Pricingstrategy Indigoairlines 140902015339 Phpapp01

7/25/2019 Pricingstrategy Indigoairlines 140902015339 Phpapp01

1/18

Pricing Strategy-Indigo

Airlines

Prepared by BhooshanKanani

*Prepared for educationalpurpose only


2/18

Agenda

Introduction to Aviation industryin India

About Indigo airlines

Competition Analysis Cost Leadership !he Pricing

Strategy

Success "actors

S#$! Analysis #ay for%ard to Indigo Airlines


3/18

Aviation Industry in

India &'() +, !ata launched !A!A Airline &'. Air India International came

in- being bet%een Indian /ovt0

and Air India1!A!A Airline2 &'.3 Private Sectors players

permitted as Airta4i operators li5e et6 Air Sahara

etc0 &'' Private Carrier permitted to

operate scheduled services

)77(89ntry of lo% cost carriers


4/18

Indigo Airlines

INDIGO

Parent Company Inter/lobe 9nterprises

Category Indian ,omestic Sector

Sector Airlines

!agline:Slogan /o Indigo

;SP $n time performance6 Lo%est price

Indigo is an Indian airline companyhead


5/18

$ne type of airplane - brand-ne% AirbusA()7s

$ne type of fare - lo%

$ne type of customer service - professional $ne %ay to deal %ith delays and

cancellations - honestly

$ne %ay Indigo #ay

STP

Segment Cost Conscious Passenger

!arget /roup Lo%er =iddle Class:=iddle Class

Positioning Lo% Cost >o "rills


6/18

94isting players in Lo% Cost

CarriersCompetition

Competito

rs

et Air%ays

Spice ?et

/o AirAir India


7/18

Comparison %ith

competitors


8/18

Steps up price %ar

@ %on


9/18

Challenge to Indigo

+9"8 http8::%%%0nanciale4press0com 1posted on"eb )3 )7&
http://www.financialexpress.com/http://www.financialexpress.com/


10/18

Pricing

StrategyCutting costs

$ne service one eet 13( Airbus A()7s2

igher fuel eDciency

Alliance %ith Airbus for maintenance

Asset light leasing model Indi/o has '3 employees per aircraftE lean-and-

mean vis-F-visto Air IndiaGs )H7 a plane

$nly Indian airline to adopt +>P approach8 "ueland costsavingsE "aster turnaround at airports

/radual e4pansion

Lo%er ight to mar5et ratio


11/18

Pricing

StrategyCutting costs Single =odel of Aircraft

$perate on SecondaryAirport

ub @ Spo5e =odel

"e%er 9mployees per aircraft

9-!ic5eting

Single Class Conguration

>o In-ight 9ntertainmentSystems

Ancillary +evenues


12/18

Cost Leadership Its /o

Indigo %ay War on Costs

$n an average6 an Indi/o aircraft ies foraround &) hours a day6 compared to . to &7hours logged by most competitors0

Aircraft operates %ith a minimum set of optionale


13/18

Cost Leadership Its /o

Indigo %ay

Being no-frills as an added advantage for theairline6 it ta5es lesser turn-around time then fullservice carriers %hich cater food on-board0

!o reduce its cost of holding inventory ofcomponents6 Indi/o has done a tie-up %ith Air"rance under %hich the "rench airline %ill stoc5components re


14/18

IndigoGs success can be attributedto certain things %hich has donedierently as compared to others

&0 Single type of airplane to reducetrainingand service cost)0$n time performance

(0igh Passenger load factor "light

occupancy percentage

0$ne of the lo%est Cancellationrate in

industry

H0Lean #or5force

Success "actors

Point toPoint=odel

Single

modelofaircraft

$perateon

secondary airport

Single

classconguration

>o In-ight

services

"e%eremployees peraircraft

9-!ic5eting


15/18

S0#0$0!

AnalysisStrength:&0 Lo% fares)0 igh Service Muality(0 $perational 9Dciency0 Customer Service

H0 Short haul ights30 "uel 9Dcient AircraftsN0 $n time departures.0 Investment in technology'0 /ood advertising and

mar5eting strategies&70Lo%est attrition in the

industry

Weaknesses:&0 Less dierentiation)0 Short lived innovations(0 ;ntapped domestic

cargo segment0 >o established

alliancesH0 Lac5 of product

depth and breadth30 Less routes than

competitors

N0 Oet to establish ininternational


16/18

Opportunity:

&0 uge untappedInternationalsectors should bee4plored

)0 /ro%ing demand forlo% cost airlines

(0 Increase thefre


17/18

#ay for%ard for Indigo

airlines94plore untapped Cargo mar5et"ocus on international LCCIncrease product portfolio from LCC to full

carrier service"ocus on innovation"ocus on e4pansion capacityCut do%n of advance boo5ing prices

Lin5 to tourism industry


18/18

Pricingstrategy Indigoairlines 140902015339 Phpapp01

Documents

Transcript of Pricingstrategy Indigoairlines 140902015339 Phpapp01