M04MKT-Etihad V6

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………………………………………………………………………………….……....

48

M04 MKT ETIHAD: The Arabian Dream liner

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)


(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

25


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

27


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

28


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

29


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

30


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,

33


“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.

34


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.

35


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

36


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

37


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)

38


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.

39


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

40


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

41


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relations with the main players of this sector (BBC, 2011)

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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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http://www.qatarairways.com/

http://www.britishairways.com/

http://www.emirates.com/

http://www.etihadairways.com/


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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M04MKT-Etihad V6

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