Ashraf Ali

Qatar Airways
 Ashraf Ali

Introduction

In the tourism industry, the important sector is the transportation of passengers.

Therefore, air travel is the most considered industry that directly affects the tourism industry.

Effective management of airlines translates to improved and vibrant tourism industry; thus,

traveling and tourism heavily relies on airline industries much more than any other sector.

Therefore, this report contains Qatar airways environmental and strategic position.

Qatar Airways is a flag carrier of Qatar and it is owned by the state. The airline is

headquartered in Doha Qatar. From its base in Doha, the company operates a spoke and hub

network that links over two hundred destinations worldwide. With unrivaled service delivery and

using a fleet of over two hundred new generation aircraft (Abeyratne, 2018, 21). Qatar Airways

is among the word’s growing airline. The airline is committed to unique service delivery as their

customer’s travel more frequently and farther. Since the onboard experience is an essential part

of the journey. The regions which are connected by the airline include South America, Far East,

North America, Middle East, Oceania, Africa, and Central Asia. Qatar airline employ over forty

thousand people out of which around twenty-five thousand are direct employees of the airline.

Additionally, the airline is a member of the one world alliance which operates from the airport in

Doha as its hub (Bisignani, 2014, 32). The alliance operates in over three hundred and fifty

destinations.

During the 2017-2018 period, the airline was the third largest member of the international

alliance group. Furthermore, the airline achieved a share price appreciation from sixteen percent

to twenty-five percent thereby strengthening its shareholders' position. Consequently, the airline

strives to transport over one hundred million passengers yearly (Belobaba et. al., 2014, 87). The

airlines’ determination to provide excellent services and superior flying experience has
 Ashraf Ali

tremendously helped it to position the airline as the fastest growing airline in the world (Bowen

and Cidell, 2015, 43). It prides itself as the holder of four admired awards; best business class

seats, the best airline in the Gulf region, best first class lounge and best business class during the

2018 Skytrax airline awards.

Porters’ basic strategy

The company’s competitive aspects can be looked into by using porters’ basic strategy.

However, for the airline to obtain a competitive advantage, it can only be achieved through a

competitive business strategy (Bowen and Cidell, 2015, 43). The Qatar airline obtains its

competitive advantage by offering lower prices than its competitors.

Swot Analysis

Strengths

The extraordinary capabilities of air travel which the airline' competitors are lacking,

places the company in a position to have an edge in the industry (Seaton & Bennett, 2017, 171).

Therefore, these capabilities are referred to as strengths. While Qatar’s oil and gas industry

greatly contributes to the airline' growth due to availability of jet fuel, its competitive advantage

tends to be its location. A single connecting flight from the gulf can be used by a vast majority of

the world’s population, thereby making the region a vintage transfer point for the long flight.

Apart from the airline' location, the airline was able to successfully establish itself as the

luxurious airline.
 Ashraf Ali

The clear and precise target segment

The airline' target segment has been the people who can afford to pay for their services

and travel in the luxury class. Additionally, the airline have a high-level of brand loyalty, since it

is the only official airline of Qatar.

Strong support from the management

Qatar government has offered strong leadership and backing for the airline. The vision

and strategies of their leaders were the most critical factors which resulted in the fast and steep

growth for the airline. Thus, it was the leaders’ attitude and determination towards the airline'

progress which made it beat a majority of older airlines in the region.

Recognition of trends

Qatar Airways have been quick to spot and respond to trends in the ever-changing market

demands by the customers (Bamber, et. al., 2013, 121). Consequently, the company compares

itself with the worlds’ leading carriers and have been consistent in following and benchmarking

the trends set-up by the worlds’ best airline in various aspects of service delivery.

In-flight experience

Qatar Airways have been targeting the luxury class customers for a long time with their

off-board and in-flight services. Right from checking into the airline, the attendants take every

step from baggage safety, reduced waiting time, in-flight entertainment, comfortable lounge,

customized meals, and online check-in. the company has taken care of these services to ensure

comfort for their customers at every juncture during their travel.

 Ashraf Ali

The factual name for luxury

The airline is well known for their luxurious travel. The first class and business class

passengers have access to world cuisines, relaxed seating, chandeliers, top grade wines, and fresh

flowers. Furthermore, the airline try to replicate an experience of a five-star hotel in their

business class travel hence, making their customers to be highly satisfied during their traveling

experience.

Cultural awareness

The airline exhibit a high level of cultural awareness (Cronrath, 2017, 89). Majority of

their flight attendants incorporates regional cuisines in their in-flight meals. Additionally, the

airline ensure that they integrate highly diverse in-flight attendants so that their customers are at

ease throughout the flight experience.

