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Marketing Management Avid airways

1. Executive Summary
Aero Asia private airline which closed its operations in past due to unfavorable
environment is re-launching itself under the name Avid airways. The decision of re-
launching Aero Asia has been taken to obtain advantage of a specific gap in the short-
haul domestic travel market initially and latter internationally. The gap exists in low cost
service out of any town, Pakistan. The gap in the availability of low cost service in and
out of the any town hub coupled with the demand for passenger travel on selected
routes from any town indicates that any other airline except for the existing airline can
capture a significant portion of current air travel business at that hub.

The management of Avid airways is experienced in airline start-ups. Previously
management grew Private airline Aero Asia from a single BAC 1-11 aircraft to a fleet of
Boeing 707 series aircraft.

Institute of Business Management

Marketing Management Avid airways

1.1 Report Objective

The main reason of this report is to create an impact of a Pakistani airline all over the
world, which will fulfill the entire customer requirements. We have decided to re-launch
Aero Asia airline with new name, slogan & objectives.

New name:




“Things go better with Avidd airways”

Institute of Business Management

Marketing Management Avid airways

1.2 Mission
Avid airways private airline has a mission to provide safe, efficient, nominal-cost
consumer air travel service. Our service will emphasize safety and quality service as its
highest priority. We will operate the newest and best routes and services available. We
will never skimp on maintenance in any fashion whatsoever. We will strive to operate
our flights on time. We will provide friendly and courteous "no frill" service.

1.3 Keys to Success
The keys to success are:

• Obtaining the required governmental approvals.
• Securing financing.
• Experienced management. (Already in place).
• Marketing; either dealing with channel problems and barriers to entry; or solving
problems with major advertising and promotion budgets. Targeted market share
must be achieved even amidst expected competition.
• Product quality. Always with safety and services foremost.
• Services delivered on time, costs controlled, marketing budgets managed. There
is a temptation to fix on growth at the expense of profits. Also, rapid growth will be
curtailed in order to keep maintenance standards both strict and measurable.
• Cost will be controlled by employing the lower class people for making napkins,
glasses and other stuff required in plane; by doing so we believe we will help poor
class of our economy and will cut our cost by being innovative.

1.4 Vision & Strategy

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wikipedia. a sister company of the Romanian Air force. systems and aircraft to facilitate a lifting of the suspension in early 2009 in accordance with the 2007 Draft National Avidation Policy issued by the Pakistan Civil Avidation Authority. Operations were started with wet-leased BAC 1-11 aircraft from the VIP fleet of Romania operated by Romania Airlines. employing senior ex-PIA management with a serious growth plan. Marketing Management Avid airways 1. the post Ceausescu governments decided to earn a little money by leasing this fleet to other commercial operators. The airline contracted two Romanian Airlines aircraft for wet-lease & lease- purchase of BAC 1-11 aircraft. following the example of PIA and in line with requirements of the local civil Avidation authority. A small training school was also founded. It operated domestic and international services. Since then the owners and executives have been sourcing expertise. . in its initial years. made serious commitments to training its locally-hired staff. the national airline of Romania. However. Aero Asia obtained four BAC 1-11 aircraft on lease purchase option from Tarom. Its main base is Jinnah International Airport.cite_note-FI-0. This fleet was primarily used by Romanian government dignitaries during Ceausescu’s times. The airline. Karachihttp://en. Pakistan. Since May 2007 the airline has suspended from flying due to issues related to the safety of operations and passenger convenience.5 Introduction to Aero Asia Airlines Aero Asia International was a private airline based in Karachi. Quick Facts • 850 domestic and international per month • Aero Asia is Pakistan largest private airline • Serves 11 regional destinations Aero Asia History The airline was established in 1993 and started operations on 4 May 1993 The airline made a promising start. for 4 Institute of Business Management .

