A

REPORT ON

BY
DEBJIT SAHA
MKT+IB-2009-11
ROLL NO -1999/09040040

SUBMITTED TO
SURYADATTA INSTITUTE OF MANAGEMENT & MASS
COMMUNICATION
BAVDHAN
PUNE-21
MAHARASTRA
YEAR OF SUBMISSION 2010

INTRODUCTION
Singapore Airlines (SIA) began in 1947 as Malayan (later
Malaysian) Airlines in a joint venture between the
Malaysian and Singapore governments, serving primarily
the South East Asian region. In 1965, Singapore
separated from Malaysia, and later the two governments
agreed to set up separate airlines. Singapore Airlines was
born in 1972. Singapore Airlines was in a different
position than most other airlines at the time. There were
no domestic routes to serve it was forced to immediately
start competing with international airlines for routes,
getting access to airports, securing flight slots and
landing rights, and attracting a new customer base.
Unlike most state-owned entities, Singapore Airlines was
subject to heavy competition from the onset and this
tough start created a driving spirit to compete and also a
dedication to branding, especially in the boardroom.
VISION:Singapore Airlines has a responsibility not only to be an
excellent company, but also to be an excellent citizen of
the world by enhancing the lives of the people we touch.
With that aim in mind, we have made many commitments
to the arts and education, to our communities, and the
health and welfare of our country's citizens, and those in
countries we fly to. With this goal in mind, we've also
made a strong commitment to preserving the
environment - and our world for future generations.

MISSION:- Singapore Airlines mission statement is we

are a global company dedicated to providing air
transportation services of the highest quality and
to earning good returns to shareholder.
CORE VALUES:THEIR SIX CORE VALUES:

Pursuit of Happiness
Safety
Customer First
Concern for Staff
Integrity

Team Work

GOALS:Singapore Airlines has a responsibility not only to be an

excellent company, but also to be an excellent citizen of
the world by enhancing the lives of the people we touch.
With that aim in mind we have many commitments to the
arts and education to our communities and the health
and welfare of our countrys citizen .With this goal in
mind; we have also made a strong commitment to
preserving the environment and our world for future
generations.

AWARDS AND ACHIEVEMENTS

Since Singapore Airlines first took flight, our
achievements have been recognized around the world.
We're proud of how far we've come, and humbled by the
tremendous support we've received. Singapore airlines
have won fourteen times The Asias best Airline award. It
is ranked 27 in Fortune Magazine.

STRUCTURE OF SINGAPORE AIRLINES

Singapore Airlines has diversified into related industries and sectors,
including ground handling, aircraft leasing, aviation engineering, air
catering, and tour operations. It has also restructured itself by hiving off
operational units as fully-owned subsidiaries to maintain its core
business as a passenger airline. The Singapore Airlines Group comprised
25 subsidiary companies, 32 associated companies, and two joint
venture companies in the financial year ending 31 March 2007. SIA sold
all its equity share of 35.5% in a joint venture, Singapore Aircraft
Leasing Enterprise, to the Bank of China for US$980m on 15 December
2006. There have recently been suggestions to divest SIA Engineering
Company and Singapore Airport Terminal Services, two of SIA's largest
subsidiaries. Minister Mentor Lee Kuan Yew, for one, voiced his opinion
in December 2005 that Singapore Airlines should divest these two
companies to focus on its core business of air transportation. Although
Singapore Airlines has evaluated the divestment opportunity, no
tentative plan has been announced to date. Major companies in
Singapore Airlines Group include:

Company
International Engine
Component Overhaul
Private Limited.
SIA Engineering
Company Limited.
SilkAir (Singapore)
Private Limited.
Singapore Aero Engine
Services Private Limited.

Type

Joint venture

Singapore Flying College

Private Limited.
Taj SATS Air Catering.

Aircraft
overhaul

Singapore

41%

Subsidiary

Engineering

Singapore

81.9%

Subsidiary

Airline

Singapore

100%

Joint venture

Engine overhaul

Singapore

41%

Cargo airline

Singapore

100%

Singapore

81.9%

Singapore Airlines Cargo Subsidiary

Private Limited.
Singapore Airport
Terminal Services
Limited.

