status of one of the world’s rapidly growing airline
during the challenging period of just eight years. The prosperous results of this
early attempt can be attributed to the marketing strategy and initiatives of
Etihad Airways which resulted in a strong global aviation brand closely linked
to world class service delivery, innovation and best in class service with
Arabian Hospitality.
‘Experience ETIHAD – The Arabian Dream liner’ is a positivist marketing
research analysis report on Etihad Airways. This report talks about the
different prospects of the marketing strategy and marketing initiatives of
Etihad Airways and this report would talks about the business background and
the market analysis followed by the marketing orientation of the Etihad
airways.
Table of Contents
1. Introduction…………………………………………………………………………………………… 11.1 UAE Aviation Industry………………………………………………………………..……... 21.2 Organizational Competencies………………………………………………….…..……… 2
2. Marketing Orientation…………………..…………………………………………………………. 22.1 Customer Needs…………………………………………………………………………..……. 32.2 Market Opportunities……………………………………………………………….….…….. 42.3 Marketing Products and Services…………………………………………………...……. 42.4 Customers…………………………………………………………………………………………. 5
3. Segmentation, Targeting and Positioning (STP)……………………………….…….….. 6
4. Marketing Audit ……………………………………………………………………………………… 74.1 Profitability of Market ………………………………………………………………………... 74.2 Competitor Analysis ………………………………………………………..………………… 84.3 Customer Value………………………………………………………………………..………..
104.4 Customer Analysis………………………………………………………………………………
114.5 PESTEL………………………………………………………………………………………………
11
4.6 SWOT……………….……………………………………………………………………………….
134.7 Porters 5 Forces………………………………………………………………………..…….…
145. Marketing Strategy – Marketing Mix………………………………………………….
……….16
5.1 Etihad - Product Strategies ……………………………………………………….………..
165.2 Etihad - Pricing Strategies …………………………………………………………….……
225.3 Etihad - Promotional Strategies ………………………………………………….……….
245.4 Etihad – Place …………………………………………………………………………….…....
295.5 Etihad – People …………………………………………………………………………………
335.6 Etihad – Physical Evidence Strategy …………………………………………………….
355.7 Strategic Model - Ansoff Model…………………………………………………………….
366. Conclusion…………………………………………………………………………………
…..……….38
7. References……………………………………………………………………………………………….
408. Bibliography………………………………………………………………………………
…………….46
9. Appendix………………………………………………………………………………………….……..
48Price Comparison Table…………………………………………………………………………….
48
Market Share………………………………………………………………………………….……....
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1. Introduction
The fastest growing airline company in recent times was founded in July
2003 by Royal Decree. Based in the United Arab Emirates (UAE) capital city,
Abu Dhabi, they currently employ 7,855 people in 44 countries and fly to 66
destinations globally.
1.1 U.A.E. Aviation History
Due to the future decline in oil industries in the region the UAE government
is actively diversifying into other industries with tourism and aviation the top
priorities. UAE’s first airline company was established in March 1985 with
Emirates. Fast economic growth in Asian countries like China and India and
their business relations with other parts of the world and also the labour from
those areas that work in the gulf region generates a huge potential for the
aviation industry. There is also benefit from the increase in the cargo
business between Asia, Africa, Europe and the Americas. “The region is now
on its way to becoming an international air hub, trying to redirect passenger
flows between Europe, America and Asia” (Vespermann, Wald and Gleich
2008).
Today the advancement of the aviation sector is one of the main approaches
for the region to become a global centre for business (trade and commerce).
Thus the regional governments are facilitating the aviation sector and attend
many international exhibitions and fairs.
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1.2 Organizational Competencies
Etihad Airways placed the biggest order in aviation history with up to 205
aircrafts at the Farnborough air show in 2008. Each year the company
introduces a major campaign and invest seriously on marketing as the
marketing department is so important in this sector and in Etihad it has three
divisions, Sponsorship and Exhibitions, Brand Management and Visual
Communication (Etihad Airways 2011).
Etihad are a major competitor with different strategies in the industry as in
one of his speeches in Canada, CEO of the company James Hogan states “We
have a mandate from our shareholder. That mandate is to be the best airline
in the world, not the biggest” (Etihad Airways 2011).
2. Market Orientation
Customer satisfaction and needs are the focus of market orientated
companies. Change and adaption are endemic for survival, responding to
market opportunities will drive companies. Market driven companies seek to
adapt their product and service offerings to the demand of current and latent
markets (Jobber 2007).
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Marketing Orientation (Jobber 2007)
2.1 Customer Needs
Etihad initial focus is passenger’s whose primary location is based in Al Ain or
Abu Dhabi, travelling via Abu Dhabi International Airport. This was reflected
in an earlier advertising campaign slogan “from Abu Dhabi to the world”.
This has since been developed and evolved through a range of campaigns to
“fly with the best”.
Market research led to the development of tailored personal flight
experiences showcased by the 2010 television advertising campaign titled
“he likes, she likes”. The 2011 advertising campaign builds on the product
inspired service philosophy with focus on promoting United Arab Emirates as
both a top tourist and business destination in the world.
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Qualitative aspects of promotions are analysed to further understand and
respond to customers’ needs and also to assess the effectiveness and the
value of company exposure through sponsorship.
2.2 Potential Market Opportunities
Etihad has currently segmented its customers on the basis of the purpose for
which they travel, thus you have passengers segmented into tourist,
personal, religious and business (Milne, 2009). With anticipated growth in
tourist arrivals estimated to increase to 3 million by 2015 from 1.34 million in
2006 (Jones Lang Lasalle, 2009) and the subsequent increase of Abu Dhabi
International Airport capacity to handle upwards of 50 million passengers
annually. Etihad needs to take advantage of this opportunity by
understanding what the customers need and meeting these needs.
Etihad is expanding its global contact centre organization, holiday, and cargo
businesses to take advantage of its customers growing needs.
Etihad is not a member of any global alliances, preferring affiliate and
bilateral relationships with other airlines. These relationships, either
codeshare or special prorate agreements help to increase and enhance the
network it can offer to its customers. These agreements also work in reverse
enabling partners’ access to Etihad’s vast network.
2.3 Marketing Products and Services
Marketing concept; the achievement of corporate goals through meeting and
exceeding customer needs and expectations better than the competition
(Jobber, 2007).
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Etihad’s integrated marketing approach has set it apart from other carriers.
This integrated approach is similar to how DHL marketed itself in the USA
when competing against Federal Express and UPS where specific
advertisements were focused directly at the people who make the decisions
on which freight company to use.
