BRANDING STRATEGY AND MARKET SHARE: A CASE

STUDY OF JET AIRWAYS

Shashi Kant Srivastava1, Shubharata Basu2, Raj Gururajan3
1
Doctoral Participant, Indian Institute of Management Indore, India
2
Professor Indian Institute of Management Indore, India
3
Professor University of Southern Queensland, Australia

Abstract
Branding Strategy is considered as an indispensable part of organization's market strategy by
managers. However, formulation of a branding strategy is exigent. Branding Strategy becomes,
even more, demanding in the event of new product, new service, or for a new market segment. A
mistaken branding strategy may lead to shrinking of the market share of an organization. The
market share of Jet was 34% in the year 2006, and reduced to 19.6% in the year 2014, and it is
believed that the confusion in branding led to the reduction of Jet Airways’ market share. This
phenomenon prompted this study to investigate the relationship of branding strategy and market
share in Indian air travel business, using a qualitative case study approach, with Jet Airways as
the case. The data were from the secondary sources including reports of airport authority of
India, annual reports of Jet Airways, interviews, and newspaper reports. The qualitative
instrument is specifically developed for this paper so that it is relevant to the Indian aviation
market. The results of this study indicated that incorrect brand strategy led to the inexact
business operation management. The inaccurate business operation culminated in withering
market share of the Jet Airways. These are discussed and reported in detail in the study.

Keywords: Branding Strategy, Brand Dilution, Market Strategy, Jet airways, Market Segment

Introduction
Branding strategy has far-reaching influence because it builds the vision and strategy for meeting
the needs and desires of customers (Urde, 1999). Right, business strategies of a company are
developed on a well-designed branding strategy (Davis, 2000). This makes it an imperative for
companies to concentrate on branding strategy design so that they remain competitive. This
article will provide a brief overview of the impact of branding strategy onto the market share of
Jet Airways, an important player in Indian aviation industry, using a qualitative approach. Indian
aviation industry is under persistent trouble (Shanker & Deshmukh, 2009). These troubles are a
lack of basic infrastructure, shortage of skill workers and professionals, stiff competition, and
rising fuel cost (Kanthe, 2012). In the past decade for certain airlines, this trouble was so much
that they completely vanished from the scene. The trouble of Indian aviation industry also
influenced the Jet Airways. Therefore, Jet Airline continuously observed the diminishing market
share after the year 2006. The factors that shrink the market share of Jet Airways and their
relationship to branding strategy are the objective of this study. The present research requires the
in-depth understanding of their business decisions and its consequences. The historical overview
of Jet Airways will be indispensable in this regard.
Jet Airways:
Jet Airways is one of the major players in the Indian aviation industry. The head office of the
airline is in Mumbai. It operates over 3000 flights daily to 74 worldwide destinations. Jet
Airways started its operation as air carrier on 5th May 1993. In January 1994, a change in the
Indian law enabled Jet Airways to apply for scheduled airline status. Henceforth, Jet was to
compete with state-owned Indian Airlines having a monopoly since 1953 in Indian domestic air
travel. After that, the first international operations of Jet began from Chennai to Colombo in
March 2004. On 12 April 2007, Jet Airways bought Air Sahara for INR14.5 billion (US$340
million) and Air Sahara was renamed as JetLite. Jet positioned JetLite as intermediate service
airline. In August 2008, due to the practical difficulty Jet announced its plans to integrate
completely JetLite into Jet Airways (Roy, 2008). Furthermore, due to increasing operational
challenges Jet Airways and till now their rival Kingfisher Airlines announced an alliance that
includes an agreement on following for mutual benefits (“Press Releases,” 2008).
1. Code-sharing on both domestic and international flights
2. Joint fuel management to reduce expenses
3. Common ground handling
4. Joint utilization of crew and
5. Sharing of similar frequent flier programs with other airlines. 
Due to fierce completion from low-cost carriers on 8th May 2009, Jet Airways launched its low-
cost brand, Jet Konnect. Now onwards Jet was operating in two market segments full-service and
low-cost. Here we must note a fact that Indian aviation market was still an immature market.
Therefore, the load factor was the prime concern for all airlines. Due to two market targets low-
cost and full-service, this became, even more, difficult for Jet. Jet Airways launched Konnect
brand on sectors having 50% or less load factor with the aim to increase it to 70% or above.
Low-fare airlines were also aggressive competing to increase their share. As a result of this
contest, Jet lost significant market share to these low fare airlines. Although Jet lost its first
position in Indian aviation industry in the year 2012 however, until mid-2014, it was very close
to its competitor IndiGo. In the year 2014 the share of Jet in domestic aviation sector suddenly
dropped from 25.3% in January to 19.6% in July (Economics Times, August 28, 2014). This
decline of 6% within six months was quite significant, and this gave enough reason to the
company to rethink their strategy and reorient their business plan to return to the previous shape.
In segment analysis of their share reduction, Jet found that the biggest loss of shares on Jet's
passenger base has been from its corporate travel division. This corporate share of the passenger
is especially in the small and medium enterprises (SMEs) segment. We understand the
importance of SMEs by a statement of Indian Prime Minister Mr. Narendra Modi that India's
65% economy is dependent on this sector (Economics Times, August 28, 2014). Further analysis
resulted that this decline happened due to the confusion in branding. Jet Airline was unable to
target the ruling market segment. US market demonstrated this phenomenon in 2005 that full-
service airline lost their market significantly to the low-cost carrier (Connell & Williams, 2005).
Without realizing this fact, Jet Airways always kept on increasing its full-service brand image.
Therefore, increasing the brand appeal of efficient operations from low-cost airlines like Indi-Go
and Go Air destroyed the leadership of Jet.
In this study, the three main constructs relevant to Jet Airways, branding strategy (BS), operation
management (OM), and market share (MA) are analyzed. The analysis is based on the qualitative
data available in public domain to understand the variations and interdependence of these
constructs.
Literature Review
Previous studies indicated that maximization of market share is a key component of management
strategy because it may lead to maximization of profit (G. Anderson, 1992). There are
innumerable factors that decide the market share of any firm. Few are conclusive but the
majority are obscure. Biggest conclusive factors on which market share of firms is dependent is
customer satisfaction (E. W. Anderson, Fornell, & Lehmann, 1994). High customer satisfaction
is the vital objective of operation management in service industries (Hung, Huang, & Chen,
2003). Therefore, customer satisfaction from the customer viewpoint and operation management
from organizations position are the largest concerns of firms (Quezada, Cordova, Palominos,
Godoy, & Ross, 2009). Operation management acts as an antecedent to customer satisfaction that
shows up in increased market share.
Apart from, operation management, other organization side factors decisive to market share are
knowledge and development, production, marketing, and distribution (Casson, 1987). Out of
these marketing is most pertinent under certain conditions (Gummesson, 2002). These conditions
are:

 Service is ongoing or has periodic desire

 The customer controls selection of the service provider,
 There are alternative service providers
The airline industry has all these conditions present. Therefore, airlines essentially focus on
marketing (Asiegbu, Igwe, & Akekue-Alex, 2012). Furthermore, branding is considered the most
powerful marketing weapon (Morgan & Pritchard, 2004). Successful branding needs befitting
branding strategy. Branding strategy as defined ‘a systematically planned and implemented
process of creating and maintaining a favorable reputation of an organization and its constituent
elements by sending signals to stakeholders’ (van Riel & van Bruggen, 2002 p.242) not only
dispense signals to consumers but also to itself. Branding strategy is critical for any
organizations for multiple reasons. Apt branding strategy connects consumers to the brand (Hart
& Mrad, 2013), it secures loyal customers (Herath & De Silva, 2011), and also helps
organizations to judiciously position themselves into the market (Jit Singh Mann & Kaur, 2013).
However, devising a branding strategy is not a simple task (Nygaard, 2008). Therefore, inapt
branding strategy may negatively impact many firms (Ngobo, 2011).
The branding strategy constitutes identifying market segment, positioning, and communication
of strategy (Frochot, Kreziak, & Safari, 2009). Studies have attempted to provide guidelines for
formulating felicitous branding strategy to mitigate future risk. For instance, there are three areas
that need to be focused on when formulating branding strategy. These areas include feeling of
the consumer, consumer’s financial value and his community (Bhatnagar, Maryott, & Bejou,
2008; Jones & Runyan, 2013).