However. the airline replaced its YAK-42Ds with Boeing 737-200Adv and Douglas DC-9s. In 1994 Aero Asia took the usual step for a private airline in Pakistan by recruitment of batch of trainees for aircraft maintenance. Aero Asia started its international operation on a route to Bishkek. Aero Asia operated a fleet of three to five Yakovlev Yak-42D on main trunk routes in Pakistan. On May 22. Later. Here the aircraft is seen wearing a Boeing/Aero Asia hybrid scheme) At the start of 2006. Marketing Management Avid airways training of cabin crew. who began flying as co-pilots with the Romanian Pilots. The management of the airline was pre-informed about the CAA decision and the ban would remain imposed until further orders by the Avidation regulators. linking to Dubai via road network. The airline also introduced a more modern livery instead of hAvidng the colors of a past operator of the aircraft on its fuselage. as demand rose through the years. 2006 the Civil Avidation Authority stopped all Aero Asia flights as it was owed millions of Rupees. These were mainly Karachi. 5 Institute of Business Management . a Boeing 707 aircraft was leased. Aero Asia started flying to the Gulf Emirate of Sharjah. For this purpose another aircraft from the VIP fleet of Romania. It also established a small maintenance facility in Sharjah Airport Free Zone by taking over a small aircraft hangar and offering services to third parties. Islamabad and Lahore. announcing that a fully-functional aircraft maintenance facility was planned. in Central Asia. Former Pakistan Air force pilots were recruited. Senior retired staffs from the PIA training center were employed and approval of the training school from the local civil Avidation authority was sought. The move to shift international operations to central Asian ex-USSR states was supposed to help the other businesses of Tabani Group in penetrating the countries. A large "Aero Asia" was added to the front fuselage in bold red color with the airline logo in between the words and on the tail (A Boeing 737-200 Adv operated by the airline. Aero Asia and Askari Bank MasterCard announced their strategic alliance to offer their card members special discounts.

The airline announced that it had decided to suspend operations temporarily with effect from 19 May 2007 until further notice. instead of improving. The brand has a presence in Pakistan. and United Kingdom. • Boeing 737-200 • McDonnell Douglas DC-9 • McDonnell Douglas MD-80 • Rombac-111 • Yak-42 6 Institute of Business Management . The problems had been highlighted to the management of Aero Asia time and again but the situation. Marketing Management Avid airways On June 12. Tabani Group. The airline is currently in the process of being rebranded and restructured. 2006 a United Kingdom-based company acquired Aero Asia from its original owners. deteriorated. In May 2007 the Civil Avidation Authority (CAA) of Pakistan suspended the operations of Aero Asia due to issues related to the safety of operations and passenger convenience. with headquarters in Karachi and Yorkshire.Kashmiri descent. The Group belongs to people of Pakistani. Former fleet Over the years Aero Asia operated these aircraft. United States. Fleet The company returned the aircraft being operated on 19 May 2007 under wet lease arrangements to the lessors and is now negotiating to acquire a fleet of five 737-300 aircraft under funding arrangements concordant with the 2007 Draft National Avidation Policy for Pakistan.

PIA remained the only operator for many years after its creation. Most of them have left the arena due to heavy taxes of CAA. India that caused the airline market to suffer. However. wrapped up their operations years ago leAvidng the market open to the remaining operators. Hajvery. the national flag carrier Pakistan International Airlines (PIA) and private Shaheen Air International and Aero Asia. As a result many private companies make induction in to industry. It was not early nineties there was a major growth in the Pakistani Avidation market with four new private airlines launching operations. which would not sustain the cost structure of their companies. Marketing Management Avid airways 2. but soon private airlines arrived at the scene to compete with the national flag carrier as conditions of the country stabilized In 1993 Civil Avidation Authority opened the Avidation sector for private investor in order to boost the healthy competition for better traveling services at low price fares. PIA which was controlled by the government. officially called Pakistan International Airlines. Industry Background History of the Pakistan Airline Industry The Pakistan Avidation industry was started up when Orient Airways merged with Pakistan International Airlines Corporation (PIAC) to become the national flag carrier of Pakistan. Bhoja. this was not to last as the UN placed economic sanctions on Pakistan and its neighbor. The airline did very well to compete with the well established flag carrier. It caused two of the four airlines to file 7 Institute of Business Management . Safe and Raji.

Marketing Management Avid airways for bankruptcy and liquidate their assets. The airline industry remained quite stable with PIA developing a strong hold on the international and domestic market for many years. It was not until the early 21st century that the industry started to pick up again that allowed the entry of new carriers in the market As of August 2007. the Avidation market was developing and allowing more services and facilities to be inaugurated as well as the development of a brand new airport to be built for the capital at Fateh Jang. 8 Institute of Business Management .

In Pakistan the transportation and communication sector holds more than 10% share in GDP (Gross Domestic Production). The up coming airlines like airblue have focused on passenger comfort.g. So prices of tickets do not matter for the upper class due to inelastic demand. the International Trade. In this scenario quality services can play vital role in attracting the customer base. The call centers have been established to guide their customers 24 hours a day.1 Market Analysis Transportation sector is most important sector of any economy and Avidation industry is major part of this sector. tourism and socio-economic condition of the country. Marketing Management Avid airways 2. The Avidation industry can affect the other sector of the economy. e. Different loyalty programs offered by airlines are part of their strategy to retain its customers. In coming year the basis of competition would be how airlines deliver services that offer value for money. Demand Analysis Air traveling is still a luxury keeping in view the socio economic conditions of the people of Pakistan. They have outsourced catering to offer exquisite cuisine to its customers. 9 Institute of Business Management .