Etihad’s advertising material has been distributed via trade, customer and
VIP events, including the airlines own channels. The high quality collateral
material was reflective of the personalized, luxurious services offered. As the
official flag carrier of Abu Dhabi, the Etihad brand is used to reflect the same
values. The advertising shows the attention to detail and effective
integration from all areas of the business and how they work together to give
the ultimate luxurious flying experience.
Brand building has been further enhanced with the key sporting and cultural
sponsorship events both in Abu Dhabi and around the world, these include
sponsorship deals for the Abu Dhabi F1 grand prix, Manchester City football
club, Sport Australia hall of fame, Rugby, Golf, Hurling and many other art
and cultural events from around the world.
2.4 Customers
Analysis of the microenvironment and more specifically its customers will
show; who the customers are, customer segmentation, why, when and how
they choose Etihad.
Recent research has driven a number of customer focused events to improve
the customer experience and increase satisfaction, these include:-
1. Introduction of self-service kiosks
2. Extended chauffer service
3. Improved menu – “fine dining experience” (Etihad, 2011)
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4. Increased destinations and countries
5. Latest more efficient aircraft
6. Improved loyalty program
7. Improvements in all flight classes
8. New airport lounges
9. Priority boarding
10. Designer uniforms for air and ground staff
The above improvements all confirm Etihad’s vision for the future.
And we are always in touch with your needs. That’s why we are constantly
innovating, taking the smallest detail into account in our pursuit of
excellence and perfection (Etihad, 2011)
3. Segmentation, Targeting and Positioning
( STP )
The marketing strategy of an organization depends on the anticipated
customer needs, behavior and characteristics of the marketing environment.
Segmentation and targeting processes are used to classify the customer
behavior and target the customer in the market and positioning is used to
create an image in customer mindset. (Jobber D, 2010)
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(Las Perner , 2011)
The segmentation of Etihad airways is based on the Geographic,
Psychographic and Behavioral attributes of customers like life style habits
and social class of customers. Etihad focus on a safe and reliable corporate
image with brand building activities and online promotions.
The main target groups of Etihad are the business travelers and the leisure
travelers. The augmentation of product and service offering is achieved by
the different seating arrangements like diamond, pearl and coral classes,
other value added services like ICT services and special services like
religious and medical services. The target reach is achieved with own flights
and code share agreements of Etihad Airways.
Etihad position itself as a full service carrier (Premium Positioning) with the
other premium carriers like Emirates and Qatar Airways. The performance
positioning of the Etihad is acknowledged by the different awards in its
profile. Etihad enjoys the advantage of a well positioned hub and focus on
high standard service with marginal positioning in the market.
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4. Etihad – A Marketing Audit
Etihad’s marketing audit is a study on the various internal and external
factors using the marketing analysis tools such as SWOT, PESTEL and Porters
5 Forces. The result of this marketing audit is to distinguish the various
factors which influence Etihad Airway’s marketing strategies
4.1 Profitability of the Market
The profits of the Middle East carriers are expected to fourfold this year to
$400 million through increased passenger traffic and cargo traffic. The
region will act as a hub between Europe and Asia, as per the latest forecast
from the IATA (International Air Transport Association, 2011)
“The report points to the growing role carriers in the region are playing in the
global travel industry. The IATA tripled its earnings forecast for the industry
to $8.9bn worldwide this year based on a stronger than expected recovery
but said profits would encounter turbulence next year and slow to $5.3bn. It
warned the industry would achieve only "razor thin" profit margins and could
come down with a bump as austerity measures bit across the globe.” (The
National, UAE, 2011)
Etihad announced promising positive EBITDAR (earnings before interest, tax,
depreciation, amortisation and rentals) in 2011 Q1, with revenue growth of
28 per cent. (The Business Traveller, UK, 2011)
4.2 Competitor Analysis
Etihad main competitors are the players from the same region rather than
European, American or Asian airlines. Qatar Airways which is operating in
Doha as a hub and their biggest rival Emirates which is also from UAE and
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uses Dubai as its hub. “Emirates Airlines is the dominant carrier, although
Qatar Airways and Etihad, combined, are roughly 70% of its size. Emirates
turnover is almost 20% of Dubai’s GDP, and the airline is regarded as the
embodiment of Dubai’s rapid rise to international prominence’’ (O’Connell
2011). In addition, Emirates is spending huge amount of money for its brand
awareness especially in sports like $380 million in 2008 which is %4 of its
turnover.
These carriers are mainly based on extra-regional services. “Emirates are
offering 82% of its seat capacity on extra-regional services. Most other
important carriers from the region like Etihad (74%), Qatar Airways (66%)
and Gulf Air (54%) also operate more than half of their seats on extra-
regional flights (AEA, 2006). Air France (26%) and Lufthansa (23%) show that
the share of extra regional offer for European network carriers is
considerably less, indicating that these carriers have stronger domestic
markets. Seat offer by Middle Eastern carriers to Europe is concentrated
around three countries – the United Kingdom, Germany and France – which
together account for 64% of offer” (Vespermann, Wald and Gleich 2008).
Qatar Airways continues to invest in both its fleet of aircraft and at the same
time its hub. For instance the company set up an additional terminal only for
First Class and Business class passengers to minimize the queuing. “The new
terminal for premium passengers will be a big boost for Qatar Airways. It is
the first of its kind, not only in the Middle East, but anywhere in the world”
(Clothier, 2006) as company’s CEO Akbar Al Baker states. The company has
strong policy to expand and since 2010 they launched 25 new destinations.
So with these new routes they fly to 101 different points worldwide. They are
also about to announce a new business class for their passengers aimed at
differentiating them from their competitors.
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One of the important advantages of Etihad competitors is their hubs which
are located on highly attractive touristic locations with significant purchasing
power like Dubai.
“Also these competitors, especially European carriers have good pricing
systems, for example, have been developed in decade-long processes and
are difficult to copy. Other important fields and assets for reaction are
strategic networks and co-operations, frequent flyer programs and booking
systems’’ (Vespermann, Wald and Gleich 2008).
According to the Centre for Asia Pacific Aviation, the market share of Etihad
in the Middle-east region is nearly 4.5% with stiff competition from the
market leader Emirates at 19.3 % & Qatar Airways which has a share of 6.2
%.As a young airliner which started its operations in 2003, Etihad has
challenged these well established airliners & succeeded in strategizing its
expansion spree in the middle-east aviation sector.
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(Centre for Asia Pacific Aviation, 2011)
Etihad’s competitors weaknesses are generally their policies that focuses
mainly high profit value customers instead of budget travellers and middle
class travellers, they also when compared to European predecessors have
less flights to the USA.
