King Saud University College of Business Administration The MBA Program

BA-549 Strategic Marketing Planning Case study:

"Emirates Airline 2009: Hub of the World"
Analysis Report

Prepared by:

Abdullah Al-Oraini Radhi Al-Hamed

Mohammed Al-Juaidan Abdulaziz Al-Thabity

Abstract:
This report is based on the case study "Emirates Airline 2009: Hub of the World". The

report encompasses an overview of the airline industry, an overview of Emirates airline and their services, and competitive analysis of heir major competitors. In the analysis part we made a SOWT analysis for Emirates, and then we defined the problems. Alternatives were addressed and evaluated to select the best one to help Emirates to manage the huge growth while maintaining profitability, high service quality, and the family atmosphere for employees with high productivity per employee. Finally, a detailed implementation plan is addressed.

Industry Overview:
There is no doubt that airline industry is extremely important in everyday life of

millions of people who travel all over the world: “The global airline industry consists of over 2000 airlines operating more than 23,000 aircraft, providing service to over 3700 airports. In 2006, the world’s airlines flew almost 28 million scheduled flight departures and carried over 2 billion passengers” (Ghaus, N.D., p.1). Two billion passengers seems to be a huge number, however, airline industry continues to develop extremely fast serving more and more people in different countries: “In the past decade, air travel has grown by 7% per year. Travel for both business and leisure purposes grew strongly worldwide. In the leisure market, the availability of large aircraft such as the Boeing 747 made it convenient and affordable for people to travel further to new and exotic destinations” (N.D., 2012, p.1). According to data provided by Ghaus, “the growth of world air travel has averaged approximately 5% per year over the past 30 years, with substantial yearly variations due both to changing economic conditions and differences in economic growth in different regions of the world. Historically, the annual growth in air travel has been about twice the annual growth in GDP. Even with relatively conservative expectations of economic growth over the next 10-15 years, a continued 4-5% annual growth in global air travel will lead to a doubling of total air travel during this period” (N.D., p.1). It is important to note that governments of all countries attempt to support growth of airline industry. For instance, officials of developing countries promote airline industry as a part of the program destined to improve infrastructure, attract tourists and bring funds to economy. Traveling with business purposes also becomes more overspread. It is connected with the fact that many companies are active on the international arena and

1). although the Asian financial crisis in 1997 and 1998 will put the brakes on growth for a year or two” (N. where the air travel market is already highly developed. a lot of airlines are unprofitable. 2012. The industry strongly depends upon international trade and economy: “During the first half of the 1990s.1). Not . slower growth of 4%-6% is expected.D. p. Emirates has grown in scale and stature not through protectionism but through competition. they will manage to take over smaller companies in the industry in the course of time. and is wholly owned by the government of Dubai directly under the Investment Corporation of Dubai. Naturally. where fast-growing trade and investment are coupled with rising domestic prosperity.. There are certain predictions regarding the future growth of airline industry: “Worldwide.D. 2012. 2012.000 employees. the industry suffered not only from world recession but travel was further depressed by the Gulf War. a leased Boeing 737 and Airbus 300 B4 from Pakistan Airline. p. Emirates is a subsidiary of The Emirates Group. This aim became especially topical and important after the global economic crisis. These rates are similar to those of the past ten years. Though wholly owned by the Government of Dubai.D. not quantity. forecasts international air travel to grow by an average 6. The most dynamic growth is centered on the Asia/Pacific region. airline industry will continue to develop significantly. p. International Air Transport Association.  Emirates Overview: On 25th October 1985. Then as now. I believe that only strong airlines will be able to develop fast and.. There is no doubt that future development of the industry will be tightly connected with traveling between Europe.6% a year to the end of the decade and over 5% a year from 2000 to 2010. possibly. In 1991 the number of international passengers dropped for the first time” (N. airlines usually take a number of measures to restore positive economic exponents of their business: “Many have tried to cut costs aggressively. their goal was quality. to reduce capacity growth and to increase load factors” (N. and in the years since taking those first small steps onto the regional travel scene. Taking into account a difficult economic situation in the world and the fact that a lot of airlines have to struggle for survival. Air travel for the region has been rising by up to 9% a year and is forecast to continue to grow rapidly. which has over 50. In Europe and North America. Emirates has evolved into a globally influential travel and tourism conglomerate known the world over for their commitment to the highest standards of quality in every aspect of their business. Emirates flew its first routes out of Dubai with just two aircraft.become global trying to enter new markets and attract new customers.1). competition with the evergrowing number of international carriers that take advantage of Dubai’s open-skies policy.. Asia and North America. Nevertheless. IATA. However.