For example. Innovative e-ticketing Technology Various Pakistani airlines have introduced its latest and innovative web based e-technology to members of the Travel Agents Association of Pakistan [TAAP] in Islamabad of late. which were not available before. PIA has started operation to India and Far East. Paperless Operation Operation of airlines such as Air blue are paperless. e. Marketing Management Avid airways 2. In all these threats and opportunities.2 Technological Developments There have been various technological developments which have taken place in the airline industry in Pakistan.ticketing allows people to purchase tickets online in a convenient manner. the new and existing airlines are going to need to operate and compete with each other not solely on price base but on the basis of services standards. any person who has access to Internet can get reservation from the company’s web-site with PNR numbers and get out the print. Non-Stop Flights PIA and Air blue are now offering non-stop (without any stopover) flights to various destinations in Europe. which have tried to bring the service at par with international airlines. example India has opened the air corridor for Pakistani airlines and the development of new ports like Gawadar & Sialkot the rising cost of fuel and heavy taxes of CAA. which is acceptable even in the airport restricted area. A question arises that how these new airlines will be 10 Institute of Business Management . and the foreign carriers who closed their Pakistan operations are back. Current Scenario Recently many developments have been taken place.

PIA is dominating the market by about 75% and rest is majorly enjoyed by Air Blue and Shaheen Airline. etc. Let’s see how they survive in cut throat competition. and Rewards as four tracks on which simultaneous emphasis is being laid. It was established on 7th December. Culture. The restructuring process has helped Pakistan Civil Avidation Authority to fully focus on:- ► Strengthening its safety and security oversight role as per International Civil Avidation Organization requirements and standards. in prevailing conditions a new entrance would either gain the share from currently operating airlines or create new customer base or combination of both. This organizational transformation process identified Structure. 1982 as an autonomous body. 11 Institute of Business Management . Recently. infrastructure and commercial development at the airports. a Civil Avidation Department in the Ministry of Defense used to manage the civil Avidation related activities. Prior to its creation. Marketing Management Avid airways able to tap the market. air traffic services. especially since three existing airlines were sharing domestic market among themselves. Civil Avidation Authority underwent Restructuring and Change Management process to meet the present and future challenges. Skills. 2.3 Legal Environment Pakistan Civil Avidation Authority is a Public sector autonomous body working under the Federal Government of Pakistan through the Ministry of Defense. airport management. All kinds of Civil Avidation related activities are performed by CAA including the regulatory.

outsourcing of non- core and wasteful activities. ► Enhanced Regulatory and air space management capabilities. Health. and Avidation Experts (Expected to be considered by the Cabinet for approval shortly). Quality work on new initiatives is in progress such as introduction of Enterprise Resource Planning (ERP). Private sector participation in the process is also being encouraged. Corporate Social Responsibility (CSR). benchmarking. Safety. Employees Performance Management system. Marketing Management Avid airways ► To facilitate growth of the infrastructure development (Airports and Airport Cities) on a fast-track basis. 12 Institute of Business Management . ► Investing in Human resource development through structured approach with particular focus on quality of people and enhancing their professional capability. Planning Commission. emphasis is being laid on commercialization of its assets and land with improved customer / passenger service standards. Ethics Management Program. Customer feedback mechanism at the airports. and Environment (HSSE). benchmarked with top performing international airports ► Development of a New Avidation Policy for the country in consultation with the Ministry of Defense. World Bank. Security. etc. Airlines. Moreover.

2 Local Competitors: There are currently only three operational airlines which are running their business in Pakistan. operating scheduled services to 23 domestic destinations and 36 international destinations in 25 13 Institute of Business Management . Marketing Management Avid airways 3.1 International Competition: Major competitors on different routes: • British Airways. more commonly known as PIA is the flag carrier airline of Pakistan It is the 31st largest airline in Asia. • American Airlines • Continental Airlines • Delta Airlines • Emirates • United Airlines • South African Airlines • Cathay Pacific Airlines • Japan Airlines 3. Competitor Analysis 3. Pakistan International Airlines Introduction to PIA Pakistan International Airlines Corporation.