4.3 Customer Value
Perceptual segmentation of the market, whether it is perception, belief or
value, shows how both individuals and groups understand the market place
and it residual value. Successful marketing will understand this concept and
focus in on the highest value customer base available (Jobber, 2007)
It is perceived by the customer that they are receiving value when benefits
outweigh sacrifice. Therefore:
Customer value = benefit – sacrifice
Perceived benefit can be generated from the product (for example, first class
travel), associated services (for example, the luxury of its airport lounges)
and the company image (an attractive company profile giving a positive
feel).
Successful marketing will target customers from the largest value pool,
communicate the perceived benefits in order to maximise spending.
4.4 Customer Analysis
Customer analysis is part of the microenvironment and focuses on buyer
behaviour. Firstly, the target market or customer must be identified and then
its requirements or needs conveyed. The marketing plan will then address
these requirements and needs. An understanding of market segmentation,
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benefits sort, choice criteria, how they are rated verses the competition,
distribution channels, promotions and price will be needed to complete the
analysis (Kotler, 2005)
4.5 Etihad - PESTEL Analysis.
There are some factors in the macro environment that effect the decision
making process in an organization. To help analyze these factors marketers
can categorize it using PESTEL model. This distinguishes factors between
political, economic, social, technological, environmental and legal.
The political situation in Emirates gives a competitive advantage to UAE
companies because of political stability in this region in comparison with
other Arabic countries. Etihad is based in Abu Dhabi which is a rapidly
developing city. Dubai has the advantage of starting its development earlier
than other locations, but on the other hand now the growth of Abu-Dhabi’s
economy is higher. It even more influences the Etihad’s role because its
headquarters are located in a capital of the country. There is a competitive
advantage for Emirates and Etihad airlines because they, as other companies
in the country, benefit from a low tax regime and lower costs in domestic
airports.
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The currency value of UAE is closely associated to the US Dollar, which
resulted in a lower exchange value base cost advantage over the EU rivals.
The other features of macro environment are shown at the PESTEL diagram.
4 .6 Etihad - SWOT analysis.
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The SWOT analysis is a simple method used to synthesize the results of the
marketing audit. Strengths and weaknesses are internal resources
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(controllable) or capabilities where threats and opportunities are external
resources (uncontrollable). The analysis will help align strategies to the
needs of the business (Jobber, 2007).
Etihad’s strengths are focused on taking advantage of their opportunities,
having a strong market brand, the backing of the government helps them
take advantage of the growth opportunities in the region.
The matching of strategies is seen where in threats there is a shortage of
trained and qualified personal so Etihad have set up their own learning
academy.
Conversion strategies can be used to remove any threats from the business,
Etihad are working on developing environmentally friendly fuels to help
address the environmental lobbyists, and this is further improved by the fleet
of efficient planes.
The benefits of matching and converging strategies using the SWOT analysis
will reduce the threats to the business and help change weaknesses into
strengths.
4.7 Etihad - Porters 5 Forces Analysis
Michael porter says that there are three horizontal and two vertical factors
exist when we analyze the competition in a market. ‘The porters 5 forces’
model can be used in the airline industry to evaluate the competitiveness in
the airline industry. This model can review the internal as well as external
competition in the industry. There are five factors included in the Porters
analysis.
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Fig 1: Porters 5 Forces Model
Threat of New Entrants: Aviation industry was pretty tough for new
comers to break into in the past. The entry barriers slowly disappeared
when the borrowing became cheaper. Etihad is facing serious threat
from the new entrants to the market. The new Middle East ‘no frills
carriers’ RAK Airways and Air Arabia are major concerns while
considering the threat from new entrants. The Brand Name recognition
and incentives to lure customers from the rivals, mainly from the
Emirates and Fly Dubai are major threats to the Etihad.
Power of Suppliers: There are only a few suppliers in the aviation
industry which leads to the dominance of the suppliers over the
airlines. The aircraft manufacturers and the aviation fuel suppliers are
very limited in their numbers and the airlines have limited influence on
them. The advantage of Etihad is the support of Abu Dhabi government
which is an OPEC member.
Power of Buyers: The customer power to influence marketing strategy
or industry is very limited in airline industry. But the Arabian customer
base can influence Etihad at least in the Middle East.
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Availability of Substitutes: Etihad has major concerns in the business
class as the business travels are replaced by the technology and
communications infrastructure. The Leisure travelers may choose
either shipping or road travel as a substitute.
Competitive Rivalry: The competition is very tight in the domestic and
international market for the airlines in tough economic conditions.
Strong competition from the Middle East causes serious threats to
Etihad.
5. Marketing Mix
There exist two key concepts in marketing management namely the
marketing mix concept and the relationship marketing concept. Marketing
mix is considered to be the foundation of marketing since 1950s where the
4Ps is the cornerstones of the concept. We can blend the concepts of
relationship marketing with marketing mix concept as they can work in
tandem. Some marketing experts debate over the fundamental reasons for
extending the orthodox marketing mix also. The fundamental 4Ps and some
weighted Ps are discussed in the below context for Etihad (Kotler et al,
2005).
“Based upon its understanding of customers, a company develops its
marketing mix” (Jobber, 2001:13).
5.1 Product
In general the product is defying as anything which is capable to satisfy
customers’ needs (Jobber, 2010). Etihad is satisfying clients in different
ways, so we should go deeper in theory to clarify what we are assuming of
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their product. Kotler defines product as anything that can be offered to a
market for attention, acquisition, use, or consumption that might satisfy a
want or need and adds that products include more than just tangible objects
(Kotler, Armstrong, 2005). This aspect is close to Etihad, because they don’t
offer airlines or seats inside it, but they are operating at the service market.
So the core product of Etihad is definitely a service, the air transportation
service.
Under definition of James Fitzsimmons service is “a time perishable,
intangible experience performed for a customer acting in the role of co-
producer” (Fitzsimmons, 2003).
The involvement of the customer in the aircraft routine and non-routine
service and repair operations need attention to hanger design that is not
found in classical manufacturing process. E.g. aircrafts are manufactured in
factories and the supplier is of not worried about it, because clients first see
the result as a well-operating mechanism in the pleasant surroundings of an
air show. That’s the reason for Etihad to pay much more attention to satisfy
customers and not only with convenient routes of travel, but with lots of
other features. It must be said they are operating with quality of services as
an industry leaders.
The core product is quality air transportation services, the company currently
serves 66 destinations in 44 countries and Etihad has serious proposals to
operate from more business hubs and tourist spots across the globe by 2020.
