EXECUTIVE SYNOPSIS

The airlines sector in India has seen major changes in the past few years and specially after the liberalization of the Indian economy (after 1991). The entry of foreign and private airlines into Indian air industry. This has not only given competition to the already e isting Indian !irlines but their operations have also revolutionized the technologically advanced bac"ed by heavy promotion activities. Today# various airlines are giving speedy and customised services to their customers to e ist in the mar"et place. !fter the change in the wor"ing environment of all these airlines# Today$s customer e pects a lot of changes in the operations of his airlines so as to get additional or improved services. The improved efficiency of nay airline depends on meeting the customer$s e pectation at various points such as time ta"en for ma"ing an reservation# punctuality of the particular airline# the baggage handling# food and above all the friendliness of the cabin crew# etc. This project deals with the study of level of satisfaction among the customers of the airlines under consideration. It is an attempt to "now the perception of the customers about how the services of an airline should be. %hat is the importance of various attributes such as interiors of an aircraft# the food served# the courtesy of the crew etc. !n attempt has also been made to analyze the service delivery gap in detail which will provide a direction to ma"e improvements in the thrust areas. It is sincerely hoped that this research would prove to be of some help to whomsoever may find it to be of his&her interest.

INTRODUCTION
In the light of liberalization in Indian 'conomy after 1991# the airline sector has seen major changes. 'arlier there were only a few numbers of airlines operating in India and thus the competition was limited. Their services were not customer ( oriented. )ow with the wave of liberalization# a number of foreign and private airline have entered the Indian air industry. This has given intense competition to the already operating airlines in India forcing them to revolutionize their operation and also carrying out heavy promotional activities to attract customers. Today# various airlines are focusing on speedy and customized services to their customers in order to survive in the mar"et place. *ince the customers have a choice between a large number of airlines their e pectations of better and improved services have increased. The efficiency of any airline depends on meeting the customers e pectations as regards punctuality# safety# baggage handling and above all friendliness of the crew etc. %ith this prerogative I have underta"en this study to evaluate and analyze the service delivery gap in the airline industry.

RESEARCH METHODOLOGY
*ample size of the airlines *ample size of the customers - *tructured .uestionnaire - In-depth interview *ample unit *ample identification + + + + 1// 10 Individual 1eople who have flown in airlines under consideration. DATA SOURCES 1rimary 2ata would be collected by tal"ing to the people from the airline industry# collecting primary information through 3uestionnaire and interviews. *econdary 2ata would be as follows+ a) !viation magazines b) !nnual aviation journey c) 4rochures collect from different airline offices d) 152 6ibrary e) Internet RESEARCH INSTRUMENTS a) *tructured .uestionnaires# b) In-depth interviews + , Top airlines

PROBABLE FINDINGS This research could lead me to the reasons that why customers are not satisfied with the facilities provided by the airlines and what are the ways in which the airlines can improve upon their wor"ing and their facilities. DATA ANALYSIS TECHNIQUE *imple averages Tabulation *elf e planatory graps

OBJECTIVES
This study was carried out "eeping the following objective in mind+ Objective: To identify the service delivery gap in the airline industry in order to minimize such gaps for effective service delivery. 1) Indian !irlines 7) 8et !irways ,) *ahara India !irlines 9easuring the customer satisfaction level in the airline industry on the predetermined attributes. 1. 1unctuality 7. 1romptness of service ,. :ourtesy ;. <eservations 0. *afety =. Interiors >. ?ood @. Around *upport *taff 9. ?re.uently of flights 1/. 2estinations :overed 11. 4aggage 5andling 17. *taff Bniform 1,. 2iscounts. The above mentioned attributes were ta"en into consideration after considerable discussion with people from the airline industry and going through prior surveys.

SCOPE OF THE STUDY This study is on the customer perception of the domestic air industry. The scope of this study could be immense as this study would give us a starting point to understand the customer perception about the domestic air industry and we would be able to "now the reasons why customers li"e or disli"e the domestic air services and what are the areas where we can improve upon.

AIRLINE INDUSTRY A BRIEF INTRODUCTION

!irline represent the romance of travel. 6i"e any industry# the airline produce a product# sell it# deduct e penses and hence generate profit (loss). !n airline produces an intangible product# which is an !C!I6!46' *'!T 9I6' (Dne seat flown one mile). ?illing the seat is the actual sale which is called a <'C')B' 1!**')A'< 9I6' (<19). The actual relationship of an !C!I6!46' *'!T 9I6' (!*9) to an <*9 is e pressed as a percentage called the 6D!2 ?!:TD<. The higher the load factor# the greater the net incomes. The load factor is important because the product is a Eperishable goodF. Dnce the airline has flown its destination# any unoccupied seats are lost as potential revenue forever. !nother very important factor which determines profitability is 9!<G'T *5!<'. It has been observed that a carrier that can out do its rivals in capacity can substantially e pend its mar"et share. It has become .uite a small country# than"s to the flying machines. 8umbo carriers and supersonic travel has become so common today that most people e cept those connected with the industry devote no more than a passing thought to aircraft$s and yet# every thing that happens in the industry from a new plain developed a rout being dropped from an airline$s schedule has a crucial bearing on our lives. That is simply because any change in the industry directly impacts on time spent in travelling and transporting goods from once city to another.

Indian aviation is currently passing through a critical phase. The much needed facelifts is being done through the induction of high-technology aircraft# e panding the route networ" and modernizing the airport facilities# just to name a few. CONCEPT OF MARKETING IN THE AIRLINE INDUSTRY The airline industry which is a service-oriented business is difficult to mar"et using only traditional mar"eting approach. In a product business# the product is fairly standardized and sits on a shelf# waiting for the customer to reach for it. In the airline business# the customer confronts the airline whose service .uality is less cretin and more variables. !s competition intensifies# more mar"eting sophistication will be needed. !irline companies face three tas"s# those of increasing their+ (i) (ii) (iii) :ompetitive differentiation *ervice .uality 1roductivity Carious carriers have introduced such innovations as movies on board# advanced seating# merchandise for sale# air-to-ground telephone service and fre.uent (flyer award programs to augment the offer. %hile one airline introduced sparsely consumed cabin crews# another added a piano bar. !irline today tal" about adding suit pressing and shoe-shining services# a library of best selling boo"s and magazines# lap to computers and so on. The only problem is that most of these innovations are easily copied. ?ew of them are preemptive in the long run. *till the airline that regularly researches and develops innovative will gain a temporary advantage over

its competitors. In the process they earn innovative reputation and may retain customers who want to go with the best airline. Dnce of the major ways to differentiate airlines is to deliver consistently high .uality services than competitors. The "ey is to meet or e ceed the target customer$s service .uality e pectations. 4ut the airlines constantly face trade-offs between customer satisfaction and company profitability. The airline therefore# clearly defines and communicates the service level that will be provided# so that will be provided# so that employees "nows what they should get. Bnfortunately most after the airlines don$t what they promise. That third aspect is to increase productivity. This is done by designing more effective service# substituting absolute aircraft by new generation carries etc. !irline companies must avoid pushing productivity so hard that it reduces perceived .uality. They should standardized .uality and thereby increase customer satisfaction.

CIVIL AVIATION
The activities of civil aviation are broadly divided into three areas+ operational# Infrastructural and regulatory cum development. The libation process in civil aviation too" wing in !pril 199/ with the cargo open s"y policy which allowed international airlines to operate cargo flights with cut restrictions and to charge without reference to the 2irectorate Aeneral of :ivil !viation. The air corporation !ct# 190,# replaced on 9arch 1#199;# ended the monopoly of Indian !irlines# !ir India and Cayudoot over scheduled air transport services. *i private operators# who were her to operate as air ta is# have since been granted as scheduled airline status. The competitive environment on domestic service has been# in effect# e isting since !pril 199,. 4y )ovember 1990# 7@ aircraft in the 17/ plus category# belonging to private air ta is# were in operation. The natural conse.uences of creating a competitive environment in this sector was that# by 9arch 1990# ,0.= per cent of the mar"et was being catered to by the private air ta is. The number of passengers carried by air ta i operators has increased from 10#/// in 199/ to ;.1 6a"h in 1997# 79.7 la"h in 199, and ,= la"h during 199;. The year 199;-90 continued to be a difficult year for Indian !irlines 6td. but despite the stiff competition# it has been able to maintain its mar"et share of =,.>H. The operating profit of <s. ,=.; crore which is after lapse of two years# and a net loss of <s. 1@@.>, crore which is <s. =9.>, crore less compared to 199,-9;.

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2uring 199;-90 the company has increased its fares with effect from 70th 8uly# 199; ranging from 1/H to 7/H. 4ut even this was not sufficient to meet with spiraling cost of fuel and oil# airport landing and par"ing fees# interest charges# insurance# depreciation# spare parts repairs etc. which amount for @>H of the total cost and is beyond the control of the company. ?ollowing the all around increase in cost# the company revised its domestic rupee fare with effect from Dctober 1# 1990 by 7/H on an average and revised its dollar fares with effect from 8anuary 1# 199=. The revenue and e penditure of Indian airlines limited during !pril (*eptember 1990 total revenue of Indian airline limited increased by 10.7H whereas the total e penditure increased by 11.07H as compared to the corresponding period of the previous year thereby bringing down the loss from <s. 1,= crore to <s. 11, crore.