Principal
activities

Group's
Incorporated
Equity
in
Shareholding

Subsidiary

Holding
company

Subsidiary

Flight school

Singapore

100%

Joint Venture

Catering

India

50%

ALLAINCE OF SINGAPORE AIRLINES

Singapore airlines is a member of Star Alliance. In
order to become members, all airlines must comply with
the highest industry standards of customer service,
security and technical infrastructure.

FLEETs
Singapore Airlines operates a wide-body aircraft fleet
from five aircraft families: Airbus A330, Airbus A340,
Airbus A380, Boeing 747 and Boeing 777. In keeping with
its policy of maintaining a young fleet, which stands at an
average of 6 years 7 months as at 24 January 2010, it
renews its fleet frequently. The Boeing customer code for
Singapore Airline is 7x7-x12.
Years ago, the airline named its fleet according to aircraft
type. The Boeing 747-400s were called "Megatop", the
Boeing 777s were called "Jubilee" and the Airbus A340500s were named "Leadership". Names for airliners
previously flown by the airline include: "Superbus" for the
8 Airbus A300s, "Celestar" for the 17 Airbus A340-300s,
"Super B" for the 23 Boeing 747-200s, "Big Top" for the
14 Boeing 747-300s. Several of these names were pulled
officially from the mid-2000s under then CEO Chew
Choon Seng. No official name has since been accorded to
the newer A380s which joined the fleet in 2007.
Singapore Airlines has never painted an aircraft without
its tail livery. Even special liveries such as the Tropical
Mega top and the Star Alliance livery still retain the
signature stylized bird on their vertical stabilizers. The
total number of aircrafts of Singapore airlines is as
follows:

AIRCRAFTs
Airbus A330-300
Airbus A340-500
Airbus A380-800
Boeing 747-400
Boeing 777-200ER
Boeing 777-300
Boeing 777-300ER

TOTAL
19
5
11
7
36
12
19

More over Singapore airlines have ordered 20

Airbus A350 and 20 Boeing 787 .

SERVICES OF SINGAPORE AIRLINES

Singapore Airlines have received numerous awards for

the standard of service it provides, the most recent award
being World's Best Cabin Staf at the 2010 World Airlines
Awards. It claims to be "The World's Most Awarded
Airline". In the 29th annual Zagat survey by US pollsters
in November 2007, SIA was placed first in both premium
and economy classes while additionally.

In-flight services
A) Singapore Airlines Suites:-

Singapore Airlines Suites is a class available only on the

Airbus A380. The A380 flies to Hong Kong, London,
Melbourne, Paris, Sydney, Tokyo and Zurich. The product
is designed by French luxury yacht interior designer JeanJacques Coste and consists of separate compartments
with walls and doors 1.5 m high. The leather seat,
upholstered by Poltrona Frau of Italy, is 35 in (88.9 cm)
wide (with armrests up and 23 in (58.42 cm) wide when
armrests are down) and a 23 in (58.42 cm) LCD TV screen
is mounted on the front wall. The 78 in (198.12 cm) bed is
separate from the seat and folds out from the back wall,
with several other components of the suite lowering to
accommodate the mattress. Windows are built into the
doors and blinds offer privacy. Suites located in the center
can form a double bed after the privacy blinds between
them are retracted into the ceiling.

B)Cuisine:A meal in Economy class, on a flight from Los Angeles to

Tokyo. Singapore Airlines offers World Gourmet Cuisine in
all three classes. Regional dishes are often served on
their respective flights, such as the Kyo-Kaiseki, Shi Quan
Shi Mei, and Shahi Thali meals available for first class
passengers on flights to Japan, China and India,
respectively.SIA has also introduced a Popular Local Fare
culinary programme offering local favourites to
passengers in all classes flying from selected major
destinations. Business and first class passengers may
also choose to use the "Book the Cook" service on some
flights, where specific dishes may be selected in advance
from a more extensive

c) flight entertainment system and communication:Singapore Airlines' in-flight entertainment system,