Marketing Management Avid airways countries across Asia. It was in this unusual circumstance that Pakistan International was formed. in addition to its services closer to home. Pakistan International Cargo was started in 1974. the airline offers over 70 locations within Pakistan. Today it maintains a sizeable international route network. Europe and North America. The airline is owned by the Government of Pakistan (87%) and other shareholders (13%). It employed 18. from which it connects the metropolitan cities with the main bases. Faisalabad. textiles. PIA Cargo PIA also operates an extensive cargo delivery system within Pakistan. These include meat and vegetables. PIA operated a service called "Air Express" that delivered documents and parcels from one airport to another. paper products and laboratory equipment. the Middle East and the Far East. PIA Cargo transports a range of goods across Pakistan as well as to international destinations. Despite wars and economic trouble. In 2003 PIA launched "'PIA Speedex'". with a modern and expanding fleet. a courier service in Karachi. expanding within a year to 12 cities. Lahore and Islamabad/Rawalpindi.043 people as of May 2008. and Rawalpindi/Islamabad. Today. PIA passenger flights The airline's secondary bases include Peshawar. Quetta and Multan. the carrier survived to grow and prosper. The operations ended in the late 1990s when both aircraft were grounded. with shipments collected and delivered from customers' homes Marketing and Sponsorships done by PIA 14 Institute of Business Management . During the early 1970s. When Pakistan was founded in 1947 it comprised two territories on either side of the expanse of India. Its main bases are Karachi. Lahore.

McDonalds. ► PIA Horticulture. 15 Institute of Business Management . set up in 1996. ► PIA also promotes the Shandur Polo Gala that takes place every year in the Chitral and Gilgit regions of northern Pakistan during the summer period. provides flowers for display in PIA's offices and for a range of events. which enable the public to see static aircraft as well as astronomy shows. ► PIA also has its own Boy Scouts Association (PIA-BSA) working in partnership with Pakistan Boy Scouts Association. ► PIA is one of the official sponsors of the "Destination Pakistan 2007" festivals. The Citizens Foundation and Sindh Institute of Urology and Transplantation (SIUT). After the earthquake. ► PIA Planetariums located in Karachi and Lahore are owned by PIA. ► PIA teamed up with the fast-food franchise. winning several awards and accolades at flower exhibitions across the country. Al-Shifa Trust. ► PIA also supports non-profit organizations within Pakistan such as. to offer passengers discounts on meals and upgrades. Marketing Management Avid airways ► Pakistan International Airlines (PIA) supports a first-class cricket team that plays in the ABN AMRO Patron's Trophy in Pakistan. Zindagi Trust. ► PIA is also sponsoring the Pakistani team for the A1 Grand Prix. PIA-BSA was working in partnership with other charity organizations to provide relief help.

Its main base is Jinnah International Airport. Muscat and Manchester. 16 Institute of Business Management . It is Pakistan's second largest airline with over 30% share of the domestic market. e-Cargo will broaden the base of cargo and permit certified agents to book freight directly online opening the inventory through the web. Pakistan. Airblue operates scheduled flights operating 30 daily services linking seven domestic destinations and international services to Dubai. Karachi. Airblue makes a fuel stop at Trabzon in Turkey when flying to and from Manchester. The airline also became a member of Sabre system that is used by over a hundred airlines to help it with ticket automation service Cargo Service Airblue have launched e-Cargo service to cater to air freight markets of Pakistan. UAE and UK. Marketing Management Avid airways Air blue Introduction to Air blue Airblue is a private airline based in Karachi. Abu Dhabi. wireless check-in and self check-in kiosk facilities. Services Offered Airblue was the first airline in Pakistan to introduce e-ticketing. It carried 1.4 million passengers on domestic flights in the 2006-07 fiscal year. Sharjah. According to a press release. Karachi. Firsts for Air blue ► First airline in Pakistan and only the third carrier in the region behind Emirates and Royal Jordanian to introduce the state-of-the-art self-service check-in facilities at Jinnah International Airport.

Since then Shaheen Air has been in a perpetual pursuit of excellence in operations and services. Marketing Management Avid airways ► First private airline in Pakistan to initiate long-haul services on (Islamabad-Manchester) sector. ► First airline in Pakistan to start e-ticketing. of Canada. Since June 2004. After the re-launch. Karachi. ► First private airline within Pakistan to place an order for new aircraft. Shaheen Air was founded in December 1993 and in just 10 months on account of its professional service. utmost priority was accorded to achieve the sole objective of making it a leading customer focused regional and international airline. Services offered Shaheen Air has re-emerged with a new vision and its visibility is increasing in domestic and international skies. exceptional performance. with a hub at Benazir Bhutto International Airport (ISB). ► First airline in Pakistan to start self check in kiosks (Karachi) Shaheen Airways Introduction to Shaheen Shaheen Air International is a Pakistani private airline based in Karachi. Shaheen Air has acquired four modern Boeing 737s aircraft. Shaheen Air is increasing its domestic 17 Institute of Business Management . it was accorded the status of Second National Carrier of Pakistan. Its main base is Jinnah International Airport (KHI). on October 25. To facilitate the air travel at a reasonable price. Islamabad. under the new management of TAWA International Inc. It operates scheduled services in the main cities of Pakistan and to the Persian Gulf countries. customer support and expertise in Avidation. 1994.