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FROM THE COCKPIT

In 19;># there wee 71 registered airline companies in India with a combined fleet of 110 aircraft-most of them 2a"otas. The big names in the business then included ( apart from the Tatas$ eponymous airlines ( 4harat !irways (promoted by the 4irlas)# Drient !irlines# 9istri !irways and 2eccan !irways. *etting up an airline then# was simple. Iou just needed to have the cash. ! 2a"ota aircraft came for <s. 0/#///# while engine fitting and refurbishment$s could set you bac" by another <s. two to three la"h. Aet a coupe of aircraft in place# and you had an airline. Iet# as operators in those early years soon realized# running a airline was not a ca"ewal". ?irst# although aircraft could be bought# efficient managers# pilots and technical staff were not easy to get. 9oreover# the economies of the business was tough. ?ares were regulated by the government# with airlines allowed to charge only 17 per cent higher than first ( class railway fares. This was more often than not uneconomical. !s a result# most private airlines flogged their fleet of aircraft and personnel. 1ilots would cloc" 1=1@ hours a day to ensure that profits accrued. *oon# fuel costs began rising and that too" its toll on airline bottomlines. 4y 190/s# a couple of airlines were li.uidated and then# in 190,# the government decided to nationalize airlines# forming the Indian !irlines :orporation. The new corporation had government support to buy bigger aircraft which flew faster and needed low maintenance. It is ironical# that fifty years later today# a new set of private airlines is realizing that doing business isn$t easy. 1romoters li"e 1arvez 2amania have sold their sta"e in airlines# while others are finding it hard to "eep their aircraft flying. In fact# effectively# of the half-a-dozen new players which were dotting the Indian s"ies after the government open-s"y policy# at least two have operations. ! full circleJ had to terminate

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INDIAN AIRLINES : FLYING STRAIGHT & LEVEL

They came# some faltered# most fell by the side# but while they were there# they managed to sha"e Indian !irlines from its monopolistic complacency# and prepared it to battle for is turf with the li"es of 8et !irways# *ahara and Tata !irlines# if and when they fly. 2amania# 'ast %est# 9odi6uft# )'1:# have all faded out after the initial flourish and the sha"eout in the aviation business in near-complete# and now the s"y is left to the tried# if somewhat tired# Indian !irlines and 8et !irways to e pand and grow. ?or Indian !irlines# which is on course for a modest <s. ;/-;0 crore net profit in 199>-9@ the first time in the last eight years# the last few years have been a revelation. !fter reporting a <s. 11 crore profit in 19@@-@9# Indian !irlines suddenly had seen its mar"et share drop and its uperemacy challenged. 1ilots left the airlines in hordes to more lucrative jobs with the private operators# which resulted in under to offer that little e tra bit that means so much# and Indian !irlines suddenly saw its mar"et share drop to 0, per cent from its earlier unassailable position. :ertain government decisions too# did not help. The sudden grounding of the ! ,7/s after the 4angalore crash# resulting in a <s. 7// crore loss to the airline# besides the merger of the sic" Cayudoot with I! contributed to drag the airline down further. To ma"e things worse the !T? prices zoomed# wage bills increased and landing and navigational charges soared. 4esides# I! because of its social responsibilities# was forced to operate on some

uneconomical routes. In fact 19 per cent of the airlines capacity was deployed on uneconomical routes# while the private airlines chose the trun" routes.
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The I! management realized that the time for complacency was over# and if things were not corrected soon it would go out of hand. I! had several advantages over its competitorsK an established networ"# a strong support system# an e perienced engineering team# and a large fleet with a certain degree of commonality. The first thing that the management under managing director and chairman 1.:. *en did was to establish employee confidence# a new productivity-lin"ed incentive scheme was started# the jet engine overhaul centre in 2elhi was hived off into an autonomous profit centre. ! 1// per cent subsidiary# !lliance !ir# was started in a bid to match the pilot salaries being offered by the competitors. The 17 aircraft 4oeing fleet was transferred to !lliance and pilots and cabin crew were recruited on contract basis# fares# too# were increased. 4esides# several incentive schemes too were started. I! is offering a 70 percent discount on economy class on certain flights in certain sectors. The scheme is valid till !pril# 199@. 4esides# passengers who have flown on any 0 flights of I! or !lliance !ir during the 2ecember 77 to 9arch 71 period are eligible for the new bounty scheme# which offers# as a first prize# an Dpel !stra. 4esides# the joint fre.uent flier programmes together with !ir India too have helped boost I!$s capacity utilisation. Till date I!$s fre.uent flier programme has >/#/// members# not too bad since the scheme itself was a late bloomer. ! new mar"eting strategy too helped put I! bac" on the rails. The airlines decided to increase its international operations# and capture the )<I traffic. The )<I traffic is almost totally with I! because of two reasonsK one the cultural identification factor# and two# because it lin"s smaller towns. I! or !lliance !ir during the 2ecember 77 9arch 71 period are eligible for the new bounty scheme# which offers# as a first prize# an Dpel !stra. 4esides# the joint fre.uent flier programmes together with !ir Indian too have helped boost I!$s capacity utilisation. Till date I!$s fre.uent flier
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programme has >/#/// members# not too bad since the scheme itself was a late bloomer. ! new mar"eting strategy too helped put I! bac" on the rails. The airlines decided to increase its international operations# and capture the )<I traffic. The )<I traffic is almost totally with I! because of two reasonsK one the cultural identification factor# and two# because it lin"s smaller towns. I! can ta"e a passenger closest to his home town. They have also increased their fre.uencies on several sectors# and upgraded their meal services. 4esides# they have underta"en changes in the seating arrangement to provide greater leg room on their flights. !ll these steps helped improve the aircraft utilisation levels from the abysmal low 1=// hours per aircraft per annum to 7>// hours per aircraft per annum. The average passengers flying I! operated 77/ flights to 0@ domestic and 1= foreign designations# too# established at around an average of 7,#///. The load factor too rose to =9->/ per cent as I! once again regained a commanding mar"et share of =@ per cent. ?inancials showed signs of a recovery# while the airline reported an operating loss of <s. >9 crore in 1997-9,# losses dropped marginally to <s. =@ crore in 199,-9;. In 199;-90 I! reported an operating profit of rs. ,=.79 crore# while the ne t year the operating profits mounted to <s. 10> crore. In 199=-9> the operating profits of I! was <s. 1,0 core# while the net losses were down to <s. 1;.0 crore. 4uoyed by the success# I! targeted a profit of <s. 90 crore for 199>-9@ which was later revised to <s. ;0 crore. Df the <s. ;0 crore profit this year <s. 70 crore is e pected to come from the international operations.

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Dnce that target is achieved they are targeting a net profit of <s. =/->/ crore in 199@-99# and once that is reached we will have to loo" at fleet e pansion and modernization. I! proposes to induct fresh aircraft into its fleet in 7///-7//1. It will be phasing out the current 4oeing >,> aircraft# and the 70/ seater !irbus ! ,// aircraft. Th planned growth forecast and fleet e pansion will# however# depend on the 199@-99 performance. Dnce their average load factor reaches >0-@/ per cent# it will be vital for them to increase its fleet

strength# as otherwise# they may have to turn away prospective customers due to flights going full. Dnce that threshold limit is reached I! proposes to lease aircraft on a short ( term basis to augment capacity. The airline has ta"en a decision to induct si 0/ seater aircraft in 199>-9@# and the

government has already allocated <s. ,70 crore for the airlines growth re.uirement which will go towards aircraft procurement. In an attempt to bring in a better wor" culture the airline has also appointed Time 9anagement International to train its personnel# and bring about an attitudinal change in its personnel# the airline is spending <s. 0 crore towards this e ercise and already 9/// people have undergone training. :urrent chairman and 9anaging director 1.:. *en has also had several meetings with the wor"force to force them out of any complacency. There is also a proposal to form a holding company for I!# !I and !lliance !ir as a precursor to a possible merger of the three airlines. The move is e pected to bring in greater economies of scale through optimum utilisation of resources. !s part of the restructuring on the airline# the Gel"ar :ommittee has recommended that as the major reasons for the loses incurred by the

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airlines were also decisions ta"en by the government# the government ought to reimburse the airline for the losses resulting from such decisions# and also provide the airline some additional e.uity and loan. This# the committee felt# would enable the airline to reach a stage where it can pay off the proposed loan and provide a substantial increase in the value of the shares. The committee has also substantial sum through loan restructuring# that the airline loo" at fleet planning # route rationalization# organizational restructuring# industrial relations wages and human resources

management and customer relations. The restructuring plan also envisages a public issue of the airline shares in 1999-7/// after an initial turn ( around and profitability for two years. If the airline is unable to add fresh capacity consistent with e pected mar"et growth# the airline could see its mar"et share dip to ,7 per cent in 1999-7///# and 11 per cent by 7//7-/, when all it$s a ,// and 4oeing >,> would have been phased out# the report has cautioned. The airlines cash deposits would continue to mount reaching over <s. @// crore by 7//7-/,. The airline would need to induct >0 aircraft of varying capacities by the year 7//7-/, in a bid to retain its current mar"et share and recoup its financial health# the report suggests. The report also envisaged that the airline employee accept some deferred payment which would be lin"ed to a turn ( around in the health of the airline. !ccording to the Gel"ar recommendations# the airline would be needing <s. 9// crore in the 199=-99 period to restore its financial health# and initiate fleet e pansion programme.

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In effect# the last two years and newfound competition have helped Indian !irlines recover dramatically from a never ending nose dive. %hile the turbulent period is over there could very well be air poc"ets in its flight path. The coming financial year will determine the course the national domestic carrier will ta"e in the run up to the ne t millenium.

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PRIVATE AIRLINES
*ince its inception in 190, till 1997# Indian !irlines enjoyed a virtual monopoly over the domestic air travel mar"et. In 1997-9,# the situation underwent a change with the !ir Ta i operators putting in substantial capacity on trun" routes. Indian !irlines faced a difficult situation having to share the mar"et on its profitable trun" routes with !ir Ta i Dperators (!TD) and suffering migration of its s"illed personnel to the private operators. 2uring the initial phase of privatization# private operators were allowed to operates as !ir Ta i operators with considerable restrictions on the types of aircraft into India# the route they could operate# etc. *ince 1990# si !TDs were granted to operate as schedule operators. 2uring the initial phase of privatization# private operators were allowed to operate as !ir Ta i operators with considerable restrictions on the types of aircraft into India# the routes they could operate# etc. *ince 1990# si !TD s were granted to operate as schedule operators. Today the Indian s"ies have opened up to operators in the private sector. )D objection certificate have been issued to ,0 for commencement of services. Fleet St e!"t# $% P iv&te Ai li!e O'e &t$ ( )A( 'e *++, N$- .&t&/ )'1: !irlines *ahara !irlines 8et !irways 'ast %est !irlines !rchna !irways 8agson !irlines T$t&l 0 , 17 1/ , , T0'e ?-7>-0// 4->,>-7// 4->,>-,//&;// 4->,>-7// ?-7> 6-71/ 2-77@ N$; 1 11 > , , ,

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?oreign airlines are not allowed to operate in the domestic sector though they are allowed to have a ;/H '.uity sta"e in the domestic airlines. In the recent past 6ufthansa terminated its alliance with 9odiluft. The agreement was terminated in the following areas+ lease contract for the aircraft# crew training agreement# technical service agreement and alliance agreement# which includes the mar"eting aspects. It decided to discontinue its relationship with 9odiluft because the Indian carrier was constantly falling behind in its financial commitments. 6ufthansa also decided to retrieve its three leased 4oeing >,>-7// aircraft from 9odiluft. :urrently 9odiluft$s !ircraft have been grounded.