KrisWorld, was introduced in 1997. B747-400 and Boeing
777-200ER use the Wiseman 3000 system which offers
on-demand movies, audio and Nintendo games in all
classes. Passengers flying Singapore Airlines Suites, First
Class and Business Class receive active noise-cancelling
headphones. In March 2005, SIA introduced the
Connexion by Boeing in-flight Internet service, and the
system was extended to offer live TV in June. The service
ended in December 2006 when Connexion was ceased by
Boeing. From October 2005, SIA has offered free language
lessons in 22 languages and, starting December 2005,
live text news feeds. SIA announced that Panasonic
Avionics Corporation has been selected to create the new
Kris World, using their new eX2 system. [105][106] The new
Kris World is available on A380, A330-300, A340-500
(equipped with Business Class only) and Boeing 777300ER.
Widescreen LCD TV with 1280 x 768 resolution.

 A range of movies,
interactive. programs .

TV,

music,

games,

and

Built-in office software, based on the StarOffice

Productivity Suite for use with the USB port.
In-seat AC power port.

Ground services:Passengers may check-in between two to 48 hours prior

to flight departure. This may be done over the counter or
at the lounge within the airport (for first and business
class passengers). Self-service kiosks are also available at
Singapore Changi Airport. First class passengers also get
a dedicated lane at Changi Airport where staff will
personally welcome and escort them. Alternatively, they
may check-in through the Internet or by short message
service. Online printing of boarding passes is available
through Internet check-in. Passengers on short trips may
also check-in on their return flight upon departure from
the city of origin.

Marketing strategy
1. Differentiation:The different thing about the Singapore airlines is the
Singapore girl which is there to serve you. It is one of
the important factor for the success of Singapore
Airlines. The personalization of the Singapore Airlines
brand is the mixed male and female cabin crew, where
especially the flight stewardesses commonly referred to
as Singapore Girls have become very well-known. SIA
engaged French haute-couture designer Pierre Balmain at
the inauguration of the
airline in 1972. He designed a special version of the
Malay sarong kebaya as the uniform which later became
one of the most recognized signatures of the airline. A
very designated and visual part of the entire brand
experience. The Singapore Girl strategy turned out to be
a very powerful idea and has
become a successful brand icon with an almost mythical
status and aura around her.
The Singapore Girl encapsulates Asian values and
hospitality, and could be described as caring, warm,
gentle, elegant and serene. It is a brilliant personification
of SIA's commitment to service and quality excellence.
The icon has become so strong that Madame Tussaud's
Museum
in London started to display the Singapore Girl in 1994 as
the first commercial figure ever. Singapore Airlines also
runs one of the most comprehensive and rigorous training
programs for cabin and flight crew in the industry to
make sure the SIA brand experience is fully and

consistently delivered. The social status of the Singapore

Girl has also reached near-celebrity in Asia. This has
allowed Singapore Airlines to be highly selective
in the recruiting process for talent which has added
further to the strength of the brand icon and the myth
around it.
The Singapore Girl

a) Place:Singapore airlines is available for all the five

continent as well as it goes to 35 countries. Thus
Singapore airlines has a wide coverage.
b) Price:Its prices for economy class are affordable. But
have expensive business class and first class.

c) Promotion:The Singapore girl is itself a promotion for

Singapore
airlines. They
are
the brand
ambassadors of their company. Moreover it has
done various advertisement in TV, newspaper ,
internet etc.
d) Product:The Singapore airlines have most advanced and
new air crafts in there kitty. It does not keep any
aircraft which is older than 2years. It changes its
aircraft in every 2 years.
2. Segmentation:Market segmentation is the grouping of customers and
characterising them in a relevant manner to ensure that
the product or service is aimed at the right consumer (or
customer). The objective is to help determine marketing
strategies and realistic marketing objectives by
understanding customer trends and buyer behaviours.
Once the market has been segmented, SIA can pursue all
or a number of segments with a different offer for each
through differentiated/niche marketing that creates and
maintains value for the targeted segments Examples
where SIA uses these types of segmentation are provided
for each of the general bases for segmentation
summarised below.
Segmentation combined with the GE Matrix can also
provide some useful insights for targeting segments and
finding gaps or attractive segments that could be
matched against SIAs business strengths. After the
organisation has identified and selected its target market,