very soon. Destinations flown Shaheen Air International operates the following services (at June 2009): ► Kuwait Kuwait International Airport ► Oman Muscat .Sharjah International Airport 18 Institute of Business Management . more domestic flights linking smaller cities with major cities across Pakistan.Jinnah International Airport Hub Lahore .Abu Dhabi International Airport Al Ain .Benazir Bhutto International Airport Karachi .Doha International Airport ► United Arab Emirates Abu Dhabi .Sialkot International Airport ► Qatar Doha .Peshawar International Airport Sialkot .Al Ain International Airport Dubai .Muscat International Airport ► Pakistan Islamabad . Marketing Management Avid airways and international flight frequencies.Dubai International Airport Sharjah .Allama Iqbal International Airport Peshawar . Plans are afoot to introduce.

is no longer a sufficient concept on which to build an airline. 4. at this time customers are looking forward for an airline. Marketing Management Avid airways 4. There are two specialty segments that have characteristically been exploited by the existing airlines. The more critical decision has become one of deciding on service mix and price in conjunction with LENGTH of route. One is the "price" niche and the other is the "route" niche. in and of it. whose rates are reasonable. the true market segment opportunities today have become a COMBINATION of service mix. price.1 Market Segmentation The airline industry is dominated by the major carriers. and route selection. Like so many other industries it has quickly evolved into an industry that has room only for major players and smaller "specialty" or "niche" participants. Market Analysis Summary In Pakistan local routes are served by PIA. It is an industry characterized by private and public airlines. is safe to travel with and offers quality service especially to business people and students. With the increasing trend of students moving from different cities or going abroad for studies targeting student segment will be beneficial for this airline as this segment is underserved. Avid airways have 19 Institute of Business Management . One focuses on charging less. Thus. the other on providing either the only service between two given points or else superior or more convenient or less costly service between two heAvidly traveled destinations. Air blue and Shaheen. not a promise. Re-launching Aero Asia under this market situation will be beneficial as our main focus would be on safety and quality serves. In today's marketplace the "price" positioning. PIA is considered as an airline for upper middle class with comparatively higher rates then Air blue and Shaheen whose main focus is on lower rates. Low fares have become an expectation. Our survey has shown that currently people are not satisfied with the food and staff of the airlines. With the recent plane crash people are worried about their security as well. Since de-regulation the flying public has been inundated with low fares.

Marketing Management Avid airways decided that to be different from other airlines it will focus more on services and safety. 4. Segment Segment Analysis Geographic: All Major Countries & Cities Of Pakistan Demographic: All age group & for both gender.75. • Save & secure flights in less prices. focusing mainly on business people and students Social Class: All Classes Psychographic: • Availability of Flights • More Attractive routes & services. Beside that we will also target business men and other sectors as other airlines do.2 Target Market Our primary target market will be students. With the increasing trend of studying abroad and different cities Avid airways will primarily cater this market with low fares by giving student discounts and will support the young generation of this nation through different activities. our segmentation will be. 000 / Month ► Economy Plus o Business travelers from cost-conscious companies o Some leisure travelers ► Economy 20 Institute of Business Management . which will be covered latter in the report. ► Upper Class o Business travelers 35-45 o Earning > Rs.

5. If the airline makes it desirable for the consumer to want to fly it then it is just as easy to order tickets directly from the airline as it is from any other source.3 Distributing a Service Sales of airline tickets have historically been either direct from the airline itself or through various travel agents. SWOT ANALYSIS Strengths • Our major strength would be our target market i. Avid airways will have its own reservations agents available via a number (the service will be 24 hours from an available pool of 20 agents in total) as we can’ afford more. Marketing Management Avid airways o Primarily Leisure Travelers and students Evenly spread among socioeconomic groups 4. We will focus more on E-ticketing as it convenient for both the airline as well as the customer’s. The critical element for both strategies to be successful for an airline is simply to create the demand for travel on one's airline. In addition. Modern computer technology and communications capability are changing the mix dramatically. 21 Institute of Business Management . The airlines found themselves held hostage. Available technology has now afforded the opportunity both to sell one's own tickets and to eliminate the physical ticket altogether. Perks and incentives amounted to coercion and bribery.e. This channel of distribution has been one of very high cost to the airlines. we will have an Internet site where schedules are available and customers can book their own reservations and buy tickets via credit card. Travel agent commissions at one time became the highest individual cost item to an airline. students which are under served. picking up tickets and giving commissions. Avid airways will encourage E-reservation rather then going to travel agents. Travel agents once accounted for 80% of ticket sales.