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NEED FOR CO-ORDINATION

The various domestic airlines are introducing new routes in compliance with the Aovernment policy to regulate air traffic in the country. 6ac" of coordination between the !!I# !ir and )aval head.uarters and private airlines is adversely effecting the operation of some airlines. It is desirable that an annual maintenance plan of airports with pre-determined wor" schedules for underta"ing specific jobsK advance allocation of landing slots at various airportsK provision of office space etc. are decided at the beginning of the year to enable advance planning for smooth operation of various airlines. ! single window committee chaired by the chairman# !!I with representatives of all airlines# !ir ?orce# )avy and A<'? should be constituted to decide such issues.

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OPEN SKY POLICY NOT YET OPEN

%ith the countries private air operators failing to sustain their flight and most of them subse.uently getting grounded#. It is time that the Indian Aovernment reviewed its EDpen *"y 1olicyF. Dn the hope of instilling greater competition in the industry# once dominated by the monopoly of the national carrier# Indian !irline# the Indian government formulated the EDpen *"y 1olicyF. Today# this stands in the cross roads as one by one the private operators are falling from the s"y due to various reasons# primarily their inability to cope with the operation high costs in the industry and are alleging discriminating by the government# over protection of Indian airlines# lac" of level playing fieldK in fact a total lac" of policy and direction by the government. The major problem the private air operators to day are the bitter truths about the highly capital intensive industry# spiraling operational costs# low profits vis-L-vis the massive investments made# caught in the land of high operation ta es and an open s"y and a closed ground# the operators are finding it increasingly difficult to economize their operations# particularly the conditions that force them to fly on non-profitable sector li"e the )orth 'ast# !ndaman and )icobar Islands land the 8ammu region entitled to fly only ;/ of them in the profitable areas# or category 1. Dperators say EThe Dpen *"y 1olicy is open only in the s"y and entirely closed on the ground. There is no policy at all and if at all it is present# there e ists severe discrimination and over protection to the national career. The open s"y policy does not ensure any level playing field at all and it has a lot of discriminatory measure. ?or e ample# by the !ir :orporation !ct# 190,# we are denied the right to fly international routes. 4y forcing us

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to fly repeatedly on the loss ma"ing routes and denying us the right to fly abroad the government is shutting down any chances of a private airline ma"ing in India# The :hairman of 9odiluft# which recently fell out with its international partner 6ufthansa. Indian !irlines authorities are .uic" to defend themselves and the governmental policies. There is any thing wrong with the government$s policy on permitting private sector to enter civil aviation. The policy has not failed while individual airlines have. They have failed because aviation is a highly capital intensive industry and its is necessary to invest in training# maintenance and in building up infrastructure. 9ay of the private airlines tried to operate with a very slim capital base and most of them chose to operate with air-crafts ta"en on lease. They should now demonstrate their capacity to ma"e certain minimum levels of investments re.uired for running a domestic airline. The government must also consider the option of letting the private operators fly international destinations# rather than strictly debar them from doing so. This profit ma"ing move and a cut in the number of flights to the loss ma"ing sectors could augur well for the growth of civil aviation mar"et# which would be a much more healthy scene than having a large number of loss ma"ing and wea" operators.

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ON CLIPPED WINGS AND A PRAYER

In 1997# the government had announced its open s"y policy with a lot of fanfare and hoopla. In its magnanimity the government went to the e tent of allowing ;/H e.uity participation by foreign players. *ome ,/ odd applications poured in and of them eight were short listed and were given licences to start operations. The first blow came with the sale of 2amania !irways. The inflight as well as off-flight service of the airline was simply too early for its time and was too good to last. 2amania$s had also sent salaries of the airline pilot and engineers zooming. 2amania$s e ist however# was not as glorious as his entry into the sector had been. Dvernight# almost he sold his company to the Ghema"as of )'1:# who were emerging as a profitable small craft# short route operator. The only company which seems to b doing well is 8et !irways. The )aresh Aoel run company is planning to ac.uire 1/ 4oeings >,> over the ne t couple of years at an estimated cost of M ,;/ million# and is planning to fly new sectors and introduce more flights on e isting sectors and control 70H of the aviation business. The "ey to the success of 8et has been the code sharing agreements with 9/ international airlines# a well spread out travel agency connection and last but not the least better management. The failure of the Indian companies to capitalize on the open s"y policy is manifold. Industry e perts have to say E they are caught in a vicious circle# on one hand they have to e pand very fast and on the other hand one needs funds to e pand# which the small operators do not haveF. 9ost of the upstart operators do not have the resources to match the fi ed cost

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re.uired for running the show# one of the industry e perts pointed out. The aviation industry is long gestation industry and mot of today$s players do not have the financial strength to "eep going during the initial difficult period. The high cost of fuel too adds to the woes of the private players. Dver and above# the !T? price there is of course the sales ta that many of the state governments levy over and above fuel prices. %hile !ir India buys !T? at 90 per cents plus ta per gallon# the price is >@ per cents gallon in B*!. The tourist traffic too has not grown to the level e pected when the s"ies had been open up# an industry watcher said. %hat perhaps was the last straw was the fact that while the private players were not able to ma"e money on the profitable routes they were re.uired to fly on the non profit sectors. It wasn$t long ago that people were ready to write the obituary of private airlines in India# with most of the new domestic operators staggering under the weight of hefty use rentals and inconsistent government policies# it certainly seemed as though the private airline was as good as dead. The s"eptics were vindicated# in 9odiluft$s technical and management ally 6ufthansa unilaterally terminated its contract with the airlines. Then at the beginning of 8uly# the entire 'ast-%est fleet was grounded for three days for non payment of dues to the !irports !uthority of India (!!I). !t the same time# an aircraft of the 2elhi based !rchna !irways crashed in the Gullu valley. Though nose deep in trouble# all the domestic airlines are now either ac.uiring new aircraft$s or restructuring their business in a last ditch effort to stay afloat and e pand.

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OTHERS IN THE FRAY

MODILUFT 1lans to launch road show for its M0/ million preference share issue to raise funds to re-launch operations in co-operation with 4ritish !irways. The share is e pected to have a face value of <s. 1//. !irline plans to commence operations with ,-; 4oeing >,> ;//s and proposes to e pand fleet to 17. :urrently in tal"s to lease aircraft. 9inistry has# however# not given it the green signal to fly again. 1ET AIR2AYS I!$s main competitor# has a current fleet of 1> 4oeing aircraft (three owned and the rest leased)# which is a mi of >,> ,//s ;//s and 0//s. The airline has entered into a deal with 4oeing to ac.uire 1/ aircraft in the ne t two years# with an option to buy 1/ more subse.uently. The company plans to opt for a mi of leased and owned fleet with the number of leased aircraft coming down with time. 8et owes# its success to better aircraft utilisation# phased ownership of aircraft# and funding from agencies li"e the B* ' im at attractive rates. 8et hopes to achieve a turnover of M7@/ million by !pril-9ay# 199@# up from M7// million last year. 1romoter )aresh Aoyal and associates has in the meantime bought out the ;/ per cent sta"e in Tailwinds. 8et$s holding company previously held by Aulf !ir and Guwit !irways. SAHARA *ahara !irways plans to buy the 0/-seater aircraft and lease three boeing >,>s. The aircraft are being bought of M=> million and will be

26

financed by the ' im 4an" with the payment being staggered over a period of time. :ompany also proposes to buy four helicopters. %ith this e pansion *ahara$s fleet will include seven 4oeing >,>s. TATA AIRLINES The ?I14 cleared the Tata !irlines proposal to induct ;/ per cent foreign e.uity from a non-airline source in its <s. 1;>0-crore venture last month. Tata !irline will have a seven aircraft fleet and will fly 17 destinations in the first year of operations# and 71 destinations in the second year of operations. %ith a <s. =90-crore e.uity it will have the largest capital base in the domestic airline industry. %hile foreign institutions will pump in <s. 7>@ crore as e.uity contribution in the venture. The company will be called Tata !irline 1vt. 6td. It intends to ac.uire 1@ aircraft over a five year period of these two are e pected to be 0/->/ seater# while the rest are going to be 7//-seater aircraft. 'ast %est also has plans of flying again though when is anybody$s guess# )'1: too# plans to rule the s"ies once again though its growth plans too are not yet clear.

27

INDIAN AIRLINES
Indian !irlines# India$s premier national airline# is one of the largest in the world. The airline# which was established in 190,# is wholly owned by the Aovernment of India. The b illi&!t (&"& of Indian !irlines is the story of an organization "eeping pace with the technological advancements in the aviation industry. Indian !irlines today has a fleet of 34 &i 5c &%t( &!. %lie( t$ 36 .e(ti!&ti$!( i! I!.i& &!. *7 &b $&.- ?rom e otic holiday resorts to business centres# remote regions to bustling metros# Indian !irlines# with its modern fleet# connects you to every noo" and corner of India. The airline which has progressed from the era of the piston engined 2a"ota to the fly-by-wire technology of the 9/s in a span of four decades# also pioneered largess scale computerization in the country when a realtime computerized reservation system was established in 19@0. The sage of Indian !irlines began on the 1 st of !ugust# 190,# following the amalgamation of eight private airlines. The journey began with a modest fleet but high aspirations and over the years# Indian !irlines innovated and upgraded its fleet to emerge as one of the largest domestic airlines in the world. Today# Indian !irlines# along with its subsidiary airline# !lliance !ir# provides an e tensive networ" which encompasses the whole of India ( a geographical area e.uivalent to %estern 'urope# besides reaching out to 1> International *tations. Dn its inception in 190,# Indian !irlines too" to the s"y with a fleet that included+ >; 2c-, (2a"ota)
28

, *"y 9aster 17 Ci"ing 0 *entinel 1Twin 4each 1 *ingle 4each Iavro-NIN 12.5. 2ove 1 *aab *afir aircrafts.