the full suite with doors. financial condition including a 22year consecutive annual profit. flat bed 'Skycruiser' seat (without doors) and 'Sleeper' seats. and their network is expanding constantly.000 Emirates flights depart Dubai each week on their way to destinations on six continents. customer service trendsetters.only do they support that policy. long-haul aviation hub. In fact. The seat converts into a 2 m (6 ft 7 in) fully flat bed. Air Transport World gave Emirates Airlines the title of "Airline of the Year" for 2011. After making its initial start-up investment. The airline was also the seventh largest in terms of scheduled freight ton-kilometers flown. the government of Dubai saw fit to treat Emirates as a wholly independent business entity. a mini-bar. with a total value of approximately USD 84 billion as of November 2011. Emirates has made numerous significant announcements regarding the future of its already state-of-the-art fleet. The full suite options come complete with closing doors to ensure privacy. The company also operates three of the world's ten longest nonstop commercial flights from Dubai to Los Angeles. The airline has recorded an annual profit in every year since its third in operation. Over 1. Emirates order-book stands at more than 230 aircraft. and today they are thriving because of it. fleet size. San Francisco. In recent years. In February 2011. but they see it as vital to maintaining their identity and their competitiveness. In 2010 the airline was the sixth-largest airline in the world in terms of international passengers carried and largest in the world in terms of scheduled international passenger-kilometers flown. a coat rack and storage. Private . and has become the largest airline in the Middle East in terms of revenue. They also feature the ICE system on a 23 in (58 cm) LCD screen. Emirates currently fly to over 115 destinations in more than 60 countries around the world. and passengers carried as of 2007. The airline ranks amongst the top 10 carriers worldwide in terms of revenue and passenger kilometers.  Cabin: Background about the Product First Class There are 3 types of first class seating. In combination with what is already the youngest and one of the most modern fleets in worldwide commercial aviation. Houston and Dallas. this commitment to the future reflects their goal to develop Dubai into a comprehensive. With a fleet of more than 170 aircraft. global. The award has been given based on recognition of its commitment to safety and operational excellence. Emirates flights account for nearly 40 per cent of all flight movements in and out of Dubai International Airport.

In 2009. Due to the unique staggered layout. along with the ICE system and a 19 in (48 cm) screen. First class seats may also include a personal minibar. On Airbus A330 aircraft and A340-300s. These business class seats are smaller than other business class seats in the Emirates fleet as these aircraft are used predominantly on short-medium haul routes. as well as 27 of 39 3-class Boeing 777-300ER aircraft. Amenities include massage function. the seats are standard business class recliners and feature a leg rest and seat back screens. Business class passengers have the ability to customize and save seat and in-flight entertainment settings to a memory key for re-use on future flights. The Boeing 777-200s and remaining 777-300ERs have deeply reclining seats which are almost lie-flat. two individual reading lights and an overhead light per seat. the seats recline to form a fully flat bed and are equipped with personal mini-bars. first class features private suites. Skytrax had said that the Emirates A380-800 product greatly helped influence its position. Business class passengers also have access to an on-board bar at the rear of the aircraft. Emirates was voted the second best First Class by Skytrax. They have a 58 in (150 cm) pitch and are 20. USB Ports and an RCA socket for laptop connection. The A340-500s have deeply reclining sleeper seats which have a 60 in (150 cm) pitch and are 18 in (46 cm) wide. Boeing 777-300s and 29 of 39 3-class Boeing 777-300ERs as well as 5 of 14 2-class 777-300ERs feature seats with a 60 in (150 cm) pitch that recline to 79 in (200 cm)-long. Boeing 777-200LR aircraft. On Airbus A380-800 aircraft. On its newly delivered A380-800. over 600 channels of entertainment on ICE.5 in (52 cm) wide.suites are available on all A380-800. The seats feature a pitch of 72 inches (A330-200) and 86 inches (A340-300) and lie nearly flat. shown on a 17 in (43 cm) wide TV screen. 'Sleeper' seating is available on 3-class A330-200 and A340-300 aircraft. at only 70 inches long. Business Class Business class on Boeing 777-200LRs.[146] Premium class seating is located on the entire upper deck of A380-800 aircraft. privacy partition. 'Skycruiser' seating is available on the remaining 12 Boeing 777-300ERs. Boeing 777200s and Boeing 777-300s feature seat that extend to flat beds using integrated passenger seat control. angled lie-flat beds. in-seat power supply. two showerequipped lavatories and spa. half of the business class seats on Emirates A380 are 9 inches shorter than the others. All A340-500 aircraft feature the ICE system in all three classes. winged headrest with six-way movement. . and access to the first/business class bar area and lounge. A340-500. The Boeing 777-200s also feature the ICE system.

