History of Emirates Airlines

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Introduction

This report has been developed primarily for Emirates Airlines. The idea

being put forward is for Emirates to widen their market grip into low fare-

budget airlines as well. Emirates have been a market leader in the aviation

industry for over 2 decades. But in order to cut short the completion and also

increase their market share Emirates need to dive into the budget airlines

sector. If Emirates implement the plan perfectly! emirates can gain up to

"#$ of the entire budget aircraft market share in under " years. The plan is

for emirates to initially start short distance international %ights to and fro 2#

countries with &ubai being the international hub for these planes. This plan

will be e'ecuted with the planes being supplied by Airbus. These aircrafts will

be specially designed for Emirates( new low budget carrier

EmiratesMadyaf.

Emirates Airlines commenced operations in the year )*+,. Emirates now

operate and %y to over )# destinations around the globe. Their appro'imate

valuation if gone public/ is estimated at up to 0# billion. Emirates is a

subsidiary of The Emirates 1roup which is an aviation company holding

which is a government-owned corporation.

The main obective of this paper is to analy3e and evaluate the pros and cons

of introducing a new carrier into the Emirates Airline family.

Brief 4istory of Emirates

Emirates airlines with all its lu'ury! being one of the most happening cities!

have its own impressive history in &ubai! 5AE. In )*+! when 4is highness

6heikh 7ohammed Bin 8ashid Al 7aktoum and 7r. 9lanagan decided to


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launch an airlines with a capital of dollar )# billion! they had a clear vision of

their goals. By leasing their :rst ets from ;akistan! Emirates had their :rst

launch. ue style and through competition. ?ver

the years the airline business has e'panded to over )# destinations! which

gives the customers the bene:t of direct %ights. Besides that! the airlines

business has e'panded to award-winning cargo division! leisure division and

an airline IT developer. The tremendous feedback from the pleased

customers has only raised the rank of Emirates among all its competitive

%ights. Accentuating its growth! Emirates airlines is one of the largest

operators of Airbus A"+# and Boeing ===. 7oreover! it has grown in its

:nancial status immensely! which can be seen from the survey as of

2#)"@2#) which shows it carried ., million passengers and 2.2 million

tons of cargo marking it(s at the summit among other airlines.

6?T analysis


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Strengths:

Emirates airlines have the privilege

of e'isting in a country! which is

one of the best tourist hubs in the

world.

Emirates lie in the 5AE where the

cost of fuel is cheap.

Emirates has elevated in rank with

having over )# nationalities of

employees and =+ countries to %y

to.

By entering the cargo business!

Emirates have only reinforced its

position in the market.

Emirates also sponsor various

maor events leading to an

increased brand name all over the

world.

Weaknesses:

Emirates fail to cater the budget

customers! and even their

economy class is over-priced

compared to other international

%ights.

The decrease in tourism can aCect

it unswervingly as it mainly

depends on the international

travelers

The increase in competition has

limited the market growth! and has

raised the bench-mark.

Opportunities:

Introducing a brand new low cost

airline for only budget travelers

could open a whole new

opportunity for Emirates! and will

give it a chance to compete with

not only high-end %ights! but

budget %ights as well.

Emirates can reach to destinations

they haven(t undertaken so far.

7erging with local %ights fromcountries so as to provide

connecting %ights to locations that

don(t have international airports.

Threats:

Increase in fuel prices in the

coming years can be re%ected as a

threat to airlines.

ith %ights like Datar airways! and

Etihad airlines posing competition

for lu'urious %ights! Emirates has

to come up with strategies to :ght

these competitors! and stand out

in the market


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;E6T


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7aority of the consumers %ying by Emirates choose it for reasons such as

business! tourism or further studies which is backed up by the fact that

&ubai is not only the center for tourism but also the hub for healthcare and

education. 9or e'ample! International events! festivals and the &ubai orld

Trade Hentre e'hibitions are few of the reasons that add to the advantage for

Emirates. hatPs more! Emirates provides entertainment and >uality services

of high caliber and facilities due to which we have a loyal customer base. As

a part of our aircraft line we are introducing the new budget airline

Emirates7adyafJ. e will be adopting the niche marketing strategy to

concentrate on the lower and middle income groups.

Profle variable:

1eographic


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Buying on occasionsF ;eople usually travel during school breaks or festivals.

4ence we target mostly tourists and families who want both comfort and low

prices which is what Emirates7adyafJ is being launched to provide.

Psychographic Variable:

uality time with their loved


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ones and strengthen family bonds and friendships. 4ence! the social

aspect is achieved.

2/ Esteem needs and 6elf-Actuali3ation R The satisfaction one receives

from esteem needs is a result of being accepted and valued by thesociety. By travelling! people not only visit important monuments and

museums but they also e'plore the temples and shrines which lead to

them e'periencing the diCerent cultures and traditions. &iCerent

places have diCerent ways of aCecting a person(s way of thinking that

can lead them to live life in a positive way through self enhancement.

?nce the esteem needs phase is achieved! self-actuali3ation becomes

easier to reach.