the next stage for SIA is to decide how it wants to position

itself within that chosen segment.
Bases for segmentation with Singapore Airlines:
Geographic SIAs customers are located globally
with varying wants and needs or behaviours and the
organisation attempts to exploit this by providing
airline services to major cities/ routes evidenced by
SIA flying to 65 destinations in 35 countries on five
continents. SIAs strong presence in the Southeast
Asian region, with its subsidiary SilkAir, connects
Singapore to many international destinations in the
region. The airline has also established and captured
major markets in its Kangaroo Route, flying
international traffic into and out of Australia and
since 2005, frequent flights between Bangkok and
Tokyo. SIA can segment geographically in an attempt
to gain extended market share on transpacific routes
from Australia to the United States, as evidenced by
its proposed hub in North America through
Vancouver.
Demographics segmenting on the basis of
customer factual characteristics such as age, gender,
income etc. SIA could build on from this by looking at
them in terms of the other major segmentation
variables using multiple approaches to achieve a
more complete consumer profile.
Psychographic attempts to capture what is
driving the customers behaviour, such as values,
personalities, attitudes and lifestyle aspirations of
each segment. For example, SIA provides variations
of cabin classes (First, Business and Executive

Economy) to meet the product needs and wants of

people. SIA employs tiered membership to provide
status preferences to consumers. In addition, the
Low-Cost Airlines have attracted a market that have a
simple need to reach their destination without the
extras. SIA have positioned to be part of this target
market with their stake in the carrier, Tiger Airways.
Behavioural is segmenting the market based on
observable issues on consumer behaviour when
consuming the products. Characteristics include
frequency of consumption, buyer readiness and
commitment. The corporate market tends to be a
frequent flyer that could gain benefits from SIAs
Frequent Flyer program (KrisFlyer and PPS Club), in
return for consumer loyalty to the airline.
Buyer Behaviour:With the level of competitiveness in the airline industry,
an understanding of buyer behaviour makes marketing
strategy development and value creation easier.
Consumer behaviour is however complex and dynamic
because different products are bought differently and as a
result of different thinking. Factors that influence it
include a mix of social, cultural, personal, lifestyle,
psychological, environmental, education, occupation,
motivation and beliefs and attitudes to name a few. SIAs
understanding of this could enable them to develop more
successful marketing mix strategies.
Henry Asael in Kotler summarised the four different buyer
behaviours that require different responses from
marketers:

1. Complex buyer behaviour requires marketer to

provide more information and reassurance to a
customer. This is probably more prevalent in B2B
transactions with SIA.
2. Dissonance-reducing buyer behaviour requires
marketer not to provide any reason not to buy the
product and maintain consumer satisfaction. SIA
maintains this through their consistent delivery of
quality service in all cabin classes leaving consumers
with high satisfaction levels. The frequent flyer
program and lounge services further add value to
their level of satisfaction.
3. Variety-seeking buyer behaviour requires
marketers to provide a lot of options within their
range so it reduces the likelihood of the customer
switching to another provider. For example, SIA
provides a variety of options in cabin classes,
catering, in-flight entertainment, flight destinations
and even for budget-conscious customers, an option
with their Low-Cost Airline, Tiger Airways. These
days, access to service providers via the internet
enables buying decisions that involve low risk to be
compared more directly with competitors.
4. Habitual buying behaviour requires the
marketer to encourage as many people as possible
to trial their products so as to be included in their
habitual choice sets. SIA along with SilkAir has
established a strong presence in the Asian market,
managing regional flights to secondary cities with
smaller capacity requirements. The corporate sector,
as part of their business needs, is perhaps the most
consistent and habitual with flight bookings.