The average operational schedules of Etihad are:
147 flights per day;
1,032 flights per week;
4,472 flights per month; and
53,664 flights per year ( Etihad , 2011 )
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In the Gulf and Middle East they operate over 90 flight schedules per week
from Abu Dhabi to 12 major airports within Europe. (Etihad, 2011)
Etihad has major business opportunities in Australia and tremendous scope
in the Australian continent. Etihad operates 21 schedules per week from Abu
Dhabi to the airports in Australia. The company also operates 22 flight
schedules to Northern East Asia and 14 schedules to East Europe (Etihad
Airways, Feb 2011)
One of the slogans of Etihad is a commitment to providing guests with a
superior travel experience both inflight and on the ground. (Etihad, 2011).
In the air product line of Etihad includes the following core services which are
becoming well-known brands among customers:
Diamond First class: This service was presented in 2009 which can be
converted into a comfortable bed for the passenger. Your cabin is
isolated with two doors to make you enjoy your privacy. This service is
available for flights from USA to Australia and already awarded as
todays best first class.
Pearl Business class: This service of Etihad is also awarded as best
business service both because of convertible seat to a bed and wider
at the same time when compared to its competitors. Additionally it has
entertainment systems and well-designed lighting system.
Coral Economy class: This is also a new service which is mainly
focusing on families and provides support including guiding, new
menus and entertainment before and during the flight.
It draws attention that all of the products mentioned are still young, but
surely they have passed successfully the stage of introduction (at least at
basic geographical destinations of company) and their lifecycle is now at the
stage of growth.
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When reading different prospects of Etihad, you are paying attention that
every product of company is suggested the idea of high quality. Quality
(including services) is defined in different ways and is often considered as
measure of excellence, but this is very misleading as quality is really a
comparative evaluation of one product against another (Addock, 2000).
Speaking about flight services in Etihad, clients are mentioning that their
quality is incomparable. The best way to approach quality is to understand
that it is everything that leads to customer satisfaction.
To further improve customer satisfaction and the whole flying experience
Etihad is also offering the following air service package enhancements:
Interior Finish: Every seat has its own screen for entertainment
purposes and it has many other details on the seat for a comfortable
flight.
Dining: This is another exciting experience especially in Diamond class
and Pearl Business cabins (Etihad, 2010). Although In the Coral class
customers can choose three main courses, one of which is normally
inspired by the destination.
Inflight entertainment: In every Etihad flight you will have a choice of
hundreds of movies and music channels, radios and pc games for
pleasurable hours during the flight.
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Inflight Duty Free: “Etihad offers all guests the opportunity to shop
inflight from the airline’s exclusives range, featuring more than 170
products” (Etihad, 2011).
Etihad also offers facilities for children and families for all users as well as
first class commodities of top brands for Business class passengers.
The augmented product of Etihad is a range of on-the-ground services as
top-class lounges, which are now spread all over the world, Etihad has also
an exclusive service that is called Etihad Chauffeur and it provides a rare
travel experience, Online check-in, Priority boarding, Luxury coach Service
in Abu Dhabi.
Therefore, Etihad as a successful company with great investment
opportunity creates the service profit chain, which provides all range of
services from home in Abu-Dhabi through luxury coach and auto check-in to
comfortable business class seat and finally to a limousine in London, which
can drive you to your destination hotel.
This chain of services deals with not only with satisfied and happy clients,
but with trained, hardworking and well-paid employees as well, due to
greater service value and retaining superior firm performance and economic
growth as a result. All the five elements of Kotlers’s service profit chains are
here.
The Etihad managers continue the service profit chain by providing a
limousine service from home to the airport and then to the final destination.
In 2009 the plans to penetrate the hospitality sector were announced. Now
they are finding its reflection in a loyalty program with Habtoor hotels,
building hotels near Etihad stadiums etc. Management also understanding
that even such a great company can’t provide access to all destinations by
air. To this reason there is an Etihad rail covering 1200 km of railroads in
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Gulf region and some loyalty programs with railroad companies abroad, for
example; French SNCF.
Etihad is not a member of any global alliances, preferring to affiliate and
bilateral relationships with other airlines, hotel chains and railways and like
loyalty programs. This makes your trip more comfortable and on the other
hand bounds the consumer to Etihad with the system of accumulating miles
and associated benefits.
Etihad both their brand and the “word of mouth” can be a guarantee to a
client, that the product of a company can match the highest expectations.
We shouldn’t pass by the plans of Etihad to enter the low-cost segment,
which were announced in summer 2010. “This is about destinations which
have high demand for economy traffic and low demand for premium traffic
such as Alexandria, Calicut, Colombo, Damascus, Doha and
Thiruvananthapuram” (Zawya, 2010). This is not a classical low-cost,
because passengers are provided with beverages and similar facilities like
clients at standard flights, but there are more seats in such airplanes and
cheaper prices. In general the development of this sector doesn’t seem to be
cloudless, because there are already some low-cost operators in both the
Gulf and India regions which have a competitive advantage in price.
Etihad is also operating in the cargo sector which is a profitable one but is
not a core product for this company.
Let’s place the products of Etihad in BCG Matrix.
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5.2 Pricing Strategy and Practices
Price can be defined as “The amount of money charged for a product or
service, or the sum of the values that consumes exchange for the benefits of
having or using the product or service“(Kotler et al, 2005). Pricing is a
fundamental element used in the concept of marketing which produces
revenue and one of the most basic elements of the marketing mix. The
pricing decisions of a firm are influenced by micro economic and macro-
economic factors in the aviation business.
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Internal Factors
Marketing Objectives
Marketing Mix
Strategy
Costs
Organization for Pricing
Pricing Decision
External Factors
Nature of Market and demand
Competition
Other environmental factors
(Economy, resellers, government)
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(Kotler et al., 2005)
The common pricing objectives in any organization are Increasing Profit,
Increasing Revenue, Increasing Quantity, Increasing profit margin and
sustainability of the business.
“The price that company charges will be somewhere between one that is too
low to produce a profit and one that is too high to produce any demand.
Producer costs set a floor to the price; consumer perceptions of the product’s
value set the ceiling. The company must consider competitors prices and
other external factors to find the best price between these two extremes”
(Kotler et al., 2005).
We have different approaches in fixing the price for a product or service. The
pricing approach is connected to three factors namely cost, consumer
perception and the competitors. The main approaches are listed below:
1. Cost based approach
2. Buyer based
3. Competition based
4. Complex dynamic pricing
The complex dynamic pricing approach is used in the airlines as the
competition is so close in the industry.
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Two types of marketing strategies are widely used for pricing of the new
products or services.
Market Skimming – A high initial price with the objective of profit margin
maximization
Rapid penetration – A low initial price with the objective of quantity
maximization
The pricing strategy can be selected based on the life cycle position of the
airline.