Hompetitor Analysis

Emirates! one of the leading airline companies in the world! amongst the

other high %ying carriers such as Datar Airways! Etihad Airways! and

! 2#)#/.


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Air Arabia

Air Arabia was nominated as 7iddle East(s Best


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?ther low-cost airlines that are not in direct antagonism but may still pose a

threat to Emirates7adyaf are as followsF

Ryanair R 4ead>uarters in &ublin! Ireland 8yanair poses a signi:cant threat

to Emirates7adyaf position due to its old dominance and consistent

performance over the years. ith total revenue of ).2bn and an average

passenger count of ".+m along with %ying to several destinations!

competition is de:nitely :erce with 8yanair around.

EasyJet- Biggest low cost airline in Britain established in )**,! Easyet gives

competition to all the no-frill airlines with its whooping designed aircrafts and

high maintenance >uality standards. Hurrently! their revenue stands at

).)*bn with a passenger %eet of +"m per year. 7oreover! Easyet competes

drastically for the epitome in budget airlines against Emirates7adyaf as its

sheer dedicated cabin crew and high %ying reputation speak for itself.

STP PROCESS

Product

Product

PRODCT POS!T!O"!"#Emirates airlines are likely tobe considerate withEmirates7adyaf in terms ofpositioning strategies adoptinghighlighting the user! bene:tand price diCerentiationaspects distinctly.

SE#ME"T$T!O"6egmentation is likely to bedemographically distributedwith emphasis onconcentrating on those withboth high and mediumlifestyles.

T$R#ET!"#Targeting is likely to be

undiCerentiated however moredistinct focus on the untapped

market segments targetingthose in need.


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Emirates! being one of the highest grossing airlines with recurrent

improvements and innovations introduce Emirates7adyaf! a vast integration

of Emirates discovering and integrating a new service into the market! a

budget airlines low-cost carrier.

?ne of the main primary core services that it will provide is high-tech in%ight

entertainment systems that will upgrade its overall entertainment >uotient. Abstaining from charging per kilogram and initiating an allowance rate up to

),kg of free luggage baggage. ith collaboration of Emirates A"+# %ights! passengers can now enoy high

end services including neon lights and ambient lighting used for tailored

cabin atmospheres for night %ights! bar facilities and other lu'urious

accommodations that satisfy both budget carriers cost perspective and

passenger appeal. 7oreover! the no-frills airlines can consolidate with Terminal " which is

completely designated for Emirates.

Emirates7adyaf also aims to introduce more user-friendly amenities like

handicapped restrooms! fuselages that are circular in design which helps to

alleviate from pressure loads by tension and also helps relieve passengers

from stress concentration or fuselages rectangular in shape as it proves more

eKcient in space consumption.


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Gonetheless! Emirates7adyaf aims to enhance its passenger comfort level

by implementation of environmental control systems coupled with eKcient

air controlled systems. Air within cabinets is completely interchanged every

2-" minutes wherein high competence :lters eradicate about **.**$ organic

matter and particulate. Alliance with the IHA? who aims to cut back on H?2

emissions by 2#2# implies 9riendly cabin will introduce ingtip devices

proposing sustainable fuel improvements and resourceful operations Airbus

;ro6ky! 2#),/.


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Oisit to 6tep Honference 2#)

4eld on the thand ,thof April 2#) at the &ubai International 7arine Hlub!

6tep gathered ###S like-minded investors!entrepreneurs and industry

e'perts tackling topics involving Tech! &igital and Entertainment. 6tep 2#)

also brought back 6tartup Basecamp across 7EGA! Europe! Gorth America

and other regions providing a platform for new ventures to showcase their

ideas to investors and mentors. Addition to the overall 6tep agenda included

one-on-one sessions! pitch contests for designated start-ups and several

workshops.

Eminent industry leaders stipulated their insights on respected topicsF the

Tech track observed investors discussing latest trends in e-commerce!

wearables etc. All these activities not only would give a head start for the

propagation of Emirates7adyaf! but also develop recognition and a niche for

itself among the other high %ying and established businesses.

This event has the potential to take Emirates7adyaf to new hori3ons and

maintain a sustainable position for itself contributing to the Emirates airlinesportfolio.
http://entm.ag/1LiErjChttp://entm.ag/1LiErjC


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Pricing

;rice is an important element in the overall marketing plan and an apt

pricing strategy needs to be set for Emirates7adyaf. 7any factors aCecting

the appropriate pricing strategy includingF

Passengers carried per year and responsiveness o target market R The si3e

of the passenger %eet will determine the pricing tactic and the aggregate

price to be charged into the market. 7oreover! their willingness and attitude

to pay for elastic prices is a factor.

The cost structureR Traditionally! low-cost airlines aims to oCer low fares via

online booking systems! concealment of free in-%ight catering and the

attainment of homogenous %ights Hassia et al.! 2##/. ith the containment

of costs being an essential factor in the successes of low-cost carriers!
http://www.sciencedirect.com/science/article/pii/S0969699708001221#bib6http://www.sciencedirect.com/science/article/pii/S0969699708001221#bib6


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researchers have devised how cost-eKciency is essential in the derivation for

the pricing policy. 1udmundsson! 2##/.