! phased fleet modernization programme was started by Indian !irlines with the introduction of Ciscounts in 19>0# followed by ?o""er ?riendship aircraft in 19=1. %ith the arrival of the pilot friendly :aravelle turbo jet in 19=,# Indian !irlines too" domestic aviation into the jet age. In the =/$s the first Indian built aircraft 5* (>;@ (!vro) was inducted into Indian !irlines and the year 19>1 saw the induction of 4oeing >,Hs. In 19>=# Indian !irlines became the first domestic airline in the world to induct wide ( bodied# 7>, seater !irbus. ! ,// aircraft# thus getting new standards in passenger comfort. %ith the introduction of the state-of-the-art. !irbus !,7/ in 19@9 with its fly-by-wire technology# Indian !irlines ac.uired the latest in aviation e.uipment. In the last four decades# Indian !irlines has progressed by leaps and bounds and built an e cellent trac" record of manpower an Infrastructural development. It has thus emerged as a proud symbol of modern India. *ome of the highlights of this glorious period of evolution include+ Increase in passenger carriage from /.0 million in 190;-00 to @ million in 1990-9=. *pread of networ" from 7,#/// "ilometers in 190, to 1#1@#/// "ilometers in 199=. Arowth of assets from <s. 71 million to <s. ,7# /// million.

29

! manifold increase in system seat capacity from ,#/>/ seats per day in 1900 to ,0#>// seats per day.

Indian !irlines possesses an e tensive computerized reservation system to provide online reservations service to its clients. The reservation system is being maintained through a powerful mainframe computer# which is accessed by more than 7/// terminals across the length and breadth of India# apart from the International *tations. !ccess to the reservation system is also available through several hundred travel agencies operating in the country. Indian !irlines participates in the following major :<* in the world thereby providing access to the <eservation *ystem to travel agents around the globe. *abre Aalileo !madeus !bacus %orld *pan Aemini Infini A'T* ! cess

Thus no matter where you may be located in the world# you can boo" a seat on the Indian !irlines flights through the Travel !gents connected to these :<*. *ome of the 1ac"ages offered by Indian !irlines are as follows+ Di(c$ve I!.i& B* M >0/-71 days

30

B* M 0//-10 days The 2iscover Indian ?are is available on our domestic networ"s for unlimited travel in 'conomy class within 71&10 days of the start of the journey provided no city is touched more than once e cept for purpose of transfer&connection. I!.i&! 2$!.e F& e( 8 US 9 :;; E&c# The India %onder ?ares consist of four fares each priced at B* M ,// which allows unlimited travel for one wee" within the )orth# *outh# 'ast or %est India regions. It gives you year round 'conomy :lass travel between any cities in the region of your choice provided you don$t touch the same point more than once e cept for purpose of transfer&connection. Y$<t# F& e 8 43= $%% The India %onder ?ares consist of four fares each priced at B* M ,// which allows unlimited travel for one wee" within the )orth# *outh # 'ast or %est India regions. It gives you year round 'conomy :lass travel between any cities in the region of your choice provided you don$t touch the same point more than once e cept for purpose of transfer& connection. Y$<t# F& e 8 43= $%% !nyone in the age group between 17 and ,/ can avail a 70H discount on 'conomy :lass B* 2ollar fares on our domestic and Indo-)epal *ector. C$>>$! I!te e(t G $<' 8 *;= O%% Aroups travelling together for a common purpose&interest are offered 1/H off on specified international and connecting domestic services. SAARC G $<' E?c< (i$! F& e 8 :;= $%% Dffered on international travel within *!!<: countries (4angladesh# India # 9aldives# )epal# 1a"istan and *ri 6an"a) if touching a minimum of three countries.

31

SAHARA INDIA AIRLINES

*ahara India !irlines started its operation in 2ecember# 199,. Hi"# $! Ac#ieve>e!t( *ahara !irlines has always placed tremendous importance on customer satisfaction. It is because of these efforts that the airline won the %orld Travel 9ar"et 199> Alobal !ward for its .uality of *ervice within the Indian airline industry. This prestigious award was presented at a glittering function at 'arls :ourt# 6ondon on )ovember 1># 199> by :ommissioner :hristos 1apoutsis# *r. 9ember of the 'uropean :ommission. ?iona 8effery# ' hibition director# %orld Travel 9ar"et said# E*ahara !irlines has made innovative steps to upgrade its services in the face of strong competition. It pioneered tele chec"-in at both 2elhi and 9umbai and will shortly introduce it throughout India. *ahara is also on the threshold of a major e pansion programme. !long with the increase in fleet and services# further improvement to cabin services are also planned. Dne of the new features is a OCalet *ervice$ at all airports# where a valet will ta"e care of the baggage for both departures and arrivals. It is for this forward thin"ing creative approach that I am delighted to present *ahara !irlines with %orld Travel 9ar"et 199> Alobal !wardF. Hi"# $! Reli&bilit0 'very year they invest over <s. 0/ crores on aircraft maintenance and computerized inventory to ensure dispatch reliability and on ( time performance. They have a fleet comprising of 4oeing >,> (;// and four new# highly advanced 5elicopters (2auphins and 'curiels). Their engineering department is constantly upgraded with highly advanced test e.uipment re.uired for routine maintenance and heavy chec"s li"e O:$ P O2$ chec"s# engine changes etc.

32

*afety is of prime importance at *ahara# and they are the only domestic networ" with sophisticated# imported e.uipment for through baggage and aircraft chec"s. %ith 2A:! approved maintenance shops# )2T shops# overhauling and test facilities# they offer world class care to their customers. Their reliable service has won them the trust of an International airline li"e 6ufthansa which has entrusted the maintenance and , O:$ chec"s inspection of their aircraft to them. Hi"# $! Q<&lit0 *ahara believe in delivering the best of all its customers. It is this belief that is reflected in all their services. They are among the first to offer the tele chec"-in facility to all their passengers. To ensure smooth baggage handling# e clusive Calet *ervice is provided at all *ahara !irlines airport counters. Their In-flight services are built around total customer care and customer satisfaction. Increased leg space to ensure greater leg room on both *ahara <oyale and *ahara <oyale passengers includes Thai# Italian# :ontinental and Indian :uisine as well as 5ealth meals. They ma"e every effort to ma"e the passengers feel at home# even at great heights. Hi"# $! @&l<e5 A..e. Se vice( ?lying *ahara !irlines has a definite advantage. 4ecause they believe in adding value to their travel. Their special in (flight library gives passenger the option to select and read a range of dailies# boo"s and periodicals. %hat$s more# the *!5!<! :6B4 :<D%) is a uni.ue two dimensional fre.uent flier programme# offering value additions in terms of options for redeeming points against privileges and attractive gifts. The airline has tied up bit names li"e 1ar"er# <ay 4an# Driflame# *ony Genstar# <evlon# *amsung# 1ierre :ardin# %rangler and others. The membership is available at three levels- *ahara *ilver# *ahara Aold and *ahara 1latinum. The membership levels get upgraded depending upon the accumulation of points. Thus# the more passengers travel# the more points they earn.

33

JET AIRWAYS
8et !irways started its operations in 9ay# 199, and are using the latest generation 4oeing >,>-,//$s. They are serving over 10-7/ destinations from its head .uarters. !n overseas corporate body# which enjoys some facilities for investment in India# needs to have a dominant share holding of an )<I# and under the proposal submitted# =/H of the share will be held by 8et !irways :hairman 9r. )aresh Aoyal# who is an )<I year of operators. Se vice ' $vi.e. b0 1et Ai A&0( 1) International standard of aircraft$s flight services 7) :ollecting 9iles. The total number of miles is added up and after a certain limit a ?ree trip is given to the customer. ,) :oncession P discounts to the elderly citizens. ;) The class system in 8et !irways provides different services to customers in terms of food# drin"s etc. 5ard drin"s are also served in 8et !irways in :lub class. 0) Tic"ets are valid for = months in case of rupee fare tic"ets and for 1 year for dollar fare tic"ets. =) 9eals are cartered by the Taj !ir caterres. >) :oncessions *tudents :hild Infant @) 2iscounts and free tic"et to agents 9) :omplimentary dinner and passes for different shows to the agents 1/)*ending mailers and greetings to the people who have flown with them
34

0/H of the basic fare 0/H of the basic fare 1/H of the basic fare

CONCEPT OF MARKETING THE AIRLINE INDUSTRY

The airline industry which is a service-oriented business is difficult to mar"et using only a traditional mar"eting approach. In a product business# the product is fairly standardized and sits on a shelf# waiting for the customer to reach for it. In the airline businesses# the customer confronts the airline whose service .uality is less certain and more variables. !s competition intensified# more mar"eting sophistication will be needed. !irline companies face three tas"s# those of increasing their. (i) (ii) (iii) :ompetitive differentiation *ervice .uality 1roductivity Carious carriers have introduced such innovations as movies on board# advanced seating# merchandise for sale# air-to-ground telephone service and fre.uent (flyer award programs to augment the offer. %hile one airline introduced sparsely costumed cabin crews# another added a piano car. !irline today tal" about adding suit pressing and shoe-spinning services# a library of best selling boo"s and magazines# lap top computers and so on. The only problem is that most of these innovations are easily copied. ?ew of them are preemptive in the long run. *till the airline that regularly researches and develops innovative will gain a temporary advantage over its competitors. In the process they earn innovative reputation and army retain customers who want to go with the best airline. Dne of the major ways to differentiate airlines is to deliver consistently high .uality service than competitors. The "ey is to met or e ceed the

35

target customers service .uality e pectations. 4ut the airlines constantly face trade-offs between customer satisfaction and company profitability. The airline therefore# clearly defines and communicates the service level that will be provided# so that will be provided# so that employees "nown Ewhat they must deliverF and the customers "nows Ewhat they should getF. Bnfortunately# most after the airlines don$t provide what they promise. That third aspect is to increase productivity. This is done by designing more effective service# substituting absolute aircraft by new generation carriers etc. !irline companies must avoid pushing productivity so hard that it reduces perceived .uality. They should standardized .uality and thereby increase customer satisfaction. In the light of the above# we will discuss various aspects of services mar"eting in the following sub-chapters.