Emirates has won the award for best in-flight-entertainment from Skytrax for their ICE system every year since the systems inception in 2003. and Air New Zealand (only on 777-300ER aircraft). Boeing 777-300ER/ULR and Boeing 777-200LR/ULR aircraft. Emirates is unusual in that it operates a ten-abreast. . This results in a cramped cabin environment especially during meal times due to the reduced width of the seat. ICE offers more channels than any other in-flight entertainment system. Introduced in 2003. Also available are BBC headlines. ICE is available on all new aircraft and features between 600 and 1200 channels to all passengers. Airbus A340500. and Entertainment) is the in-flight entertainment system operated by Emirates. Communication. ICE is found on the airline’s Airbus A380-800. The seat features adjustable headrests.Economy class Emirates Economy Class offers a 32–34 inch seat pitch (81–86 cm) and standard seat width (except on the Boeing 777 fleet). In-flight entertainment system Emirates became the first airline in the world to introduce a personal entertainment system on a commercial aircraft after introducing the world’s first seat-back screens in 1992. There is additional recline on A380 Economy Class seats. All three classes feature a personal in-flight entertainment (IFE) system on Emirates aircraft. seating configuration on its 777 fleet (rather than the customary 3-3-3 or 2-5-2 configuration). 3-4-3. ICE ICE (Information. and 30% of the Emirates fleet offers passengers with 15 video and 26 audio channels. an airshow and external cameras giving a bird's eye view from the plane. Other airlines with this layout include Air France-KLM (except on 777-200ER aircraft operating for KLM). and Emirates TV & Radio. China Southern Airlines. a 600–1000 channel ICE In-Flight-Entertainment and in-seat laptop power-outlets on newer aircraft and laptop recharging facilities in galleys in older aircraft. Emirates TV&radio is also offered mainly on short haul routes. There are three types of entertainment system on Emirates: ice. At present. almost 70% of the fleet has the ice in-flight entertainment and by 2011 the entire Emirates fleet is set to have the system. It is also available on all Boeing 777–300 aircraft which have all been retrofitted. ice Digital Widescreen. as well as 50 video games. Philippine Airlines.