Etihad – Pricing and Revenue Management:
Etihad are in the early maturity stage of the marketing product life cycle. The
transformation from rapid growth stage to sustainable maturity stage is not
an easy task in the aviation industry. Etihad have a market penetration
strategy to capture the market share in the Middle East region with the
strategic support from the Abu Dhabi government. Etihad was delivering the
same service as Emirates and British Airways to attract more business and
revenue. Etihad would like to achieve its revenue breakeven point by the end
of 2011 and to achieve profit by 2012.
The pricing and revenue management of airlines are so complex and
dynamic. Dynamic pricing strategy is used in Etihad pricing now. The
dynamic pricing software is used for the yield management and revenue
management in Etihad with the objective of increasing profits based on the
value of proposed sales. Etihad adopted SITA fare pricing software for
ticketing and Descartes & Sabre solutions for cargo pricing and revenue
management.
After the breakeven point Etihad can increase the prices to compete with the
rivals and can achieve the target profits with its luxury high quality image.
Load factor (the seating capacity which is actually sold) and yield (Revenue
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obtained for one passenger per one kilometer) are the two variables
associated with the airline revenue. Etihad can use a balanced load factor
and yield among the new congestion pricing mechanisms to remain
sustainable in the business.
5.3 Promotion
“Promotion is the process of marketing communication involving information,
persuasion and influence” (Hundekar et al. 2010:102).
Any form of corporate communication which uses various methods to convey
certain message to its targeted audience in order to achieve a particular
organizational objective can be called as Promotion. In order to carry out this
process multinationals or organizations engages in spending huge amount of
money through different Promotional strategies. Various such efforts
undertaken by most companies and in this case Etihad are demonstrated as
follows:
Advertising: “Advertising is any paid form of non-personal communication
of ideas or products in the prime media, i.e. television, the press, posters,
cinema and radio” (Jobber, 2001: 353).
Etihad follows a massive advertising strategy through mediums such as
radio, television, newspaper advertisements, magazines, billboards, digital
hoardings, brochures and catalogs, airport and travel agencies in-store
displays, posters, motion pictures, signs, and web pages. The presence of
the brand and its reach is widespread throughout UAE and the world. From
the aggressive advertising campaigns Etihad was awarded ‘World’s Leading
Airline’ at the World Travel Awards in 2010 for the second consecutive
year. It set the benchmark for the airline’s brand communications enabling
“Etihad to inspire its audiences through a range of campaigns to ‘fly with
the best’. The same year, it launched an international television
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advertising campaign titled ‘He Likes, She Likes’ showcasing the airline’s
continued investment in products and services and commitment to
offering a tailored, personal experience for every traveller” (New Business
Age: 2011).
Direct Marketing:
“Direct Marketing is the direct connections with carefully targeted
individual consumers to both obtain an immediate response and cultivate
lasting customer relationships” (Kotler and Armstrong, 2011: 405).
Having established its International offices in more than 35 cities around
the world and through the presence of Etihad Premium Lounges in London
Heathrow, Frankfurt, Manchester and Dublin the company uses its staffs and
employees to market their service through direct sales and exhibitions in
many travel and tourism trade shows. Etihad has also set up a dedicated
Global Sales Team which promotes its Business focusing on corporate and
travel management companies. The UAE and Global marketing team has
explored diverse techniques of promoting and boosting their business
through various channels and services such as Etihad Holidays, global
contact centers, Hala Abu Dhabi (destination management company) ,
Etihad.com ( e-commercial website for sale of tickets, holiday packages ,
chauffer service, hotels, car hire and luxury coach services, etc.) & Etihad
shops located in UAE and abroad.
Sales Promotion:
“Sales Promotions are incentives to consumers or the trade that are
designed to stimulate purchase” (Jobber, 2001: 490).
Etihad carries out a number of sales promotions, one of the noted such
promotion is “Breaking Deals”. Through these special offers Etihad provides
the cheapest air fare for flights originating from Abu Dhabi and other
operating destinations. Etihad also provides complimentary ground transfers
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between Abu Dhabi International Airport (AUH) and Dubai, attracting
customers travelling to and from UAE with their competitive flight fares. The
ground transfer service provided between Dubai & AUH has managed to
attract travellers from their rival carriers as the customers choose to fly with
Etihad for their competitive price. Other sales promotion by Etihad includes
the online web promotions such as “Getaway Deals” available on the website
every Monday offering Etihad customers amazing last minute bargain fares.
The latest promotion includes the “November Super Sale” again available
only on Etihad’s webpage which offers discounted fares for flights operating
from London Heathrow and Manchester to other favorite destinations.
Loyalty Program:
Etihad boasts of its award-winning “Etihad Guest” loyalty program which has
an estimate of one million customers to date. The Etihad Guest miles offer
the Etihad Guest subscribers to redeem the accumulated points at 1800
flight rewards and over 200 participating partners for non-flight rewards. The
non-flight rewards include various categories ranging from lifestyle products
to electronic and computer products. Every year, Etihad hosts over 40
promotional activities to boost the Etihad Guest Loyalty campaigns to attract
more members to this program.
Sponsorships:
“A business relationship between a provider of funds, resources or services
and an individual, event or organization which offers in return some rights
and association that may be used for commercial advantage” (Sleight,
1989).
As a young and innovative carrier, Etihad positions them in a global market
with an aim to help bring the world together. The company promotes both
the UAE local and world cultures in the form of sponsorship of local and world
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events. The innovative airline associate itself with a variety of causes and
events as a facilitator of change to bringing the world cultures together.
Etihad supports and promotes a variety of cultural and sporting events both
in UAE and abroad. Listed below are a number of such sponsorships by the
company so far:
Etihad Stadium – Melbourne, Australia
This is the company’s first and major Sponsorship in the field of Sporting in
Australia. Under this sponsorship, the branding has been prominently
featured both inside and outside the Stadium. This premium stadium is
located in the Docklands precinct with a capacity of approx. 55,000
audiences and hosts a variety of cultural and sporting events.
F1 Etihad Abu Dhabi Grand Prix
The Formula 1 Etihad Abu Dhabi Grand Prix is a sponsorship by the company
in the field of Racing. Located at Yas Island, UAE the circuit boasts of its
spectacular architecture showcasing Abu Dhabi and brand Etihad to the
world audience of more than estimated 600 million viewers.
Manchester City Football Club
The three year partnership contract between the Manchester City Football
club and Etihad showcases the Etihad Brand Logo on the Club’s stadium
throughout, official team shirt, Club’s website and merchandise.
Sport Australia Hall of Fame
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Etihad plays a major role in the sponsorship of Sport Australia Hall of Fame
and also facilitates young athletes for International competitions through
their Scholarship programs.
Golf
The Abu Dhabi Golf championship’s official airline and a diamond sponsor of
the event - Etihad. This event is held in Abu Dhabi Golf Club and is
considered to be one of the region’s biggest tournaments in golf.
