CASE STUDY ANALYSISAIR DECCAN-THE FIRST LOW COST CARRIER

OF INDIA—YEAR 2006

SUBMITTED BY:SHUBHADIP BISWAS

OPPORTUNITY ANALYSISMARKET ATTRACTIVENESS MACRO and MICRO LEVEL

MACRO LEVEL Repealing restrictive air corporation act & liberalization of air

customer Escalating disposable income of bargaining middle class Indian customer-values his money Growing GDP of India Change in technology-underground fiber optic and networking via

hubsMICRO LEVEL

Need of affordable air fare for Indian traveler-which Air Deccan is offering

Getting 5% of 15 million long distance traveler would be great achieve-targeting AC1,AC2 tier travelers

People of smaller town have the capacity but not have choice

OPPORTUNITY ANALYSISINDUSTRY DOMAINS

MACRO LEVEL and MICRO LEVELMACRO LEVEL

New entrants- Spicejet, Kingfisher, Indigo Substitutes-traveling in AC1,AC2 tier Rivalry-presence of big players- AirIndia, Jet, Sahara—better brand image and

luxurious travel and new players—lowest airfare with highest consumer value Bargaining power of buyer-lower air price Bargaining power of suppliers- low; manufacture of aircrafts- Avions de

transport

MICRO LEVEL Cost leadership Wide network coverage-38 destinations Fast movers advantage and implementation of “Dyna fare” Tie up with HCL-convenient network through E-ticketing Ticket distribution structure-HP outlets, Reliance web world Image-”people’s airlines” Team of experts from the world’s best low cost carriers.

OPPORTUNITY ANALYSISTEAM DOMAINS

MISSION, ASPIRATION,PROPENSITY OF RISK

ABILITY TO EXECUTE CSFs

CONNCTEDNESS UP,DOWNACROSS VALUE CHAIN

DEMISTIFY AIR TRAVEL IN INDIA BY PROVIDING RELIABLE,LOW COST AIR TRAVEL TO THE COMMON MAN BY CONSTANTLY DRIVING DOWN AIR FARES AS AN ONGOING MISSION

COST LEADERSHIP---

EFFICIENT COST CUTTING

STRATEGIES

AIR DECCAN GOLD CARD-TRAVEL AGENT

AIMED—600 FLIGHTS EVERYDAY BY 2009

WIDE NETWORK COVERAGE

TICKET DISRTIBUTION—E TICKETING,MOBILE TICKETING

TARGETED TO FLY 4.4 MILLION PASSENGERS WITH REVENUE OF 1,150 CRORE—IN FY 2005-06

E-TICKETING STRATEGY

SPECIAL TRAINING FOR EMPLOYEES

SEGMENTATION Demographic—common people of India— who does fly? Who can fly? Geographic- market of India specially smaller towns

TARGETING Rising middle class—targeting LCC market

POSITIONING Cost leadership strategy-niche marketing strategy & growth marketing strategy As a “people’s airlines”How is air deccan able to create value for its customers? By cost leadership-offering lowest air fare— “Dyna fare” Prospector-expanding in new market Image as “people’s airlines”—movie "old man in de sky” Brand ambassador-Mr. citizen Unreserved seating . encouraging customer to board easily and quickly Wide network coverage—connectivity Convenience-convenient network of ticket distribution Air Deccan Gold Card- travel agent cardWhat are possible challenges that Air Deccan fears? Threat of new entrants—kingfisher, Spicejet, Indigo Lack of government support Weak economical condition of company-Looming price war waged by big operators Total market share in air service sector was only-17% Lack of brand awareness Need of investment-future scenario after IPO

STP ANALYSIS