and around 50 video-game titles.'s iPod portable music and video player as of mid-2007. or movies stored on the iPod. during takeoff and landing. Arabic. as well as at certain stations of the Dubai Metro. . 350 audio channels. Spanish. forward. Exterior cameras located on the aircraft can be viewed by any passenger. ICE Digital Widescreen is available on all new aircraft.In July 2007. Emirates was also one of the first airlines to introduce high-speed. 60 prerecorded television channels. Information The system is based on the 3000i system from Panasonic Avionics Corporation. This allows the device's battery to be charged. Emirates introduced ICE Digital Widescreen. It offers over 1200 channels of entertainment (up from 600) available to all passengers. an updated version of ICE. Korean. French. Communication ICE also contains a link to an in-flight email server which allows passengers to access send or receive emails for US $1 per message. In November 2006 the airline signed a deal with mobile communications firm AeroMobile to allow in-flight use of mobile phones to call or text people on the ground. and rewind them. ICE can also be accessed in 10 languages such as English. and video games. in-flight Internet service along withSingapore Airlines. This is complemented by ICE's Airshow moving-map software from Rockwell Collins. television shows. through the IFE system. ICE also contains a seat-to-seat chat service. on selected 777s. ICE is the first IFE system to be connected directly to automatic news updates. but also allows integration with Emirates' in-flight entertainment (IFE) system. This may be done over the counter or at the lounge within the airport. Emirates now feature docking capability for Apple Inc. German. all entertainment options are available on-demand to all classes with options to pause. The service was first introduced on a commercial service between Dubai and Casablanca on 20 March 2008. by installing the Inmarsat’s satellite system and became the second airline in the world to offer live international television broadcasts using the same system. ICE offers over 130 ondemand movie titles and 15 video on demand channels. as well as function as a control system. Ground services Passengers may check-in between two to 48 hours prior to flight departure. Since 2003. ICE provides passengers with a direct data link to BBC News. and Japanese. This also enables the IFE system to play music. Self-service kiosks are also available at Dubai International Airport. Entertainment The ICE system includes movies. music.

Lounges First and business class passengers. which started operations in October 1985. It is used by over 5. Emirates SkyCargo operates dedicated cargo flights to 20 destinations in 15 countries from Dubai International Airport. Passengers on short trips may also check-in on their return flight upon departure from the city of origin.600-square-metre (469.72 million customers. The three primary tiers are Blue. In 2008 Emirates SkyCargo moved its operations into a 43. they may check-in through the Internet or by short message service. During the financial year 2008-09. Since then it has been the main cargo division of Emirates. and the anchor cargo airline at Dubai International Airport. Skywards is a four-tier frequent-flyer program operated by Emirates.000 employees. accounts for 20% of Emirates’ transport revenue. Emirates SkyCargo. an improvement of 9.408. which requires 50.Alternatively.000 tier miles for entry. It is the air freight division of Emirates. . it also operates freighter aircraft to various destinations. Skywards Silver members can use the lounge in Concourse 1 at Dubai Airport. Whilst using bellyhold capacity in the Emirates' passenger fleet. and through the Emirates network has access to additional 79 destinations. Emirates SkyCargo is a subsidiary of The Emirates Group. Cargo Service: Emirates SkyCargo is a cargo airline based in Dubai. have access to Emirates Lounges. and Gold. as well as Skywards Gold and Silver members. which has the capacity to process 1. which has over 40. Online printing of boarding passes is available through Internet check-in. At airports in which Emirates does not operate a departure lounge.000 sq ft) Cargo Mega Terminal. and is wholly owned by the Government of Dubai directly under the Investment Corporation of Dubai. EmiratesSkyCargo carried in 1. the same year Emirates was formed. United Arab Emirates. Frequent-flyer program Emirates uses Skywards as their frequent-flyer program.8% compared to the previous year. its main hub.300 tonnes of cargo. Silver which requires 25. Chauffeur-drive First and business class passengers can make use of complimentary chauffeur-driven airport transfers in selected cities.2 million tonnes of cargo annually. The airline has 28 lounges in 26 cities.000 tier miles for entry. a third party departure lounge is usually provided for First and Business class passengers as well as Skywards Gold members.