Avid airways will definitely try to capture this market and give them the best service possible. Some airlines did not have any real assets and were nicknamed as 'Brief Case Airlines'. Cheap food. • Pakistan Avidation has tremendous potential for cargo business. overbooking. dirty noisy eastern aircraft. • There is currently no such airline who focuses on students as their major target market. Pakistani passengers have seen many inexpensive airlines with their cheap service where they save some money. late departures and humiliating behAvidor by the airlines staff are the hallmark of these airlines. 22 Institute of Business Management . tapping in this market will help us in increasing our sales. it is very important that 'quality airlines' must come up. as it’s a re-launch by Aero Asia group we have to build our trust on the people that we will not quite this time but we are here with a revolution and better services. but lose a lot on every flight. Opportunity • With the increase of awareness among the passengers. Marketing Management Avid airways • Quality services • Low cost • On time flights Weakness • The most critical factor with Avid airlines is to overcome with the brand equity and recognition.

Marketing Management Avid airways Threats • Pakistan is a growing economy but the only problem is you never know what will happen in this country tomorrow. Airblue and Shaheen Air International as they have established themselves over the years. Government change results in difficulties as new governments also change policies and make new laws and regulations. • Avid airways will have to face a tough competition with the local airlines: Pakistan International Airlines. The political situation is very unstable and investors don’t want to take risks in such situations. 23 Institute of Business Management .

allowed. Marketing Mix 6. and o Kids shows o Own video games console (Up to 35 games) • Free amenity kit. and o Avid Airways lip balm PREMIUM ECONOMY • Separate priority checking line. • Early boarding. Marketing Management Avid airways 6. o Postcards o Eyeshades o Comedy o Earplugs o Socks. prior to the main coach class passengers. • Priority luggage handling • Massive sized video screens 24 Institute of Business Management .1 Product Core Product – air travel Augmented Product – ECONOMY • Individual seatback TV o Latest movies o Sports o Drama.

fine china. and distinctive personalized cutlery • The Freedom menu • Beauty therapists on board • Entertainment on board Service Offerings Economy • In-flight Entertainment • Mileage Benefits Economy plus • Check-in • Cabin • In-flight Entertainment • Mileage Benefits Upper Class 25 Institute of Business Management .with table service. Marketing Management Avid airways • Library of movies • Umpteen video and audio channels • In-seat power supply for laptop computers. • Members of Avid airways 'Flying Club' frequent flier program get 150% of flown miles when flying Premium Economy • Seats are bigger and wider • Recline further back • Leg room is of a generous 38“ • Extra storage area THE UPPER CLASS • Drive-Thru Check In • The Avid airways lounge • Printed menu with a range of hot and cold foods available .

Marketing Management Avid airways • To/From Airport • Check In • Airport Lounges • On-board experience • Mileage Benefits 6. and at a fair and predictable price. Our prices will be not too high neither too low. 6. Nor will we seek to be the highest priced. Essentially. and a rational fare basis. combined with better service and greater convenience than offered elsewhere will be our guiding principles. Avid airways game plan is simple enough. it is by no means the only one. Fairness. Competition on the basis of price alone has spelled disaster for more than one carrier and once down that slippery slope it is hard to turn back. And while price is clearly an important factor driving the marketplace. It will not be our aim to be the lowest-priced competitor in the market (though we may be on occasion).3 Price Pricing Strategy • Avid airways will follow middle range of price as compared to other airlines.2 Place Distribution and Sales Centers An Avid airway has many conveniently placed service centers throughout the country. we will work from only two sets of fares (existing for market segmentation purposes) for our service: 26 Institute of Business Management . clarity. either. offer customers good service to places they want (or need) to go to. Pricing can build or break the brand. • Markup strategy will be followed which is cost + additional % Pricing is one of the key aspects of marketing strategy.

• Students who visit their homes after every 3-4 months will get a frequent traveler card and will be charged low fares. electronically.again. most tickets will be paid for in advance of the departure date. and it does not have to be radically discounted from the normal fare . in both Value and Premium (aimed more at the personal or leisure traveler for whom price is more important than traveling mid- week). This also is where stand-bys can help fill any voids that may occur.since the normal fare will be just that. Given our stress on electronic reservations and ticketing. in both Value and Premium (aimed primarily at business travelers who are willing to pay a higher price to be able to go and come back during the week). helps them get on a nearly full flight. as part of its marketing strategy and offering a higher level of concern for the traveler - should avoid the common and much detested practice of overbooking. which means that Avid airways . publicized discounts for early reservations and purchasing tickets in advance. • Stay-over weekend fares. and not simply what the market will bear. and not some outrageously priced gouger). The only variations on those fares (not new fare bases) will be these: • Set. • Set. • And possibly a stand-by fare (call it the "Gambler Fare") for people who are willing to take what's available at the last minute (helps us fill seats. In addition. fares for the most part should be based on some rational system that is calculated on distance and actual costs. a normal fare. • Seasonal and certain peak-period adjustments to the basic fares or adjustments due to spikes in fuel prices and the like. publicized discounts for reserving and ticketing online. • Infant and child discounts based on the original fare (up to free in the case of infants). Marketing Management Avid airways • Weekday fares. One must wonder how much legitimate business is lost to the industry simply 27 Institute of Business Management .probably no more than 5 percent discount .