There are many studies that investigated the relationship of a branding strategy to operation
management to the market share. However, there are limited studies pertaining to the airlines
context that combine these three concepts in one study. Few papers investigate the relationship
of any two of these constructs for air service. For example, Parton & Ryley (2012) demonstrate
the case of XL Airways. Rebranding XL Airways helped them to increase general public
recognition giving the advantage of increased market share. Gillen & Gados (2008) indicate the
conditions within which airline within airline concept or multi-branding may succeed. However,
most of the literature are focused on the success stories rather than failure. Whereas, for valuable
insights research suggest a failure to be more propitious than success (DeLeon & DeLeon, 2002).
Therefore, we select the case of diminishing market share of Jet Airways and investigate the
relationship of brand strategy and market share. Furthermore, we have not found any paper
investigating the ways brand strategy failure leads to withering market share. As a result, we
want to investigate following research question in context of Jet Airways:
Research Question 1-What are the factors of Jet’s branding strategy that culminated to its inapt
operation management?
Research Question 2-What are the factors of Jet’s operation management that culminated to its
withering market share?
The Research Methodology
This research is an exploratory research. Therefore, the qualitative single-case study research
approach is pursued. Research problem and corresponding research question guided the
selection of the research methodology as indicated in the literature review (Yin, 1994; Zikmund,
Babin, Carr, & Griffin, 2012).
Analytic Approach
Kappa statistic is used to test the inter-rater reliability. Two raters observed and assessed the
qualitative data provided by authors for each theme and sub-themes. In the provided data both
raters indicated the presence or absence of the main themes i.e. brand strategy and operational
management. Furthermore, in case, the text contains any of these themes the next level sub-
themes are assessed for its presence or absence. The theme of brand strategy is supposed to be
reflected by two sub-themes. One is fear of brand dilution and second fear of cannibalization.
The second theme operational management is reflected by single sub-theme as service quality.
A Kappa statistics more than .70 is considered as excellent whereas if it is less than .4, it is
considered unacceptable (Mor et al., 2003). The range of Kappa statistics between these two
values are acceptable (Mor et al., 2003). We apply these guidelines to evaluate our interpretation
of the data. The number of observations for the present pilot stage testing is nine. With two
themes and three sub-themes, there are in total 45 numbers of agreements/disagreements points.
Data Analysis and Discussion
Qualitative data obtained from various sources followed the data analysis procedure explained by
Hsieh, (2005). Content analysis followed the summative content analysis. The summative
content analysis is a combination of the two methods. First, conventional content analysis and
second directed content analysis. Following the guidance of conventional content analysis codes
were generated from the qualitative, these codes were summarized in the form of themes and
finally categories from various themes were formulated. For our research, we found two broad
themes. One, brand strategy and two, operation management. We found two sub-themes under
the brand strategy. One, fear of brand dilution and two, fear of cannibalization. The sub-theme
found under the main theme of operation management was service quality. The inter-relationship
of these two categories and their relationship to outcome variable is represented in the figure as
follow:

Fear of brand dilution Service Quality

Brand Strategy Operation Management Market Share

Fear of cannibalization

Figure-1 Brand strategy, operation management, and market share relationship

For the purpose of reliability the content or qualitative data along with generated categories and
sub-themes were shared with two independent raters. Raters were asked to mark the presence or
absense of categories and sub-themes in the provided textual data. The textual data was mainly
interviews of top executives of Jet Airways or analysis of market analyst. The agreement and
disagreement of these two raters were compiled and a score of Cohen’s Kappa was calculated. In
our case, the value of Cohen’s Kappa was found as 0.75. In line with established literature this
value is considered as excellent (Mor et al., 2003).

Implication
This paper adds to the literature in aviation business strategy in four ways. First, the paper has
devised the factors of a branding strategy that lead to the inefficient operation management of Jet
Airways. Second, the paper has provided a better understanding of determinants of operation
management of air carriers that may lead to shrinking market share of airlines. Third, the paper
with rigorous qualitative study argue the impacts of branding strategy on the operation
management of air service. Fourth, the paper demonstrates the rigor of qualitative study at two
levels for improved reliability. Inter-rater reliability is tested at two levels, at the level of
principle themes (constructs level) and at the level of sub-themes (factors level).
Conclusion and Future Direction
In-depth case, study of the Jet Airways revealed that air travel business in India is not a multi-
segment business. Because of their brand consciousness, management of Jet Airways took it as a
luxury product and kept on taking decisions to protect its luxury brand. Whereas in various other
context successful players have considered it as a commodity (Granados, Gupta, & Kauffman,
2007; Hooper, 2005). Because of an inaccurate understanding of their product, they formulated
the wrong brand strategy. Wrong branding strategy landed them to the requirement of service
differentiation, which became the reason of comparatively low service quality. Ultimately low-
quality perception of offered services became the important reason for their continuously
decreasing market share.
The present study uses a limited number of data points to qualitatively analyze the themes.
Future researchers may increase the number of data and present the robust research. Future
researchers may also validate the arguments presents on the base of qualitative analysis on
empirical tests. Brand strategy leads to operation management and operation management leads
to market share may be taken as two propositions to take the study forward.
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