Fly Dubai Air Arabia

The pricing strategy is miscellaneous

for both economy and business

travelers wherein the latter focuses on

convenience and direct %ights. 9ly

&ubai adopts price-cutting wars during

8amadan time sustaining future growth

and also focuses on dynamic pricing.

8eturn %ights from &ubai to Beirut R

2th&ecember R an 2ndcosts AE&)!*#

;ay less! 9ly moreJ is Air Arabia(s

tagline wherein price plays a crucial

factor in booking %ights. It focuses on

the untapped target segments and

therefore oCers more of a segmented

pricing approach than dynamic pricing

to the 7iddle Eastern target audiences.

6imilarly! a roundabout %ight from

&ubai to Beirut costs AE&2!2! not

very economical here.

As 9ly &ubai may be a clear-cut potential competitor of Emirates7adyaf!

their pricing strategy is likely to be >uite analogous also most probably

oCering a dynamic pricing tactic. Through the integration of the novel budget

airlines! the main focus will be on providing on low fares and competent

prices. here low-cost and full-cost carriers coe'ist on completely separate

ranks! they do not compete together.

P%ace

Emirates airlines currently %y to ) destinations spread over =+ countries in

si' continents. Emirates have a dense presence in the 6outh East Asian

countries as a maority of 5AE(s population are citi3ens of those countries. As

our budget airline is still fairly new! we plan on oCering %ights to ,

destinations in 2# countries listed below. e also oCer

).


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2. Afghanistan". Bahrain. Bangladesh,. Hhina. Egypt

=. India+. ?man*. ;akistan)#. ;hilippines)). Datar)2. Uuwait)". 6audi Arabia). 6ri


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2.

2,.

&'( PROMOT!O"

2=. Emirates airlines are a strong believer of promoting their product! their

budget for promotion almost reached a billion dirhams. ;romotion is the bestway to communicate the product to the end users. 9or our budget airline! the

promotion mi'es that will be used are as followsF

2+.

&irect 7arketingF e will be making use of personali3ed te't messages

and e-mails that are generated by software and forwarding them to our

potential users. The bene:t of this over advertising is that only those who

have subscribed for oCers will receive these emails! making all thereceivers our target market.2*.

AdvertisingF Although the cost of advertising is great! it is very eCective as

it reaches a large market. The media that will be used for advertising are

digital media! print! broadcast and outdoor media. &igital media!


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especially the internet and mobile portion has become an e'clusive way of

communicating and receiving feedback from the customers. 6ocial media

advertisement leads to improved sales and great e'posure. ;rint media

refers to newspaper and maga3ines! for those who don(t have enough time

to surf the web this would be the most appropriate. TO and radio

advertisements are likely to make the product more appealing to the

people they are also moderately cheaper per target reached and

communicate to a mass audience. ?utdoor media that will be used are the

bus stops and billboards in the 5AE."#.

;ublic 8elationsF or ;8 is used for changing the way an organi3ation is

viewed by various groups. Emirates being a :nancially stable organi3ation

can help in developing positive ;8 by undertaking sponsorships.

6ponsorships help in raising awareness of the new airline. 7any events

take place in the 5AE that are viewed worldwide such as tennis! 9) and

horse racing! sponsoring one of these events will provide great media

coverage.").

"2. The other methods in promotion mi' are ;ersonal 6elling and 6ales

;romotion. ;ersonal selling would not be feasible in time and money/ for the

organi3ation as it would involve face-to-face conversation. 6ales promotion

provides incentives in order to make >uick sales! Emirates is a reputed airline

and doesn(t re>uire making >uick sales as they already have a large following. If

anything! these will be used during a recession to attract people.

"".

".

)*( Timing and +udget section36.

"=. The current slogan 4ello TomorrowJ is used to unite people of

diCerent cultures from around the world and through that we plan to


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bring forward Emirates7adyafJ so as to be able to %y people home to

their families.

"+.

"*. The entire idea is primarily focused on the lower and middle

working class who value time and money it would be suitable to

launch this new low-cost airline during peak times when there are

festivals! ideally at the beginning of the year anuary 2#)+/.

;romotions ought to begin at least a year in advance to catch the

attention of potential consumers.

#.

). The budgeting plan will concentrate on marketing

communications costs such as advertising! public relations! including

the planning! e'penditures and ongoing tracking of the marketing

eCorts. This will help us to spend our budget with ma'imum eKciency

and generate ma'imum sales. 7oreover! the integration of ingtip

devices and other environmental control systems may incur some

heavy capital costs but subside in the future. ?verall! a feasibility study

and :nancial statements need to be undertaken to ensure the

implementation of Emirates7adyaf is viable and sustainable in the

unforeseeable future years to come.

2."..

,. Honclusion. Emirates are known for its successful and innovative products

and services that have been given recognition by its loyal customer

base. The inclusion of Emirates7adyaf to Emirates airlines will give it

the opportunity to cater to new clients by altering the e'perience

according to their needs. Got only will this new low-cost airline function

in an environmentally friendly manner but it also helps to increase

tourism.

=.


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History of Emirates Airlines

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