safety. • Provide “highest quality innovative service at excellent value for money for all classes of air travelers”. • Maintain focus on meeting unmet needs of customers. 6. Marketing Management Avid airways because many passengers cannot and will not pay the near-equivalent of a round- the-world fare only to go between two cities or neighboring countries.4 Packages: • Economy Packages • Premium Packages • Business Packages • Vacation Packages • Student packages 6. 28 Institute of Business Management . competitive prices • We have delivered this value through an integrated combination of factors: • load factors + high fixed costs >>increase trial rate. and widely perceived. innovation. as offering safety and high service quality at a competitive price • Positioning is aggressive – high service quality. maintain profitability • low cost structure • innovation • employee culture • service recovery • effective PR • alliances Other factors of our positioning include: • Lifestyle brand able to deliver value and quality with flair.5 Promotion Positioning Strategy • Avid airways is positioned.

1 Broad Objective: • Create awareness about the airline • Encourage people to try the airline • Raise awareness of new product developments and Raise awareness of new routes. Marketing Management Avid airways • “Turn flying into a unique experience”. Outdoors: A strategic site will be obtained for outdoors in main metro cities K/L/I near their major distribution office. Every month’s travel destination will be placed on this site. FM107 and FM91. Promotional Mix 7. Such a 29 Institute of Business Management . 7. radio is a much cheaper ad more effective media. FM100. Only business channels such as CNBC. Geo and Dawn News would be covered which goes with the image of the brand.2 Advertising Advertising Media Strategy Television: Advertising would not be placed on the television extensively due excessive clutter present on that media and high cost inefficiencies. Radio: Alternatively. 7. An extensive radio campaign will be undertaken for the initial months on channels like FM89.

Avid airways website would be promoted through print advertising.5 Interactive / Internet Marketing 30 Institute of Business Management . Advertising at airports will be done. Magazine/Trade Publications: Since they are the primary distribution source for airline seats. 7. Furthermore. 7. Our agents will personally visit the companies in which there is a lot of traveling and will demonstrate our services to capture the segment of business travelers. Advertising in trade publications would be of crucial importance 7. Newspapers: An extensive blitz marketing campaign would be undertaken at the time of the launch. a lot of sales and trade promotions activities would be required to push sales. Further promotional messages pertaining to the campaign would be present on the website.3 Direct Marketing DM media strategy Direct mail will also be used to encourage trial and to support above the line product or route messages.4 Sales/Trade Promotions Objectives In the initial stage. Marketing Management Avid airways strategy would increase the recognition factor through continuously rotating the advertising on a symbolic location. After that. every month’s travel destination ad would be placed in major newspaper like Dawn and Jang. The associated promotional elements will include online ads appearing on sites such as www. www. national fund raising day will be celebrated. this would be increasingly utilized.about. Student social service program will be run in which different type of social services will take place such as teaching poor chidren PR/Publicity Media Strategies and Messages Charity Avid airways onboard charity.. Marketing Management Avid airways Interactive / Internet Marketing Objectives As this medium is increasing gaining popularity. A similar kind of function would be undertaken through its office in Pakistan. Change for Children. Interactive / Internet Media Strategies and Messages Every month will be associated with a travel destination with specific events or festivals happening at that place in that particular month. Upper Class amenity kits are to be collected and unused items are to be given to charity. The objective for this media usage would be to create Top of Mind recall of Avid airways in the minds of our target audience and also to increase consumption of the Moreover.6 PR/Publicity Publicity Objectives CSR steps to improve the acceptability of the airline amongst the locals as a company who is undertaking societal marketing initiative for improvements. the target market is easier to filer and access through this medium. Sponsorship Pakistani students and youth is very talented but the sad back is there’s no one to support them so Avid airways will do different activities to push this talent forward. Activities such as 31 Institute of Business Management . 7.linkedin. Moreover.