36

THE CONCEPT OF SERVICES

To define service narrowly as only relating to service industries is clearly incorrect. Today there is an increasing trend to attempt to differentiate product by service elements. T#e i!t&!"ibilit0 &!. t&!"ibilit0 c$!ti!<<> INTANGIBLE ELEMENTS ________ Baby- sitting ________ Education ________ Legal Se !ice ________ "i t a!el ________ #ast $ood ________ %os&etics ________ So$t d in's ________ %lot(ing ________ Suga TANGIBLE ELEMENT

Bnderstanding the position of a particular service on each continuum# and the position of competitors# is an important step towards finding possible sources of competitive advantage. )ntangibility

)nse+a ability

-(e Se !ice

*ete ogeneity

,e is(ability
37

POSITIONING AND DIFFERENTIATION OF SERVICES

The concept of positioning is a potentially valuable one for service mar"eters since it forces e plicit recognition of the component

characteristics of the overall service concept. :ombining an analysis of customer needs on a segment-by-segment basis with an understanding of competitive offerings enables the mar"eter to identify opportunities for serving a particular segment$s needs better than anyone else. If offering such a service is seen as compatible with the organization$s resources and value# then the firm should be able to develop a profitable niche for itself in the mar"et. 5ere we have to understand that the buyers different needs and hence they are attracted to different offers. It is therefore# important to elect distinguishing characteristics# which satisfy the following criteria. I>'$ t&!ce 8 the difference is highly valued to a sufficiently large mar"et. Di(ti!ctive!e((5 the difference is distinctly superior to other offerings which are available. C$>><!ic&bilit0 8 it is possible to communicate the difference in a simple and strong way. S<'e i$ it0 8 the difference is not easily copied by competitors. A%%$ .&bilit0 8 the target customer will be and is willing to pay for the difference. !ny additional cost of the distinguishing

characteristic(s) will be perceived as sufficiently valuable to compensate for any additional cost. P $%it&bilit0 8 the company will achieved additional profits as a result of introducing the difference

38

IDENTIFICATION OF KEY ATTRIBUTES OF IMPORTNACE TO SELECTED SEGMENTS

Dnce the level of positioning has been determined it is necessary to identify the specific attributes that are important to the chosen mar"et segments. In particular# the way in which purchasing decisions are made should be considered. Individuals use different criteria for ma"ing purchase decisions for a service. The purpose of using the service may change the set of criteria. :ustomers ma"e choice between alternative services based on perceived differences between them. These may not be the most important attribute of the service. !n e ample of this the fact that passengers using airlines ran" EsafetyF as the most important feature. 4ut many airlines have similar standards of safety# so passengers choice of airline will actually be based on other characteristics such as comfort# convenience of flight timings and standard of food and beverage. Thus research needs to identify the salient attributes which determine the selection of the service. Thus will from the basis of the positioning.

39

EXPANDED MARKETING MIX FOR SERVICES

*ervice mar"eting managers have found that the traditional four 1$s of mar"eting are inade.uate to describe the "ey aspects of the service mar"eter$s job. The traditional mar"eting mi is said to consist of the

following elements of the total offering to consumers+ the product (the basic service or good# including pac"aging# attendant services# etc.)K its price# the place where the product is made available (or distribution channels (not generally a real issue for most services# e cept perhaps for repair and maintenance)K and promotion (mar"eting communicationK advertising# public relations# and personal selling). *ome mar"eters suggest that the uni.ue re.uirements of selling services re.uire the manager attend to three additional 1$s. These are people# physical evidence# and process. T#e E?'&!.e. M& Beti!" Mi? %$ Se vice(

,eo+le

, oduct

, ocess

,lace

%usto&e s

, ice

,(ysical E!idence

40

Pe$'le 9any services re.uire personal interactions between customers and the firm$s employees# and these interactions strongly influence the customer$s perception of service .uality. Therefore# management faces a tremendous challenge in selecting and training all of these people to do their jobs well# and perhaps# even more important# in motivating them to care about doing their jobs and to ma"e an e tra effort to serve their customers. !fter all# these employees must believe in what they are doing and enjoy their wor" force they can# in turn# provide good service to customers. 'stablishing a customer-oriented culture throughout the firm and empowering employees to provide .uality service cannot be established merely by putting up inspiring posters. 9anagement leadership# job redesign# and system to reward and recognize outstanding achievement are among the issues that a successful service manager must address. The EpeopleF component of the service mar"eting mi also includes the management of the firm$s

customer mi . 4ecause services are often e perienced at the provider$s facilities# once satisfaction with a service can also be influenced by other customers who are being served there. P#0(ic&l Evi.e!ce This element of the e panded mar"eting mi addresses the EtangibleF components of the service e perience and firm$s image referred to earlier. 1hysical surroundings and other visible cues can have a profound effect on the impressions customers form about the .uality of the service they receive. The EservicescapeF ( that is# the ambience# the bac"ground music# the comfort of the seating# and the physical layout of a service facility ( can greatly affect a customer$s satisfaction with a service e perience. The appearance of the staffK including clothes and grooming# may be used as
41

important clues. 1romotional materials and written correspondence provide tangible evidence of the firm$s professionalism. To the e tent that these elements provide reassurance#. The can be incorporated into the firm$s mar"eting communications to help reduce customer an iety about committing to the purchase. *ervice firms should design these items with e treme care# since they will play a major role in influencing a customer$s impression of the firms. In particular# all physical evidence must be designed to be consistent with the EpersonalityF that the firm wishes to project in the mar"etplace. P $ce(( $% Se vice P $.<cti$! *ince customers are involved in the production of services# the flow and progress of the production process is more important for services than it is for goods. The pace of the process and the s"ill of the providers are both apparent to the customer and fundamental to his or her satisfaction with the purchase. Therefore# when designing service production processes# particular attention must be paid to customer perceptions of that process. ?or this reason# mar"eting and operations are closely related in service management.

42

PROMOTION AND COMMUNICATIONS IN SERVICES MARKETING

1romotion is essentially about communications. Target audiences need to receive information about goods and services before they can begin to consider ma"ing a purchase. 1romotion adds significance to serviceK it can also add tangibility and helps the customer ma"e better evaluation of the service offered. In addition to e ternal communications# internal audiences need good communications if the organizations is going to function in a proper and mar"eting oriented manner. The communication process consists of four main elements. *ource 9essage 9edia selected <ecipient

The whole process is affected by noise or distractions. This distraction can ta"e the form of competition for the recipient$s attention from other advertising or entertainment# for e ample. The promotional message may be designed with one or more aims in mindK To inform To entertain To educate To persuade To remained

The promotional objectives will influence the nature of the promotional message and the type of appeal used to get the message across.

43

1romotional activity is organized in the form of the promotional mi within the mar"eting mi . The elements# which ma"e up the promotional mi are as followsK !dvertising 1ersonal *elling 1ublicity J1< *ales promotion %ord of mouth 2irect mail

Dne of the "ey tas"s in designing and e ecuting promotional programmes is the selection of appropriate media for advertising and other forms of communication. The range of possible media choice is e tensive but will ultimately be governed by factors such as the budget available and the target audience profile. The development of an effective promotional campaign involve combining the promotional mi elements in the most appropriate way to meet the organization$s communications objectives. 1romotional

management is concerned with this tas" co-ordinating and implementing promotional programmes# integrated within organizational mar"eting programmes. Devel$'i!" & >e((&"e ! number of customers response models have been developed. Dne of the most common is the !I2! model# which suggests that the buyer moves through from stages of attention# interests# desire and action. 2evelopment of the message involves consideration of which of these !I2! tas"s to be

44

emphasized. This will depend on how well a company$s services are "nown and customers perception of them. 2evelopment of a message involves a consideration of four issues. 9essage content ( what to say 9essage structure ( how to say it logically 9essage style ( creating a strong presenceK and 9essage source ( who should develop it. Ta"ing care of the above mentioned activities# should help to ensure that well defined communications objectives are met# the targeted audience receives the message correctly and the available budget has been utilized effectively.

45

GUIDELINES OF SERVICE COMMUNICATION

*ome of the distinctive characteristics of services suggest that a different approach is needed to communication strategy. In particular# wellplanned and e ecuted promotions represent an important tactical weapon to service mar"eters in their search for profitability and competitive advantage. There are si guidelines for service advertising based on some of the special characteristics of services. P $vi.e t&!"ible cl<e( : ! service is intangible in the sense that a performance rather than an object is purchased. Tangible clues. M&Be t#e (e vice <!.e (t$$. : *ervice may be difficult to grasp mentally because of their intangibility. Tangible attributes of the service can be used to help better understand the service offered. :ommunications continuity+ This is important to achieved

differentiation and present a unifying and consistent them over time. P $>i(i!" A#&t i( '$((ible: *ervice firms need to deliver on their promises. If a promise such as fast delivery cannot be consistently met it should not be made at all. ?or e ample Indian !irlines should not ma"e promises for an time

arrivals or departures if they are not able to fulfill it. C&'it&liCi!" $! A$ . $% >$<t#: The variability in services

contributes to the importance of word of mouth. %ord of mouth is a vitality important communication vehicle in services# as evidenced by the way we see" personal recommendations for lawyers# accountants# doctors# hairdressers# ban"ers and airlines. Di ect c$>><!ic&ti$! t$ e>'l$0ee( : In high contact services advertising should be directed at employees to build their motivation# as well as to customers. The notion behind this is closely tied to internal mar"eting.