Upon a customer experiencing services from SIA, it is

equally important to understand how the customer is
satisfied by the service and/or product offered. This
provides invaluable insight on how the service and/or
product provided value for the customer as well as how
they chose it. Market research can be of assistance here.
3) Market Positioning:After segmenting a market and then targeting a
consumer (based on an understanding of their buying
behaviour), SIA can now position a product/service within
that market. Market positioning is about how SIA wants
consumers to perceive their products and services in
relation to their competitors. An understanding of market
positioning enables SIA to create positioning strategies
that result in an offer being seen by consumers as
attractive, filling a gap in the market, and providing the
organisation with some competitive advantage.
SIAs options are to:
1. Pursue the segment with an offer based on a current
product, or
2. Develop a new product offer that meets the needs of
the segment.
SIAs positioning strategy uses Singapore Girl as a central
ingredient in marketing its image. Singapore Girl broke
that
branding
image
of
traditional
marketing
communications focusing on cabin design, food, comfort
and pricing. Personified through the girls, customers got a
sensory/emotional experience of air travel with SIAs
commitment to service and quality excellence. The more

senses the brand appeals to, the stronger the message

will be perceived.
At the other spectrum of the market, Tiger Airways
positioning is also very clear it is a pure low-cost carrier.
It pursued a segment with a low-cost offer and positioned
itself close to existing competitors like Jet Star, and Virgin
Blue, so consumers can make a direct comparison when
they purchase. It is operating successfully within
Australia, doing well in market penetration and turnover
against its competitors.

SWOT ANALYSIS OF SINGAPORE AIRLINES

1). Strength:SIA has been setting a good record on operational
performance and profitability. Even in economic downturn
in 1990, SIA was able to outperform in posting profits.
High quality service :SIA

has always been frontier in providing high quality

services to its customers which attracted a large number
of flyers to SIA. It
Introduced electronic ticketing through websites.
Online ticketing was rolled out at all destinations in its
network.
Introduced automated check-in system on certain flights.
Silver Kris Lounge for first and business class people
offering peace and tranquility in the hustle and bustle of
the airport.
Provided top of the line business equipments such as
computers, fax services and a stock ticker.
Singapore Girl Image :-

The Singapore Girl Image represented caring, comfortable

and hospitable service. This image was carefully nurtured
as it represented the brand of SIA. SIA paid great
attention in the selection process and training of the
candidates applying for the jobs. Apart from emphasized
aspects of passenger handling, social etiquettes and
grooming, these candidates also spent extensive periods
of the training program in homes for aged. This gained a
better appreciation for that segment. Taking advantage of
labor law, SIA had about 60% of the cabin crew as
females.

Employee Training :-

SIA had pilots from over 50 countries. The company

operated its own flying college with eight flight
simulators. All flight personnel were required to go
through biennial proficiency checks. The complement of
cabin crew was chosen through a very rigorous process.
SIA spent 14 times as much as other airlines on per
employee training program.
Strategy of differentiation:-

SIA has always been keen in developing innovative

options to attract customers. The choice of meals in
economic class, innovative entertainment programs in
the cabins then became the norm of the major air
carriers. SIA has always provided the best of its service to
its customers in the best possible lowest price.
2) weakness:Sour Deals :-

SIA was somehow not able to form successful

partnerships. The deals which SIA expected to be fruitful

turned out sour. As New Zealand Government put money

into the company, the SIAs share in Air New Zealand
dropped dramatically and SIA lost about $157 million.
Also the 49% ownership deal with Virgin Atlantic which
cost SIA $1.6 billion was 40% of its value.
Virgin Blue, before starting its service in Australia offered
the opportunity to participate in venture but SIA turned
down that opportunity relying on Air New Zealand deal
which went in loss. Also the Government of Singapore
declared that although SIA is a national carrier, it wont
receive any subsidies or protection from the government.
It would have to develop based on its own resources.
International flights :-

Singapore Airlines doesnt offer domestic flights. 100% of

total transported passenger fall under international
segment. As of 2009, SIA carried about 19 million
passenger all of which were international flyers.
Unbalanced Model:-

In addition to airline operations, SIA is also handling

airport terminal services and engineering services.
Although company operates in different segments, the
main revenue comes from airline operations.

3) Opportunities:Enter into Low cost-operating airline:-

SIA can definitely think of entering the low cost-operating

airline service. If this hampers the brand image of SIA, it
can start with a different name and/or brand. The profit of
the low cost-operating airlines is basically based on the
cost savings in in-flight services, higher fleet utilization,
high load factor, etc. SIA can earn a significant amount of
revenue from there.