Weaknesses.

However, despite its global standing, the airline do not operate domestic routes, thus, its

revenues are directly dependent on the international markets exposing the company to risks

beyond the airline' control (Bilyk, 2014, 67). These are areas where the airline need to improve

on. Some of the weaknesses Qatar Airline experiences include;

Cost management

The company mainly focuses on the business class which is costly in terms of

maintaining the service quality as well as facilities. Moreover, there are fluctuations in the prices

of jet fuel as well as unionized wages (Siddiqi, 2014, 119). These issues make management of

costs very critical.

 Ashraf Ali

Competition from airline with low-cost facilities

There is an upsurge of low-cost airline in the region. However, the global recession has

resulted in the slashing of travel budgets. Thus, customers have preferred budget travels and

resulted in stiff competition for low-cost airline from luxury airline.

Regional political differences

The airline is, however, situated in the middle of major political strife zones of the globe

such as Palestine and Syria. Which prevents people from preferring the airline (Grant, 2016, 54).

In addition, global factors such as fluctuations in the US dollar, Brexit and financial recession are

creating continuous changes for the company.

Opportunities for Qatar airline

Emirates and Etihad airline, one of the major rivals of Qatari airline has launched new

routes outside its main base (Green, 2015, 71). Qatari airline have not exhaustively explored this

option. Despite the increasing political unrests in the region, the company should discover new

routes and markets to improve the company’s growth. However, another opportunity for the

airline is to introduce low-cost flights targeting the Y-generation with a desire to explore faraway

places with a limited budget. This diversification will help to enable the airline to benefit and

offset lower demand for best air travel (O'Connell, 2016, 91). These are areas where the airline

can utilize to enhance its services and operations to generate more revenue and sales
 Ashraf Ali

Increase in the frequencies of usage of the airline

With the increasing need for time, people have started to use air travel more than rail or

road. The increasing connectivity of the airline to different parts of the globe makes it a preferred

globetrotter for its customers (Lyashko, Prikhodko and Tyutyushkina, 2014, 87).

Threat analysis for Qatar airline

The industry analysts agree on a consensus that the remarkable growth of the airline may

come to an end as long as it does not make adjustments to its strategy. Airline from the Gulf have

not been viewed in a favorable light by American and European competitors citing that these

airline from the Middle East engage in unfair practices (Mayer, 2014, 94). These are

environmental factors which can adversely affect the airline' growth.

Competition

Qatar’s major competition comes from Etihad and Emirates airline.

Pestle Analysis

This is used to understand and report on the impacts of external factors that affect the

airline business activities. Thus, pestle analysis is important to help analyze immediate external

factors such as legal, political, technological, environmental, economic and social factors and

their eventual effects on the Qatari airways growth trajectory, market strategy, business case, and

model (Merkert and Hensher, 2017, 81). Since the airline is a flagship of the government of

Qatar, its daily activities are strictly monitored by the government. Thus, the airline is prone to

influence from legal and political factors. The government of Qatar initiated several projects and

new routes to prominent destinations internationally. This helped the airline to become the
 Ashraf Ali

youngest airline to have a presence in all the six continents of the world. However, with

increasing terrorist threats, some countries have terminated trade and communication with Qatar.

For example, the Trump administration placed travel embargo on most Muslim countries from

stepping into the United States (Green, 2015, 71). Fluctuating prices of jet fuel, the high cost of

maintenance, and regional crisis are all affecting the overall performance of the airline and

impeding growth.

The airline are renowned for and sets trends in all premium services offered in an airline

(Johnson, Scholes & Whittington, 2018, 88). For being a socially impactful brand, the airline has

maintained customer satisfaction at the core of its activities. Entire traveling experience using

advanced technology is at the customers’ fingertips with features such as notification of

departure, arrival, online check-in, payment and booking facilities. Consequently, the major

concern for the airline industry is the environmental protection with excessive consumption of

oil and fuel (Meyer, 2016, 112). Thus, Qatar airways need to implement modern fleets and

technologies to help reduce emission into the environment. In the interest of protecting the

environment, the Qatar government has embarked on policies and regulations for the airline to

strictly adhere to.