46

MARKETING PLANNING PROCESS

1hotostat The mar"eting planning process provides structure and direction for mar"eting activities and should be underta"en as a medium to long-term commitment not# as is fre.uently the case# on a piecemeal short-term basis. In order for mar"eting plans to be successfully e ecuted# however# the efforts of all employees need to be co-ordinated. 'ffective implementation can be aided by. Internal mar"eting 9otivation and leadership 'ffective communications :o-ordination of the mar"eting tas"

9onitoring is critical to the successful implementation of any plan and control mechanisms should be built into the plan to ensure prompt attention and action if the plan lags behind targets setK 'ffective control can be established using the following "ey stepsK 'stablishing re.uired performance targets 9onitoring performance against targets 2esigning corrective courses of action where re.uired :ontingency planning

The mar"eting planning process is especially important for the airline industry because if any airline misses out on any of the above points# it can go in red. !ll the four phases which are mentioned in the mar"eting

47

planning process are of utmost importance for survival in the airline industry.

INTERNAL MARKETING
?or many services# employees remain the primary ingredient of success in the moment of truth. In many service industries any competitive advantages obtained through innovative service design are usually momentary impossible. The real source of competitive advantage is in the unmatched service attitude of the firm# specifically its frontline personnel. Therefore# formal designs of the service process are not enough to guarantee the .uality of moments of truth. 9anagement must be sensitive to the intangible aspects of the services# particularly the service orientation of its frontline personnel. It is management$s job to engender and continuously rejuvenate a customer ( oriented culture at every level of the firm. 9anagers and supervisors are responsible for establishing the organization$s common values about service through strong leadership. 4y setting a good e ample and offering meaningful support and constant encouragement# the firm$s management can do much to determine the attitude of employees when they face customers. ! .uality revolution cannot be maintained only by management$s demonstrations of enthusiasm. ?rom programmes are also needed. EInternal mar"etingF is a term commonly used to describe the programs necessary to in still and maintain a strong service mentality throughout an organization. Internal mar"eting programs have several purposes. ?irst# they guarantee that all employees have a firm understanding of the structure of the business# its mission# and its customer ( orientation. *econdly# these programs should be designed to

48

"eep employees motivated and suitably trained to act in service-oriented ways. ?inally# they can be very helpful in attracting and "eeping good employees. Typical components of an internal mar"eting campaign include the following. T &i!i!" : Training must focus on two different types of programs to "eep employees in top shape as part-time mar"eters. They need to be given the technical "now ( how to do their jobs# but they also need to be steeped in the customer- based culture of the firm. To produce the "inds of employees necessary to deliver top-.uality service# neither can be overloo"ed. Training frontline personnel in high-contact services should include interpersonal s"ills as well as technical performance s"ills. In particular# a good server must be able to identify what a customer wants by as"ing .uestions and listening carefully# and should be able to communicate to customers a sincere concern for their satisfaction. C$!ti!<$<( i!te &cti$! Ait# >&!&"e>e!tD(: Training can only go so far. 'ach employee has different personal needs for information and motivation that uniform training programs can$t be e pected to identify. It is management$s job to e tend the formal training through continual support# assistance# motivation# involvement in decision ma"ing# setting of e amples# and rewarding of good performance. I!te !&l >&(( c$>><!ic&ti$! : Internal communication is one way to reach large numbers of employees with information that supports the service environment# shares information on new ways of satisfying customers# and so on. 2istributing or posting a regular newsletter recognizing e cellent performance by employees and containing letters of

49

complaint and praise from customers is a good way to "eep employees informed. M& Beti!" Re(e& c# : 8ust a I would be foolish to attempt to mar"et to end customers without researching their needs# desires# and perceptions# it is just as foolhardy to fail to research one$s employees. 'mployee attitudes and their willingness and ability to perform certain roles in the planned mar"eting strategy must be understood if the internal mar"eting programme is to be effective. 9oreover# research into employee e periences and opinions about the service delivery is also a vital# and toooften overloo"ed# sources of information about how to improve the service to e ternal customers. Ot#e #<>&! e($< ce &ctivitie( : 9any activities ensures that the proper personnel are being hired and retained. Therefore# it is difficult to separate personnel policies from mar"eting strategy in a service firm.

50

EFFECTIVE CUSTOMER SERVICE ORGANISATION

F&ct$ ( S#&'i!" t#e C<(t$>e Se vice F<!cti$!( P e(e!ce $ &b(e!ce $% i!te >e.i& ie(: *ome customer ( contact tas"s are often more efficiently performed by intermediaries. Bsually these relate to initial contacts by customers prior to delivery of the core service. ' amples include travel agents and threater tic"et agencies that provide information and advice ma"e reservations# and collect payment. Hi"# c$!t&ct ve (<( l$A c$!t&ct : The more involvement the customer has with the service firm# the greater the number of customercontact points and the more li"ely these are to ta"e place in locations that are geographically far removed from the head office. This situation offers more opportunities for mista"es or poor service to occur and is thus more comple to manage. 4y contrast# low contact services entail few

interactions with customers# with contacts often being limited to mail and telephone interactions with personnel located in a central office# where management controls can be much tighter. C&'&cit0 8 c$!(t &i!e. (e vice(: In most instances# this group of services will need to offer either a reservation system of a .ueuing ( control mechanism. The former re.uires online access to a reservations data base# and is usually handled by telecommunications# the latter re.uires friendly but firm interactions with customers standing in line and realistic projections of the estimated wait for service. F eE<e!c0 $% <(e &!. e'< c#&(e : %hen the bul" of consumption is accounted for by repeat use# it is important to separate proactive selling (which is e pensive and re.uires more training) from simple order ta"ing .
51

De" ee $% i(B: *ervice managers must understand the conse.uences for customers of a service failure. :ontingency planning is often re.uired by government regulation where personal safety is a factor. Dther conse.uences for customers may range from personal inconvenience to monetary loss. The higher the probability of a service failure and the more serious the conse.uences# the more important it is to employ mature# well ( trained contact personnel who not only behave calmly and tactfully when faced by upset customers# but also wor" to resolve the problem as .uic"ly as possible.

52

AVOIDING THE CUSTOMRE BLIND SPOT

In every case the organization is doing good things# but develops a fatal blind spot. The blind spot generally involves a customer group that has been ignored or whose needs have not bee met. If sufficiently important and sufficiently neglected# one customer group is enough to destroy the organization$s effectiveness. *ystematic attention to customer groups is re.uired to avoid the customer blind spot. The following figure gives a systematic approach for maintaining customer relationships with the "ey customer groups. MAINTAINING CUSTOMER RELATIONSHIPS

)denti$y custo&e g ou+s

"ssign i&+o tance to eac(

,lan elations(i+ &aintenance acti!ities $o eac( g ou+

%ulti!ate elations(i+s .onito elations(i+ (ealt(

)denti$y + oble&s and o++o tunities

53

RELATIONSHIP MARKETING
The relationship can be seen to be the core focus for the organization see"ing to enhance customer service and mar"eting orientation through relationship mar"eting. <elationship mar"eting does embrace mar"eting concepts which have evolved during the latter half of this centuryK and it ta"es them further. !s customer sophistication increases# organizations are having to communicate far more# and more widely than before# especially with regard to environmental or societal issues. 1utting this communication into the conte t of relationship mar"eting ma"es sense. The idea behind relationship mar"eting is to build relationships with the organization$s publics ( or# at least# those groups which are the main influencers# for e ample. <elationship with channel members <elationship with customers and potential customers <eferral mar"ets Internal mar"ets and potential employees Influencers

:ustomer retention is a "ey focus of relationship mar"eting as well as .uality and enhanced customer services. <elationship mar"eting is especially relevant to services mar"eting and to particular areas within services mar"eting.

54

PRICING THE SERVICE

1ricing is an important element in the mar"eting mi . It reflects the value attached to it by the service provider and it must correspond with the customer$s perception of value. There are many pricing concepts and techni.ues which organizations may use in developing their pricing policy # including. 1rice s"imming 1enetration pricing 9i ed pricing :ost-plus pricing Cariable pricing 9arginal pricing 1romotional pricing 2ifferent pricing Carious factors influence the overall pricing strategy. The organization$s objectives and degree of profit orientation are obvious e ample but other considerations include+ :osts of producing the service&brea"even analysis :ompetitor pricing 2emand levels and elasticity 2emand levels and elasticity <egulatory factors 9ar"eting mi 1ositioning

In services mar"eting pricing decisions can be highly comple . Drganizational objectives are major factors in deciding upon a pricing strategy and when objectives are set# the potential impact on pricing should be considered. 1ricing policy will be subject to continual development as prices fluctuate over time. ! frame wor" for pricing decisions should be

55

monitored continuously to allow for responsive action and adaptation when re.uired.

56

CONSUMER BEHAVIOUR IN SERVICES

Intangible# heterogeneity# and inseparability of production&consumption lead services to possess high levels of e perience and credence properties. %hich in turn ma"e them more difficult to evaluate than tangible goods. :onsumers go through a decision-ma"ing process that can include upto five steps. These are as follows+ 1. )eed recognition The customer has a need to fulfill or a problem to solve 7. Information search The customer see"s out information to help satisfy the need ,. 'valuation of alternatives The customer selects a subset of the alternatives and evaluates them ;. 1urchase The customer choose a particular brand and then buys it 0. 1urchase outcome The customer evaluates the choice made and decides whether it lives upto e pectations. To be effective# service providers may need to alter their mar"eting mi es to recognize different consumer behavior and evaluation processes.