Future prospects of air hubbing in Singapore:-

According to developed projections by Boeing air freight

traffic is expected to grow in Asia-Pacific region during
1993 and 2014 at a rate of 5.3% to 7.9% annually. Even
though Singapores geographical location does compare
less favorably with cities like Hong Kong, steps must be
taken by Singapore Government and different segments
of the air freight industry to take advantage of new
developments.

4) Threats:Low cost operating airlines:-

Low cost operating airlines definitely pose a great threat

to SIA. The unbelievably low air fairs for short distances.
Even though these carriers do not offer quality in-flight
services, the business model works great and can attract
most of the consumers towards it.
Rising Fuel Prices:-

Due to global rise in oil prices, the aviation fuel prices

have gone up substantially. The Fuel operating cost for
Singapore International Airlines for 4 years in $/ATK is
shown below table.
Operating

2000

2008

2009

2010

Cost
Fuel

4.6

6.7

5.5

6.6

($/ATK)

These rising fuel prices may have immediate impact on

the companys margins making the operating expenses
high and having lowered sales.
Foreign currency rates:-

Since SIAs 100% customer base is international, SIAs

revenue is dominated by foreign currencies exposing its
margin to the threat of volatility due to currency rate
changes. Currency rate fluctuations of Australian Dollar,
Euros, and Japanese yen have a substantial impact on the
revenue streams of SIA.

PEST ANALYSIS OF SINGAPORE AIRLINES

The PEST analysis is one of them that are merely a
framework that categorizes environmental influences as
political, economic, social and technological forces.
Sometimes two additional factors, environmental and
legal, will be added to make a PEST analysis, but these
themes can easily be subsumed in the others.
Political factor:

This refers to government policy such as the degree of

intervention in the economy. What goods and services
does a government want to provide. To what extent does
it believe in finance firms such as Singapore Airlines has
withdrawn its bid for a stake in Air India, dealing a heavy
blow
to
the
Indian
government's
privatization
programmed. This is a political barrier for Singapore
airline.

Economic factors:

These include interest rates, taxation changes, economic

growth, inflation and exchange rates. The Singapore
Airlines offer to buy a 24 percent stake in China Eastern
Airlines for 7.2 billion Hong Kong dollars (US$923.8
million) appeared in trouble Wednesday after a major
shareholder criticized the deal as unfair.

Social factors:

Changes in social trends can impact on the demand for a

firm's products and the availability and willingness of
individuals to work. In the year 2002 there was a fatal
crash of a Singapore Airlines flight SQ006 at Taipei's
Chiang Kai-Shek International Airport. Authorities blamed
pilot error for the accident. Singapore Airlines has
accepted full responsibility for the crash, saying it was
obviously a case of pilot error. The airline has offered
$400,000 in compensation to the relatives of each of the
dead and announced it will meet the medical expenses of
the injured and discuss compensation with them. But
facts have already begun to emerge that point to a
number of other causes, some of which are directly linked
to cost-saving measures by airlines and airport
authorities. The death toll has risen to 82 people with the

death of a survivor in hospital. Another 81 passengers

were injured. This accident makes societal effect on
Singapore airline.

Technological factors:

New technologies create new products and new

processes. Organization must have-to concern about the
new upcoming technology. Singapore Airlines is the first
and only airline to install a productivity suite for the
benefit of its passengers who can now continue to work
after boarding the plane without having to power up their
laptops. In addition to providing the world's widest first
and Business Class seats and a technologically advanced
seat in Economy Class, which makes the competitive
advantage for Singapore airline.

Perceptual Mapping
It is a tool through which the companies know
how their product or services are perceived by the
consumer. The perceptual map of Singapore airlines
is as follows:

Conclusion
Thus Singapore airlines is a company having strong
market position. It also
has 65 destination
in 35
countries. Because of all
these
efforts
Singapore
airlines have become the Asias no.1 airline. Moreover
they have 110+ planes in the kitty, making them to
reach the major corners of the world.
Singapore airlines does not have the domestic flyers.
Thus they should concentrate on the domestic part
also. And also it should increase its range in order to
reach other parts of the world.

BIBLIOGRAPHY

1. www.singaporeairlines.com
2. www.scribd.com
3. www.google.com
4. www.starallaince.com