000 Digital 3. road shows and press launches. run press conferences. 7.000. The Press Office This would serve as another promotional facilitation and support tool. • It will works with broadcasters and filmmakers to secure product placement for Avid airways.000 Radio 150. All PR activities can be initiated here and this will serve as the launch-pad for all Publicity campaigns. Marketing Management Avid airways • Voice of Pakistan • Best writers of Pakistan • Student designers of Pakistan etc Event Social events for travel agents exhibitions.300.000 Print 150. • It will draft and distribute press releases providing journalists with information about Avid airways • It will organize press briefings.000 Total 8. accompany the press on new route launches and set up photo opportunities for Pakistan.7 Budgeting Avid Airways Media Budget Medium Spend (in PKR) Television 5.000.000 32 Institute of Business Management .

1 Management Team A complete management team. 8. Flight Operations. and from a range of national origins. Once re-launching requirements are made step can be undertaken to finalize the core team quickly. Some of the individuals The bios of the management team are as follow. Marketing.2 Management Team Gaps Previously we have seen that Aero Asia closed its operations due to safety issues so the team hired should possess the widest possible range of the requisite skills. 8. We are not in the business of training key people. Financial 4. covering the elements of administration. and operate the airline. Customer Service. Maintenance. 3. Organizational Structure The company will be organized into five major operational areas: 1. launch. There will be no one in the management team who has not already performed his or her function for another airline. 2. Avidation. Marketing Management Avid airways This will be our over all budget for advertising and promoting Avid airways. 8. We intend to hit the ground running with a highly qualified and experienced management team. Management Summary The management of Avid airways will be highly experienced. and finance. 5. This team brings together a wide range of skills and backgrounds covering the key areas needed to form. 33 Institute of Business Management . is being assembled. The current project team believes investors in the airline will want to play a key role in helping formulate core management.

and human resources management. sales and marketing. energy. communications. Avidation operations. one that also shares the common vision of what this new airline truly can be and what it can become. ground operations. and administrative staff.3 Routes: 34 Institute of Business Management . Avidation maintenance. flight safety. 8. Avid airways believes in putting together the best possible airline management team in the business. Also good pilots. and vision to head up and serve in such areas as information management. co-pilots. Marketing Management Avid airways This airline will need people with skill. cabin crew members. experience. and ground staff.

Cost Estimation C. Monitoring/Control However the over all financial perspective is mentioned below Sales Estimation 1000000000 900000000 800000000 700000000 Economy 600000000 EconomyPlus 500000000 400000000 Upper Class 300000000 200000000 35 100000000 Institute of Business Management 1st Qtr 2ndQtr 3rd Qtr 4thQtr . Marketing Management Avid airways Financials: The financials of Avid Airways was sub divided into following parts A. Breakeven Analysis D. Sales Estimation B. Risk Analysis E. Contingency Plan F.

8 2.3 1.0 2.5 Interest 2.2 8.6 2.4 12.2 3.1 2.0 Passenger Food 3.5 2.5 2.0 1.7 Insurance 0.5 3.1 23.1 2.5 1.0 2.7 23.4 35.0 1.9 10.3 11.0 1.5 Maint.8 10.3 2.5 Advertising & promotion 2. Marketing Management Avid airways Cost Estimation Cost Item Share of Expenses Share of Expenses Share of Expenses Share of Expenses Q1 (%) Q2 (%) Q3 (%) Q4 (%) Labour 31.5 Others 19. Material 3.6 13.7 23.6 3.9 2.2 Communication 1.5 37.5 1.4 2.4 2.4 Fuel 17.5 38. 100 million for this project Breakeven Analysis: 36 Institute of Business Management .0 1.5 Landing Fees 1.5 Total 100 100 100 100  As per our calculation & estimation the initial cost will be Rs.1 Traffic Commissions 9.6 Aircraft Fleet 7.5 2.4 1.

000.000 Breakeven (Qty)  Fixed Cost/(Expected sales – Variable cost) = 50.000 tickets per month Risk Analysis: 37 Institute of Business Management . Marketing Management Avid airways Expected Sales  Rs 10.000 Fixed Cost  Rs 100.000 Variable cost  Rs 8.

We are committed and remain committed to growth and all our expansion is pressing ahead on schedule Monitoring/Control: We have created a separate department to monitor the same & also weekly meeting has been planned with upper management to discuss & control the same. We are completely prepared. and would increase its routes to 100 in five years from 68 now Whatever is happening around the world will not affect our growth plans. 38 Institute of Business Management . we already have a test plane that is flying about under the guise of a full service aircraft. Our fleet would grow to over 50 planes by 2013. from around 15 now. in 90 days Avid Airways can launch a competitive product. Marketing Management Avid airways Contingency Plan: If we find low cost is becoming a threat.