57

DIFFEREING ROLE OF PEOPLE

:ontractors have fre.uent or regular customer contact and are typically heavily involved with conventional activities 9odifiers are people such as receptionists# credit department and switch board personnelK while they are not directly involved with conventional mar"eting activities to a great degree# they

nevertheless have fre.uent customer contact. Influencers perform various support function and have neither fre.uent customer contact nor a great deal to do with the conventional mar"eting activities. This involves a point that the people are an indespenciable part of any organization more so of any service organization. This can be further shown by the following matri . EMPLOYUEE INFLUENCE ON CUSTOMER Involved with conventional mar"eting mi ?re.uency or periodic customer contact )ot directly involved with mar"eting mi

:D)T<!:TD<*

9D2I?I'<*

Infre.uent or no customer contact

I)?6B'):'<*

I*D6!T'2*

58

MANAGING DEMAND AND CAPACITY

4ecause service organizations lac" the ability to inventory their products# the effective use of capacity can be critical to success. Idle capacity in the form of unused time# labour# facilities# or e.uipment represents a direct drain on bottom-line profitability. %hen the capacity represents a major investment# for e ample# airplanes# e pensive medical imaging e.uipment# or lawyers and physicians paid on a salary# the losses associated with under use of capacity are even more accentuated. Dverused capacity is also a problem. 1eople# facilities# and e.uipment can become worn out over time when used beyond optimum capacity constraints people can .uit# facilities become run down# and e.uipment can brea". ?rom the customer$s perspective# service .uality also deteriorates. ?or organizations focused on delivering .uality service# therefore# there is a natural drive to balance capacity utilization and demand at an optimum level in order to meet customer e pectations. *trategies for matching demand and supply fall under two headings. (1) 2emand strategy (shifting demand to match capacity) ( demand strategies see" to flatten the pea"s and valleys of demand to match the flat capacity constraint. (7) *upply strategy (fle ing capacity to meet demand) ( supply strategy see" to align# fle or stretch the fi ed capacity to match the pea"s and valleys of demand. 6ong practiced by the passenger airline industry# yield management was presented as a sophisticated form of supply and demand management that balance capacity utilization# pricing mar"et segmentation# and financial return.

59

In the unresolved capacity-utilization situations# the inevitable result is customer waiting. *trategies for effectively managing waiting lines are described as + employ operational logicK establish a reservation processK differentiate waiting customers# and ma"e waiting fun# or at least tolerable.

60

CENTRAL ASSUMPTIONS AND GUIDING PRINCIPLE FOR EMERGING VIEW

ASSUMPTIONS 1. The first assumption is that every organization is a service. 4y this we do not mean that every organization avoids physical products. <ather# what we mean is that although not every company produces a physical product# every company produces a service. 7. The second assumption is that the primary purpose of any organization is to satisfy its customers. This ensures that satisfying customers will become the leading priority of organizations if there is a competitive mar"et. *ince it has been seen that mar"ets are increasingly becoming global# as information transfer becomes more efficient and as intangible goods become a larger percentage of the economy# we "now that mar"ets are becoming increasingly competitive# and therefore# satisfying customers will become more and more important in the coming years. ,. The third assumption is that customer requirements are constantly changing. 9anagement must continually adapt to a changing mar"etplace because the only constant is change. Thus a premium is placed on continuously monitoring and adapting to the changing mar"etplace. ?or this reason these issues are given increased emphasis in the emerging view of service mar"eting. It is important to recognize that the assumption of constantly changing customer needs is increasingly true over time. GUIDING PRINCIPLES 1. The first principle is to improve service continually. )o matter how good a job the organization is ding of supplying service# it must continually improve. This is essential because of the assumption that customer re.uirements are constantly changing. !s a result# what is good today may be bad tomorrow. *ervice must change to

61

accommodate changing customer needs. )ote that the emphasis is somewhat changed from the manufacturing .uality control concept of continual improvement. 5ere our emphasis is on customers and their changing needs# rather than the efficiency of internal processes. 7. The second principle is to concentrate on the areas most important to customer retention. This principle consciously rejects the idea of improving everything all that once. <esources are instead focused on the areas that will have the greatest impact. The emphasis is also on customer retention rather than customer attraction since the bottom line measure of customer satisfaction is usually customer retention. The third principle is to use customer satisfaction to expand revenues. <evenue e pansion results from customer satisfaction through the mechanisms of customer retention and word of mouth. The fourth principle is to make sure that service improvement efforts are financially accountable. )ot all service improvement efforts pay. !ny e penditure for the improvement of service may be viewed as an investment. *ince the primary purpose of the organization is to satisfy its customers# and one of its important customer groups is its shareholders# investments made by the firm must satisfy return targets set by the shareholders. Thus e penditures must all be made with consideration of the rate of return# and service improvement efforts are no e ception. The fifth principle is to delight-not just satisfy-the customer. 9ere satisfaction is generally thought of as resulting from problem avoidance. 4ut all good organizations see" to avoid problems# which means that in many mature mar"ets the surviving competitors will all be relatively problem-free. This means that any competitive advantage from customer satisfaction will often have to be based on a higher order of

62

customer satisfaction# which is commonly called Ecustomer delightF# and arises from surprising and e ceptional service. A BLUEPRINT FOR SER@ICE MARKETING MANAGEMENT The emerging view of service mar"eting is increasingly customeroriented# with relatively more attention paid to retaining e isting customers than to attracting new ones. The reason for this is economic. It is well "nown that most business find it several times cheaper to retain an e isting customer than it is to attract a new one. The blueprint for service mar"eting management that arises from this realization is therefore much more concerned with "eeping customers happy. The tas"s in the following figure are listed roughly in the logical order in which they would become accomplished by a start-up organization# although an ongoing organization would essentially do all of these things continuously. A BLUEPRINT FOR SER@ICE MARKETING MANAGEMENT
#ocus t(e o gani/ation

"tt act custo&e s Listen to t(e %usto&e

.easu e custo&e satis$action 0ete &ine $inancial i&+act )&+ o!e se !ice Loo' to t(e $utu e

63

CONCLUSION
The parameters on which each of the airlines under focus is rated best are as follows. Ai li!e( 8'T !I<%!I* I)2I!) !I<6I)'* *!5!<! !I<6I)'* Interior ?ood Around *upport *taff *taff Bniform 2estinations :overed *afety 2iscounts ?re.uency of ?lights :ourtesy 4aggage 5andling P& &>ete ( 1romptness of service

In the other parameters i.e. promptness of service# ?ood# Around *upport *taff# *taff uniform *ahara is rated closely to 8et. I!.i&! Ai li!e( Indian !irlines officials have themselves realized the gaps in their service and have fortunately risen to amend them. They have initiated a few steps li"e+ Increasing fre.uency on several sectors Bpgrading their meal service They have made changes in the seating arrangement to provide greater leg room on their flights. The most important step underta"en is an attempt to bring better wor" culture and for this the airline has also appointed Time 9anagement International to train its personnel.

64

S&#& & Ai li!e( To overcome its main problem of having only ; aircrafts in its fleet# *ahara plans to buy five 0/ seater aircrafts and lease , 4oeing >,>$s. 1et Ai A&0( Though in the present scenario# 8et !irways is leading in the services offered# but in order to remain competitive it must "eep itself aware of all the upgradation ta"ing place in other airlines and be on its toes to continue performing and improving its services even better. This study is only a beginning and aims at identifying the gaps in the services delivered. ! further detailed study would be carried out in the future to bridge the gaps identified in this project.

65

LIMITATIONS
In my study that is conducted# researchers always come across some limitations. This study was no e ception to the rule. 1. The study is limited to 2elhi only. 7. *ample size is small so it affects the generalisability of the study. ,. 6ac" of time was a major constraining factor ;. 9ost of the concerned people were so busy that they didn$t have .uality time to fill the .uestionnaire judiciously and give detailed information. 0. The respondents were .ualified to fill the .uestionnaire even if they had flown in the airlines in focus# even once.

66

SURVEY ANALYSIS
The airline industry has seen major changes since the opening up of the Indian economy and the economic liberalization ta"ing place since 1991. The customer has become more aware and selective in his&her decision ma"ing. This process of liberalization has resulted in the organization becoming more customer oriented and focussed in order to survive in the era of confused and diffused mar"et place that is evolving faster that the airlines that are populating it. The best defence then for an airlines is to be an edge over others. %ith this prerogative I have underta"en the study to evaluate and analyze the service delivery gap in the airline industry. That means to infer a step by step method of finding customers e pectations in the airlines they travel in and e.uating them with the services actually provided. 9y research was conducted in 2elhi with the sample size of 1// respondents. The respondents were who had travelled by the airlines under consideration. The analysis of my study revealed that the awareness level of airlines under consideration (Indian !irlines# 8et !irways# *ahara !irlines) was 1//H. The respondents have travelled with Indian !irlines more in comparison to 8et and *ahara. The study revealed that about ;7H of the respondents travelled most fre.uently with Indian !irlines# ,,H with 8et and the remaining 70H with *ahara. There were about ,,H of the

respondents whose income level was between <s. 1/#/// to <s. 70# ///&-. !lthough the income level of the respondents in the strata of <s. 70#//1;/#///&- was relatively less. It was about 77H. !fter analyzing the demographics of the respondents I tabulated that ma imum number of people who travel by air of Ewor"ing professional classF. Their percentage

67

was about 00H. The others topping the list were from the 1rivate *ector with a percentage of 7>H. The self employed and the government service category didn$t have much share. Their respective shares were 1=H and 9H. 9a imum number of respondents were in the age group of ,=-0/ years. Their percentage was ;;H. The respondents are as"ed the fre.uency of their air travel and the study revealed the fact that ma imum number of people were used to travel by air ,-; times in year# rather than 1-7 times a year. There were about 79H people who travelled by air more than = times a year. :oming on to choosing the airlines the respondents are as"ed to ran" 1, parameters which the customers usually give weightage while selecting a particular airline. These parameters varied from safety# punctuality to discounts offered and also the aesthetics of the people delivering the service. Though my study revealed that the discount offered by an airline was 17th in the ran"ing i.e. the 17th least preferred parameter for ma"ing a choice. :ontradictory to this# my interactions with the airline officials and people from the travel related services revealed that most of the customer especially the self employed were attracted most by the time to time promotional campaign offered by the industry# most of which were different pac"ages which incorporated the discount factor to a greater e tent. 5ence# I concluded that most of the respondents were judiciously rate this factor in their list of priorities. The respondents rated safety level to the most important criteria which was followed by punctuality# ease of tic"eting and reservation procedures. ?ood and fre.uency of flight also mattered to them. Though baggage handling and destinations covered are important parameters but not many respondents cared about it. hesitant to