GAA Hurling All-Ireland Senior Championship
Etihad Airways is once again the official carrier and sponsor of the GAA
Hurling All-Ireland Senior Championship. The sport is considered to be one of
the oldest sporting competitions of Ireland which has a history to speak of its
own and is also a fastest growing game in the world.
Harlequins Rugby Football Club
Harlequins RFC (UK Premiership Rugby team) are mainly sponsored by
Etihad Airways. The team plays at the Rugby league in UK and Europe and
are located at Twickenham Stoop in London.
Arts and culture
As part of Etihad’s initiative to bring culture and arts to Abu Dhabi and its
people, Etihad has been sponsoring various media events and exhibitions. A
range of Etihad’s sponsorships includes the Abu Dhabi Film festival, Gourmet
Abu Dhabi and international music events such as Coldplay, Shakira, and
Justin Timberlake concerts.
Katrina Kaif
Celebrity Brand endorsement of Etihad is through the Indian Bollywood star -
Katrina Kaif. The move is mainly to attract Indian customers who are a major
market for the company. Katrina Kaif being the brand ambassador has
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participated in promoting the brand and has taken part in many fashion style
shots and international campaigns representing Etihad.
5.4 Etihad - Place:
“Place includes company activities that make the product available to target
consumers” (Kotler and Armstrong 2011: 83).
The main objective of this aspect of the marketing mix is to make sure that
good quality services & products are available at the right time & that too at
the right place, for the customers. The distribution channels are managed
well & used judiciously to achieve this.
The approach of Etihad towards the PLACE aspect of its marketing mix is
outlined below.
Services offered at different locations or offices:
Based on the different categories of customers served by Etihad, it offers
distinct travelling classes for all its flight services which have been listed
below.
1. Diamond Suite and First Class
2. Pearl Class (Flat Bed and Seat).
3. Coral Economy Class.
4. Crystal Cargo.
At the airport:
Etihad airways offer luxury coaches or free chauffeur service to its customers
who wish to travel between Abu Dhabi International airport & Dubai or Al-Ain.
Inside the flight:
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Etihad have a series of special facilities lined up for its customers aboard
their flights:
1. Providing soft toys to kids, facilities to warm food for infants &
changing their clothes.
2. Assistance to unaccompanied minors.
3. 600 hours of entertainment facilities through their entertainment
system E-BOX.
The marketing strategy of Etihad has been a proven success as it took only
seven years for Etihad to reach the level of excellence which took Qatar
Airways and Emirates thirteen years and eighteen years respectively and is
undergoing a major revamp as per the suggestions of Booz and Company,
the high profile global consultation company which was employed for this
particular task by Etihad (Etihad Airways, 2011).
Pros & cons of Etihad’s Place aspect of Marketing Mix:
Pros:
1) Market penetration:
“It involves expansion of sales of existing products in existing markets by
selling more to present customers or gaining new customers in existing
markets” (Hundekar et al. 2010: 58).
Etihad, as a newcomer in the aviation sector, competed against some of the
big players like Emirates and Qatar Airways with panache. It penetrated into
the market by placing its products and services in such a way so as to ensure
its customers had easy access to them.
Their success in a very short span of time can be attributed to their robust
marketing strategy which includes management of a well maintained
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company website through which they reach their customers and potential
customers, which portrays the clarity of their functioning in the best possible
way or in a way which their competitors had never adopted before. In 2010,
the official website of Etihad was visited by as much as twenty million people
and the company launched its website in 12 new countries.
As a newbie, Etihad had to make its presence felt in the aviation sector
through implementing certain new ideas like Crystal cargo, which in 2010
accounted for about 19% of its operating revenue. It is currently on a
freighter network expansion spree which also includes introduction of an
intra-Gulf road freight business which most of its competitors are not into.
2) Coverage and logistics:
Etihad increased its coverage by forging new code share agreements with
airliners like Air Malta, Hungary’s Malev, Virgin Blue, Siberia Airlines (S7) etc.
Etihad has a total of twenty eight code share agreements till date with some
of the best airliners across the globe with twenty eight percent of the
airline’s 2010 passenger revenue coming from this alliance. Etihad currently
serves 144 destinations along with its partners (Etihad Airways, 2011).
Etihad has an efficient network management system which relies on logistics
& planning. In a bid to match the demand for its services, Etihad has ordered
for new airplanes like A380, A320, and B777 etc. to its existing fleet of air-
carriers which by any standard is a step in the right direction by a company
which is highly service oriented (Etihad Airways, 2011).
Cons:
Maturity:
Etihad is at a stage where it is recording growth with increasing sales but it
has its own share of woes in the form of tough competition from its
competitors. In this case,
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“Overall marketing effectiveness becomes the key factor in the stage of
maturity” (Hundekar et al. 2010: 54).
Etihad, as an airliner, is performing well in trying to reach out to its
customers through its different marketing programs. However, when it
comes to the place aspect of its marketing mix, it has reached a saturation
point, like its competitors, with not many options left to satiate the demands
of its customers.
As the adage goes THE HIGHER THE RISE, THE GREATER THE FALL, the
aviation sector has reached a stage where the introduction of innovative
ideas will either yield the same results or no results at all. There is a lot to
choose from for the customers since the aviation market is vibrant & the
ambit for development within this sector is medium if not low as a result of
increase in air traffic & aviation fuel prices & other non-conducive factors.
For e.g.: Kingfisher airlines, India’s second biggest airline, recorded a loss of
£58 million or 4.69 billion rupees because higher fuel costs adversely
affected its revenue in the current fiscal year. It also leads to the company
calling for an end to its presence in the low-cost sector in September with
the shutting down of its carrier Kingfisher Red (BBC, 2011).
Etihad on the other hand maybe one of the ‘big three’ in the middle-east
with the others being Qatar Airways & Emirates
But, the major advantage which Etihad enjoys at this stage i.e. being a part
of an oil rich United Arab Emirates, which is keeping it insulated from the
problems which most of the airlines in the western world are facing in
procuring aviation fuel cannot be kept at bay for too long. In the not so
distant future, every sector is going to face the brunt of oil shortage & the
aviation sector is no exception to this fact.
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The other concern for Etihad is its absence in the low-cost carrier sector.
With Air Arabia as the market leader for this sector in the Middle-east
(Watson, 2011) it is going to be a not-so-easy job for Etihad to penetrate into
this segment as it involves a lot of planning & expenditure.
One question can sum it all up for Etihad: Why would an airliner like Etihad
try to jump into the bandwagon of road freighter business?
5.5 People
Success in aviation sector requires dedication of all intellectual resources at
all organizational layers with a strong leadership and effective management.