 Ashraf Ali

Political Economical

1. The blockade of the country by other 1. The economy slowed down due to the

Gulf nations due to politics negatively blockade by other Gulf nations

affected the Qatari airways 2. America’s blockade of passengers

from the Middle East affected the

airline

Social Technological factors

1. The airline have entered into 1. Modern and advanced technology

marketing deals with world-class onboard and traveling experience

organizations to strengthen and improves Qatar’s airways brand

improve customer reach 2. Adoption and implementation of

2. The already existing perception of technology to enhance efficiency.

clients’ premium and exclusive

services

Legal Environmental

1. The United States ban on laptops from 1. The airline' environmental governance

passengers from the Gulf region and sustainability framework

2. Operating most efficient and modern

fleet that reduces environmental

emissions’
 Ashraf Ali

Detailed pestle analysis.

Political

The other Gulf countries politically instigated blockade of Qatar negatively affected its

airways. Egypt, Saudi Arabia, United Arab Emirates, and Bahrain severed diplomatic and trade

ties with Qatar due to ideological and political differences. Eventually closing connectivity by

air, road, and sea from Qatar to these countries (Loftin, 2015, 155). Thus, the Qatar airline

cannot overfly the Saudi airspace and it was forced to reroute and use the Turkish and Iran

airspace which tremendously increased flight duration. The airline has been losing on a daily

basis over fifty flights to twenty destinations. This translates to twenty percent of its total

capacity (Rye, Blakey and Wilson, 2016, 69). Nonetheless, there are indications that the impasse

will be decided, but with continued standoff or similar occurrence of such dispute in the future,

the airline' profitability will be negatively impacted.

Economical

Qatar airline market share collapsed as it struggled to cope with diplomatic and trade

embargo imposed by the four Gulf States. It reported a loss of over seventy million dollars at the

end of April 2018. Displaying a steep reversal of fortune from previous years. The blockade

resulted in the loss of a number of short-haul flights, many of whom would have changed into

long-haul passengers in Doha (Bamber, et. al., 2013, 121). Some passengers found the increased

flight duration to be boring and less appealing (Mayer, 2014, 94). Eventually, there was an

overall drop in passengers by ten percent from forty-two million in 2017 to thirty-four million in

2018. At the country’s airport, few passengers passed through the aviation hub dropping from

thirty-six million to thirty-two million passengers (Dobruszkes and Van Hamme, 2015, 32). The
 Ashraf Ali

number of flights into and out of the airport dropped by twenty percent from two hundred and

fifty thousand, six hundred and eleven take-offs and landing to two hundred and ten thousand,

nine hundred and four.

Social

Nations and soft power branding are important aspects of the country to communicate

with international audiences around the globe. Qatar’s investment in nation branding and

diplomacy are effective in terms of promoting tourism, relationships with other countries, and to

gain influence in the international spectra. The airline has established itself in various soft power

resources such as the world cup in 2022, Al Jazeera, educational and cultural organizations

around the world.

Technology

Qatar Airways have adopted virtual reality into its operation ground training. The system

uses the latest technology to simulate real conditions for service training of operators and actual

airside ground handling conditions. The airline has taken the lead by being the first airline to

implement and adopt the technology at its airport in Doha Qatar. Additionally, the company

launched global beacon technology for customers and flight aware which are designed to track

and provide updated information of all its aero-planes. On the other hand, the airline recognizing

that healthy and satisfying experience is likely to lead to long-term customer loyalty. Losing of

baggage is the most horrible experience for passengers; however, the introduction of technology

to track the means that passengers are assured of the safety of their luggage. Qatar airline were

one of the first companies to incorporate RFID tracking device which captures and stores
 Ashraf Ali

accurate information on a chip stored in a baggage tag. From the fly Qatar app, passengers can

view their luggage off and on the plane which they can access in-flight.

Legal

The ban on electronic devices bigger than a smartphone was being considered as an anti-

terrorist precautionary measure. Phones and smartphones were not affected. Consequently, the

ban included nine airline companies from ten airports in the Middle East and covers the inbound

flights (Meyer, 2016, 119). The new security measures were a disruption to flights and

passengers.

Environmental

The airline has a vibrant environmental management system that ensures the

improvement of its overall continuous environmental performance. The environmental standards,

procedures, and policies are embedded in the whole of the organization.

Conclusion

From the airline’s marketing plan in the international market, it is evident that Qatar

airways is doing exceptionally well in the industry (Loftin, 2015, 121). Thus, there exist areas

that have been identified to be important in enhancing competitive advantage in the industry.

Therefore, Qatar Airways have the best opportunity of marketing Qatar Airline and reaching out

to new markets that have not been served more effectively.

 Ashraf Ali

Recommendation for Qatar Airline

Qatar Airways with its main activity in the transportation of passengers, it should

diversify its operations into cargo and holidays. Apart from that, the company should invest in

other airline as well.