68

*taff uniform as per the respondents didn$t carry much weightage in comparison to the other listed parameters# although attributes such as the staff uniform play a major role towards tangibilising the service in the present scenario where the airlines are getting more customer oriented and attuned to the needs and wants of their prospective customers. This spelled the difference in perception between the service delivery provider and the actual customer. !ccording to me the reason# after analyzing this fact# was that other attributes put forth of the respondents carried more weightage while deciding upon the airlines they wanted to travel with. Dther findings which were arrived upon after analyzing the ran"ings given to the various listed attributes across the , airlines in focus are as follows+ 1. Punctuality It was seen that 8et !irways ran"ed first with respect to punctuality followed by *ahara !irlines and Indian !irlines. 9ost of the people said that very purpose of travelling by airlines is defeated if the time saved in travelling is consumed in waiting. 7. Promptness of Services !part from overall promptness of service which 8et !irways performs dependably most people also related to their positive personal e periences with respect to both 8et and *ahara# and almost none to Indian !irlines. ,. Courtesy *ahara !irlines featured the best on this parameter# followed by 8et and Indian !irlines. 9ajor reason for the above result was that the flying staff of

69

*ahara didn$t believe in satisfying the customer# they believed in delighting the customer. ;. eservation and !icketing 8et and *ahara ran" very closely on this parameter with Indian !irlines lagging behind. The difference creeps up only in the way <eservation P Tic"eting are handled when interacting with the customer and these interactions are of a far superior level for 8et and *ahara. 0. Safety !s e pected safety was ran"ed the number one parameter while choosing an airline and Indian !irlines caters the best to this need of the customer# followed by *ahara and 8et. 1robably# this is the single main reason that e plains the good traffic attracted by Indian !irlines# despite other airlines having edge in the service area. =. "nteriors This parameter invited most open and detailed answers. 1eople could actually point out the shortcomings in Indian !irlines li"e dull colour combinations in comparison to the fresh colour loo"ing maintained by 8et and *ahara. Thus 8et was ran"ed first followed by *ahara and Indian !irlines. >. #ood 9eals provided by 8et !irways are far superior in .uality and taste and compared to meals provided Indian !irlines. 3uality of meals provided by *ahara was also appreciated but 8et scored better because of the variety it provides and this was reflected by the fre.uent fliers.

70

@. $round Support Staff 8et again ran"ed first under this attribute followed by *ahara and Indian !irlines. The ground support staff is 8et !irways is helpful and courteous to the e tent that whenever possible they try to convey and delays# change in timings etc. for the convenience of the customers. 9. #requency of #lights *ahara lags in this parameter as compared to other two airlines because its fleet has a total of ; aircrafts when compared to 1> aricrafts of 8et !irways and =9 of Indian !irlines. Indian !irlines ran"ed first on this parameter followed by 8et and *ahara. 1/. %estinations Covered Indian !irlines ran"ed first on this parameter covering ma imum destinations when compared to 8et and *ahara. Indian !irlines covers not only the trun" routes but also uneconomical routes solely for the benefit of its customers. !lso the )<I traffic is almost totally with Indian !irlines firstly because of cultural identification factor but more importantly it lin"s smaller towns. 11. &aggage 'andling *ahara ran"ed first followed by 8et and Indian !irlines on this parameter. The main problem faced by customer is that after reaching the destination# they have to wait for their baggage. !nother dimension to this attribute is the damage done to the baggage in transit which is least in the case of 8et and *ahara.

71

17. Staff (niform 8et ran"ed first on this attribute followed by *ahara and Indian !irlines. 8et without any doubt leads on this parameter- courtesy to its bright blue and yellow uniform which apart from being pleasing is very smart. 1,. %iscounts ?re.uent fliers and self employed are the people to whom this parameter would matter the most. Indian !irlines leads followed by *ahara and 8et. Indian !irlines offers various pac"ages in which discount factor is incorporated to a large e tent. C$>>e!t( The above ran"ing has been done on a ; point scale ta"ing E1F ' cellentK E7F Aood# E,F *atisfactoryK and E;F Bnsatisfactory.

72

BIBLIOGRAPHY
4usiness India# 9ay ;-># 199@. 8'T%I)A*# ?eb.# 1999. 8'T)'%*# ?eb. 1999

73

QUESTIONNAIRE

1. I generally travel by Indian !irlines *ahara India !irlines

8et !irways

7. The fre.uency of my flights in a year vary from Dnce a wee" Dnce a 9onth Dnce in si month Dnce a year !ny other (please specify) ,. I am impressed by the punctuality of the flights of my choice of domestic airlines. *trongly !gree 9oderately !gree *trongly 2isagree 9oderately !gree In different ;. The staff of !irlines is :ourteous *trongly !gree *trongly 2isagree In different

9oderately !gree 9oderately !gree

0. I find it easy and convenient to ma"e reservations. *trongly !gree 9oderately !gree *trongly 2isagree 9oderately !gree In different =. The safety norms are abided by *trongly !gree *trongly 2isagree In different

9oderately !gree 9oderately !gree

>. The !irlines of my choice is prompt in providing their services. *trongly !gree 9oderately !gree *trongly 2isagree 9oderately !gree In different @. The interiors of the !irlines are polite and pleasant. *trongly !gree 9oderately !gree *trongly 2isagree 9oderately !gree In different
74

75

9.The food served in the !irlines is of high .uality. *trongly !gree 9oderately !gree *trongly 2isagree 9oderately !gree In different 1/. The ground staff of the !irlines is helpful and courteous. *trongly !gree 9oderately !gree *trongly 2isagree 9oderately !gree In different 11. The !irlines covers not only the trun" routes but also uneconomical routes solely for the benefit of customers. *trongly !gree 9oderately !gree *trongly 2isagree 9oderately !gree In different 17. I feel totally secure will my baggage in the hands of the !irlines. *trongly !gree 9oderately !gree *trongly 2isagree 9oderately !gree In different 1,. The staff uniforms are sophisticated and smart. *trongly !gree 9oderately !gree *trongly 2isagree 9oderately !gree In different 1;. The !irlines offers various pac"ages in which the discount factor is incorporated to a large e tent. *trongly !gree 9oderately !gree *trongly 2isagree 9oderately !gree In different 10. The fare charged by the airlines is justified to the services rendered. *trongly !gree 9oderately !gree *trongly 2isagree 9oderately !gree In different

76

ACKNO2LEDGEMENT
1roject wor" is never the wor" an individual. It is more a combination of views# ideas# suggestions# contributions and wor" involving many individuals. I am e tremely than"ful to 1rof. C!)''T! 9!65DT<!#

1rof. *5!I6')2<! T!)2D) P 1rof. )!C8IDT5# my internal project guides for their valuable support and e ceptional guidance throughout my project. I e press my gratitude for their continuous support without which this project could not have reached a successful completion. I am also than"ful to 2r. !.G. *I)A5# 1resident# 2elhi *chool of 1rofessional *tudies and <esearch# 2r. 1.). *I)A5 and all other faculty members for their constant guidance and motivation. I would also li"e to a avail this opportunity to than" 9r.*.1. *ingh of the !irport !uthority of India. 9r. <ajiv Aoel of 8et !irways and 9r. 8aideep of the *tatistical cell of the International !irport !uthority. !ll the above the made a considerable contribution to which these few lines can hardly do justice to their unflagging patience and generously given support. 6ast but not the least# I am than"ful to all my friends for their continuous encouragement.

)1ASLEEN 1OLLY/

77

A PROJECT REPORT
ON

AIRLINE INDUSTRY IN INDIA

Submitted by: 1ASLEEN 1OLLY

R$ll N$- ++FDPFBBAF*:

78

DELHI SCHOOL

OF PROFESSIONAL RESEARCH

STUDIES &

79

TABLE OF CONTENTS
P&"e N$OB1ECTI@ES EGECUTI@E SUMMARY CHAPTER 8 * INTRODUCTION METHODOLOGY CHAPTER 8 4 INDUSTRY PROFILE a) !irline Industry in India + ! 4rief Introduction b) :ivil !viation c) ?rom the :oc"pit d) Indian !irlines + ?lying *traight P 6evel e) 1rivate !irlines f) )eed for :oordination g) Dpen *"y 1olicy h) Dn :lipped %ings a 1rayer i) Dthers in the ?ray j) Indian !irlines ") *ahara Indian !irlines l) 8et !irways CHAPTER 8 : TEHORETICAL FRAME2ORK a) :oncept of 9ar"eting in the !irline Industry b) :oncept of *ervices c) 1osition and 2ifferentiation of *ervices d) Identification of Gey !ttributes of Importance to *elected *egments ,/ ,7 ,, ,; 7 0 > @ 1; 1= 1> 19 71 7, 7> 79 1

80

e) ' panded 9ar"eting 9i for *ervices f) 1romotion and :ommunication of *ervices g) Auidelines of *ervice :ommunication h) 9ar"eting 1lanning 1rocess i) Internal 9ar"eting j) 'ffective :ustomer *ervice Drganization ") :ustomer 4lind *pot l) <elationship 9ar"eting m) 1ricing the *ervice n) :onsumer 4ehavior in *ervices o) 2iffering <ole of 1eople p) 9anaging 2emand and :apacity .) :entral !ssumptions and Auiding 1rinciple ('merging Ciew) CHAPTER 8 6 CONCLUSIONS CHAPTER 8 3 LIMITATIONS CHAPTER 8 , SUR@EY ANALYSIS BIBLIOGRAPHY ,0 ,@ ;1 ;7 ;, ;= ;@ ;9 0/ 01 07 0, 00 0@ =/ =1 =>

81

CERTIFICATE

82

ACKNOWLEDGEMENT

83

OBJECTIVES

84

EXECUTIVE SUMMARY

85

INTRODUCTION

86

RESEARCH METHODOLOGY

87

INDUSTRY PROFILE

88

THEORETICAL FRAMEWORK

89

CONCLUSIONS

90

LIMITATIONS

91

SURVEY ANALYSIS

92

BIBLIOGRAPHY

93