Thus communication, application, strategic choice, decision making, training,
rewarding and resource allocation are the main essentials for the
understanding of these crucial organizational processes.
Management:
Etihad Airways is headed by James Hogan since 2006 formerly CEO of Gulf
Air. Other executive managers are James Rigney (CFO), Peter Baumgartner
(CFO), Richard Hill (COO), and Ray Gammell (CPPO).
Staff:
Etihad is aiming to be the best airlines in the sector with the best customer
service as Etihad’s chief commercial officer (for marketing and product),
Peter Baumgartner states “We aim to be the best airline in the world but
importantly our benchmarks are not set within the airline sector, but
elsewhere where customer service is at its best” (Tumer 2008). The
company employs almost 8,000 staff from 120 different nationalities
(including 900 pilots and just under 3,000 cabin crew), the company has
projected this number will grow to 27,000 by 2020.
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Training:
Etihad provides a broad range of training opportunities for its staff including
a cadet pilot scheme, a technical engineering development program and a
graduate management development program (Etihad Airways 2010).
Etihad Airways’ cadet pilot training is a distinctive program that includes
many pilots from all over the world. The successful pilots will join Etihad but
first they should complete an eighteen month course in Abu Dhabi where
company’s all training courses are held. The company has also another 18
month-long course at its academy in Abu Dhabi which is designed to provide
managers for company’s future growth. Also the carrier hired 190 food and
beverage managers from the hotel industry to generate a service similar to a
hotel environment for its customers. Currently it seems that they’ve
achieved this goal with a 91.5% company score according to a customer
service benchmarking survey performed by Ethos Consultancy (Ethos
Consultancy, 2010).
After these successful training periods, in engineering side (their technical
division) Etihad has achieved providing MRO capabilities for many airlines
and it was accredited by Swiss Federal Office of Civil Aviation in 2009.
Rewarding:
Organizations do need incentive systems to encourage highly qualified
employees to make them achieve their goals in all departments. The
company has a new performance evaluation system called “I achieve” and
within this new approach they established performance based pay awards.
95% of the employees were included to this system and all the performance
objectives and the results were recorded after reviews of the line managers
so the employees started to get their performance based bonuses since April
2011. In addition, at Etihad Plaza and at different company accommodation
points across Abu Dhabi, Etihad provides ‘Fit 2 Fly’ leisure facilities including
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gymnasiums, pools and recreational amenities for the best welfare for their
people (Etihad Airways 2010).
5.6 Physical Evidence Strategy.
Physical environment has emerged as an important concept for
understanding customer’s behavior in the service industry (Bitner, 1992).
Whether it’s the chauffer driven limousine with the pristine chauffer, visions
of the cabin staff, the executive lounge or just a sighting of the Royal Decree
on the tail fin of an Etihad airplane at the airport; Etihad is portraying a
visual image of luxurious travel, comfort and superiority through its
servicescape environment.
A product can be touched, experienced and demonstrated. Etihad’s services
cannot, and, as such must be communicated through the surrounding
environment. The physical evidence strategy given to any perspective
customers by Etihad must reflect that Etihad is committed to providing
guests with a superior travel experience both inflight and on the ground
(Etihad, 2011).
Diamond, pearl and coral are used to differentiate and identify the different
classes of travel; Frau, leather seats, flat beds, privacy doors and many other
luxurious accessories all promote the superior luxurious travel. Passengers
can dine when they are ready choosing from an extensive menu. On the
ground the luxurious theme is continued in the many lounges available and
then home in a chauffeur driven limousine or on to your Etihad holiday!
Customer perceptions of Etihad status of a company supplying “the superior
travel experience” are further substantiated with the company’s involvement
in a number of superior promotions and sponsorship deals that are
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consistent with its core values, these include, the F1 Abu Dhabi Grand Prix,
Manchester City Football Club and Sport Australia Hall of Fame.
5.7 Strategic Behavior -Ansoff Model
As per the Capital Magazine, the Etihad strategic behavior is so close to the
Ansoff product strategy model matrix. The business strategy of Etihad
include market penetration strategies, new product development strategies,
market extension strategies and a diversification strategy. (Capital ME,
2011)
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Market Penetration
The Middle East aviation market was the prime focus of the Etihad in the
initial stages of its growth. The Middle East aviation market is aggressively
penetrated by the Etihad with its deliberate marketing strategies and Etihad
is flying high in the world aviation market too.
Product Development
The new product development activities are in a correct proportion in the
Etihad Airways. New products or services are introduced with positive
changes in the existing products or services.
Market Extension
The market development and geographic extension activities are pretty
active in the Etihad. The new destinations like Australia and US are typical
examples for this.
Diversification
The cargo services and the engineering services like the MRO services are
the diversification initiatives from the Etihad.
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6. Conclusion
Etihad emerges as a new leader in the global aviation industry,
substantiating itself as a sustainable growth leader for its Middle East based
rivals and is causing a serious threat to the global carriers. Etihad
transformed from a challenger to leader in not more than eight years of its
existence. The journey of Etihad is with the mission and vision of becoming
the world’s best airline with sustainable growth and serving customers with
its best in class services, supporting Abu Dhabi the achievement of its 2030
plan as a mission critical player.
Etihad has the potential to improve the relationships with global alliances
and code share agreements with other airlines and may promote the Etihad
loyalty program further to capture the client base. Etihad may also add more
high demand destinations in all the price segments increasing the product
offerings. Etihad may also diversify the product offerings with Engineering
and MRO services by adding the airline mail services, road freighter services
and storage services to its product range. Etihad would be better off if it
sticks to strong marketing of its services to cater to its existing customer
requirements and make its presence felt in the low-carrier sector by forging
relations with the main players of this sector and with aggressive
promotional activities.
Etihad will highlight Abu Dhabi as a global tourist destination and business
hub in the Middle East and this ‘Abu Dhabi’ factor is crucial in the marketing
strategy of the Etihad and its future success.
Etihad Airways should evaluate the creation of a long haul, low cost
subsidiary enabling the group to compete against other low cost carriers
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without risking the Etihad premium carrier brand image being diluted by the
cheaper no thrills airline.
After the breakeven point Etihad should increase the prices to compete with
the rivals and can achieve the target profits with its luxury high quality
image. Etihad can use a balanced load factor and yield among the new
congestion pricing mechanisms to remain sustainable in the business.