The most important strategies that the airline need to improve are in-flight technologies

and enhancement of the customer process. Therefore, it is important for the airline to have

technological installations are done right or else small errors can interfere with the overall brand

image. Although, the management of Qatar Airline are drafting regulations and policies to

strengthen the relationship between employees and management, there is urgent need to look into

motivation and reward system for the employees (Meyer, 2016, 120). Additionally, employees

should be given intensive in-service training.

 Ashraf Ali

References

Abeyratne, R., 2018. Price Fixing and Anti-Competitive Conduct in Air Cargo Operations. In

Law and Regulation of Air Cargo (pp. 157-201). Springer, Cham.

Bamber, G.J., Gittell, J.H., Kochan, T.A. and Von Nordenflycht, A., 2013. Up in the air: How

airlines can improve performance by engaging their employees. Cornell University Press.

BELOBABA, P., ODONI, A. R., & BARNHART, C. (2016). The global airline industry.

Chichester, West Sussex, United Kingdom, Wiley.

BILYK, B. (2014). Effects of Deregulation in the Aviation Industry. München, GRIN Verlag

BISIGNANI, G. (2014). Shaking the Skies: The Untold Story of Change in Aviation since

9/11And the Biggest Turnaround of an International Organization in History. New York,

Oxford

Bowen, J.T. and Cidell, J.L., 2015. Mega-airports: The political, economic, and environmental

implications of the world’s expanding air transportation gateways. In Engineering Earth

(pp. 867-887). Springer, Dordrecht.

Cronrath, E.M., 2017. The Airline Profit Cycle: A System Analysis of Airline Industry

Dynamics. Routledge.

Dobruszkes, F. and Van Hamme, G., 2015. The impact of the current economic crisis on the

geography of air traffic volumes: an empirical analysis. Journal of transport geography,

19(6), pp.1387-1398.

Grant, R.M., 2016. Contemporary strategy analysis: Text and cases edition. John Wiley & Sons.
 Ashraf Ali

Green, J.E., 2015. Air Travel-Greener by Design. Mitigating the environmental impact of

aviation: opportunities and priorities. The Aeronautical Journal, 109(1099), pp.361-418.

Grimme, W., 2017. The growth of Arabian airlines from a German perspective–A study of the

impacts of new air services to Asia. Journal of Air Transport Management, 17(6), pp.333-

338.

JOHNSON, G., SCHOLES, K., & WHITTINGTON, R. (2018). Exploring corporate strategy:

Text and cases. Harlow, Pearson Education Ltd.

LOFTIN, L. K. (2015). Quest for performance: the evolution of modern aircraft. Washington,

NASA.

Lyashko, F.E., Prikhodko, V.I. and Tyutyushkina, G.S., 2014. Strategic management in the

aviation industry. Ulyanovsk: Ulyanovsk State Technical University.

MAYER, F. (2014). A case study of EasyJet and the airline industry. München, GRIN Verlag.

Merkert, R. and Hensher, D.A., 2017. The impact of strategic management and fleet planning on

airline efficiency–A random effects Tobit model based on DEA efficiency scores.

Transportation Research Part A: Policy and Practice, 45(7), pp.686-695.

MEYER, S. (2016). Acquisition of EasyJet plc. by British Airways plc. München, GRIN Verlag

GmbH. http://nbn-resolving.de/urn:nbn:de:101:1-2010082118112.

MORRELL, P. S. (2013). Airline Finance. Farnham, Ashgate Publishing Limited.

O’Connell, J.F., Williamson G. (2014) Air Transport in the 21st Century: Key Strategic

Developments, Ashgate Publishing.

 Ashraf Ali

O'Connell, J.F., 2016. The changing dynamics of the Arab Gulf based airlines and an

investigation into the strategies that are making Qatar Airlines into a global challenger.

World Review of Intermodal Transportation Research, 1(1), pp.94-114.

Rye, L., Blakey, S. and Wilson, C.W., 2016. Sustainability of supply or the planet: a review of

potential drop-in alternative aviation fuels. Energy & Environmental Science, 3(1),

pp.17-27.

SEATON, A. V., & BENNETT, M. M. (2017). The marketing of tourism products: concepts,

issues, and cases. Boston, Mass, International Thomson Business Press.

SIDDIQI, H. G. A. (2014). The performance of the nationalized industries: case of the U.K.

Airlines and Biman-Bangladesh Airlines. [Dhaka], Institute of Business Administration,

University of Dhaka.