From Etihad’s promotional mix strategies, it is evidenced that the airline is
carrying out a very wise and different approach in the field of brand building
and promotional techniques. The company’s main focus is currently on
sponsorships. However, since Etihad is a young and modern brand it would
be highly beneficial for the company to invest more on corporate social
responsibility. Even though the brand is doing considerably good in the field
of commercial aviation with respect to its age, a better advertising strategy
would help the company in establishing new fleet routes in areas where they
haven’t yet established a strong hold. An increase in outdoor and indoor
visual display units for advisements in foreign countries focusing on main
aero hubs would assist Etihad in reminding the international travellers of the
advantage of the brand’s service and presence.
Etihad can achieve a sustainable business model with the help of ‘Emirates
business model’ in the Middle East by mixing the airlines business strategy
with the Abu Dhabi’s growth plans in the region. The growth plans can be
achieved by establishing Abu Dhabi as both a tourist and financial business
hub with high class brand image and can position the airline as a market
leader in the global aviation industry.
With escalating unrest in the middle-east region, ever increasing price of
aviation fuel and declining demand, Etihad would be better off if it sticks to
strong marketing of its services to cater to its existing customer
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relations with the main players of this sector (BBC, 2011)
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Springer, P. (2007) Ads to Icons. [online] Available from:
<http://lib.myilibrary.com?ID=91593> [26 November 2011]
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Watson, K. (2011) Middle Eastern airlines feel pain of political unrest. BBC, [online]
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8. Bibliography
1- Archived news 2011, Viewed 04 November 2011,
<
http://www.etihadairways.com/sites/Etihad/global/en/aboutetihad/medi
acenter/newslisting/newsdetails/Pages/manchester-city-and-etihad-10-
year-partnership-deal-jul11.aspx>
2- Crystal cargo 2011, Viewed 09 November 2011,
<http://www.etihadcrystalcargo.com/cargo/>
3- Etihad to sponsor Ferrari F1 2008, Viewed 08 November 2011,
<www.tradearabia.com/news/MEDIA_140347.html>
4- Etihad Airways 2008, Viewed 08 November 2011,
<
http://www.conferenceeventsadmin.com/uploads/assets/strategyawar
ds2009/2008_pdfs/15Marketing.pdf>
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5- Etihad wins major global aviation award 2008, Viewed 10 November
2011, <http://www.ameinfo.com/164108.html>
6- Etihad Airways - Katrina Kaif visits Manchester City FC stadium 2011,
Viewed 12 November 2011, <http://www.youtube.com/watch?
v=URt8em_EZfg&feature=related>
7- Etihad Holidays 2011, Viewed 16 November 2011
<http://www.etihadholidays.com/holidays/Home.aspx>
8- Etihad, Viewed 16 November 2011,
<http://www.airlineleader.com/airline-of-the-month/etihad>
9- Etihad Airways, official partner of Manchester city football club 2011,
Viewed 16 November 2011,
<http://www.etihadfootball.com/EtihadFootball/>
10- Etihad Airways, Official Partner of Harlequins, Viewed 18
November 2011, <http://www.etihadrugby.com/EtihadRugby/>
11- Etihad Airways has signed a 12 month extension to its
sponsorship of the Gaelic Athletic Association (GAA) Hurling All Ireland
Senior Championship as the official sponsor and airline, Viewed 18
November 2011,
<http://www.etihadhurling.com/Etihadhurling/>
12- Etihad Golf Club, 2011, Viewed 18 November 2011,
<http://resources.etihadairways.com/etihadairways/images/Website/G
olfclub/index.html>
13- Factsheets 2011, Viewed 10 November 2011,
<http://www.etihadairways.com/sites/Etihad/Etihad%20Images/
Resources/EY-Factsheet.pdf>
14- Manchester City confirm stadium renaming in Etihad Airways
agreement 2011, Viewed 11 November 2011,
<http://www.guardian.co.uk/football/2011/jul/08/manchester-city-
stadium-etihad-airways>
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15- Milne, D. , King of the Skies, Business mangement, Viewed 11
November 2011, <http://www.busmanagementme.com/article/King-of-
the-Skies/>
16- Manchester City FC launches 'Sky Blue' in UAE supported by
Etihad Airways 2011, Viewed 11 November 2011
http://www.ameinfo.com/278926.html>
17- Our sponsorships 2008, Viewed 10 November 2011,
<http://www.etihadairways.com/sites/Etihad/global/en/aboutetihad/our
sponsorships/Pages/oursponsorship.aspx>
18- Our history 2011, Viewed 13 November 2011,
<
http://www.etihadairways.com/sites/Etihad/global/en/aboutetihad/etiha
dstory/Pages/EtihadHistory.aspx>
19- Our sponsorships 2011, Viewed 13 November 2011,
http://www.etihadairways.com/sites/etihad/global/en/aboutetihad/Page
s/OurAwards.aspx#
20- PESTEL analysis of the macro-environment, Oxforduniversity
press, 2007.
21- The F1 Etihad Airways Abu Dhabi Grand Prix is over for another
year 2011, Viewed 04 November 2011,
<http://www.etihadracing.com/EtihadRacing/>
9. Appendix
Price Comparison – Table
Depart: AUH -> Arrive: LHR
Date: 16- Nov-2011 Return 17-Nov-2011
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(Ticket Price is the total ticket price stated in AEDs and includes return fare,
taxes and surcharges for 1 adult passenger)
Airline Stopover Ticket Price
( AED )
Source
Etihad Direct 5670 www. etihad airways.com
( 2011 )
Emirates Direct 4820 www. emirates .com/ ( 2011 )
British Air Direct 6250 www. britishairways .com
( 2011 )
Qatar Via Doha 3440 www. qatarairways .com
( 2011 )
Market Analysis: O&D Traffic Manchester-Australia 2010
Rank Airline Traffic
Market Share
Market Share Change Since 2005
1Emirates Airline 79,325 47.46% 11.03%
2Singapore
Airlines 24,093 14.41% -14.24%
3 Etihad Airways 21,700 12.98% 12.98%4 Qantas 17,697 10.59% 0.13%
5 British Airways 6,032 3.61% -1.97%
TOTAL167,14
7 -
Table Source: IATA BSP (January 2010 – December 2010)
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Emirates36%
Singapore 0%
Qantas10%BA
2%
Others51%
2005
Emi-rates47%
Singapore 14%
Etihad13%
Qantas11%
BA4%
Others11%
2010
The above graph shows the O&D traffic of different airliners, providing their
services in the UK from Manchester to Australia, for the years 2005 & 2010.
An analysis of these graphs clearly shows that the market leader position in
Manchester is currently held by Emirates. But it needs to be mentioned that
Etihad managed to capture nearly 13% of the market share even though it
started operating flights in this route only from March 2006.It has shown a
similar trend in its services from London Heathrow to Australia in 2010 by
capturing a market share of nearly 6%.This is the perfect example of Etihad’s
intention to establish itself in the western world by employing meaningful
measures in its business.
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