and for the other domestic airlines we will take Etihad airlines. the UAE government does not support them in the crises. and this is in order to cut the costs. Also. single-class. an Alarabia airline has been able to keep low-cost. the tragedy of 9/11 was the initial factor leading to the downward spiral of failure that the current airlines face today. there are two airlines that are flourishing with achievement amongst the failing industry. Emirates airlines and Southwest airlines. to provide the low tickets. for the international airlines we will take the Lufthansa airlines. Alarabia airlines cannot land in Dubai. the International Air Transport Association (IATA) reported that the airline industry suffered a net loss of $8 billion dollars during 2008. also Alarabia cannot go too far. and the economy. Also.  Competitive Analysis: The airline Industry is a complex business that is affected by many internal and external factors. aspires to become a much larger airline. The current failures are most affected and influenced by competition. it's landing in Alsharjah. We will take in our process for the analysis for the competitive analysis two domestic airlines. The successes and failures of this industry are constantly fluctuating over time. Emirates airlines do not has this benefit. on-time and reliable airline. the main opportunity for the Etihad airlines is the advancement of the jet engine into a turbine-propelled in their aircrafts. technology. Currently. Alarabia airlines strategy is to provide the basic services to their customers. An Alarabia airline. there was a unique way of operating has generated a consistent profit throughout the most influential factors that affect the industry. low-fare competition and filling seats with leisure passengers using discounted tickets.As of 2009. Also one more disadvantage for Alarabia airlines. and gain access to a wider market. and if you want to go to Dubai. For Emirates airlines. Emirates SkyCargo is the seventh largest cargo airline in terms of the total freight tonne-kilometres flown and sixth largest in terms of international freight tonnekilometres flown. and one international airline. you cannot take more bags. especially financially. While it is evident that the airline industry is suffering as a whole. Another benefit for the Etihad airlines is the technology. a small regional airline. While deregulation brought great triumph and positive change. An Alarabia airline has the pros of low tickets prices. Alarabia serves small locations throughout the MENA area. Alarabia airlines bay high taxes in order to land in the main airports. Then. They pride themselves on being an efficient. Etihad airlines are campaigning aggressively to ensure passengers have the latest technology and the best available service at . But the main issue in Alarabia now. the UAE government support them in more than one dimension. for the domestic airlines we will take one economic airline which is Alarabia. For Etihad airlines. Currently. This advancement in technology can greatly reduce operating cost by cutting the amount of fuel used as well as the down time of planes. you have to take a taxi from Alsharjah airport to Dubai. buyer power.

increasing competition between them and the other European airlines. Business. Lufthansa faced with rising aviation fuel prices. but prestige airlines. the government support may will have a negative impact on their competences in the future. Lufthansa Airlines became the first airline to establish the biggest home page on the internet and now attributes more than 25% of its passenger revenue from its internet site. The Germany government does not support them in crises. It has also purchased a stake in other airlines to gain access to the main airline markets in those regions and countries in which it does not operate in order to achieve a global mode of operation. Lufthansa airlines must be commended on an impressive number of customer options.com. There are four major airline alliance groups. and a directory of international Etihad airlines offices through their WAP-enabled phones. and mid income people. Other limitations for the Lufthansa airline are the restrictions in the global market of ownership of foreign carriers. also the current issues are directly related to the high costs and sagging revenue. The major weakness for the Lufthansa airlines is the replacement and maintenance of their aircraft as the planes age. and this will suffering them in the future. The major weakness for Etihad airlines is the high rate for the tickets. Passengers can access information on flight schedules and promotions. including luxury sleeper seats and international cuisine. Passengers can choose their own movies to watch or CDs to listen to from the extensive collection on board. Etihad airlines. one of them is Star alliance which led by Lufthansa. Airlines are cooperating with other carriers through alliances.Lufthansa. Etihad airlines has launched a mobile phone service using WAP. and economy classes. after visiting the website. they had new openings into Asian countries and additional flying routes being launched. is not a performance airlines. Also. today there has been an important growth of strategic alliances in the airline industry because of the airlines wanting to compete at a global scale. Then. www. and this is one of the Lufthansa pros. Also. Alongside in-flight improvements. . and this is in order to overcome their costs. Etihad airlines has introduced a range of new creature comforts to its first. The price of jet fuel on average has increased by almost 60% globally from February 2006 to June 2010.their fingertips. For Lufthansa. Etihad airlines has implemented a new entertainment system. they do not target the segment of low. The Lufthansa airlines goal is to become a global carrier and it has entered into strategic alliances to overcome competition by cooperating with other partners and by purchase of airlines in other countries. In keeping with this new technology focus. one more threat facing the Lufthansa airlines is the cost of fuel to power the jets.

89 months. and Europe.000 kilometers. and developing the staff: They communicate vision. fleet size. The Dubai Airport and the new airport in Jebel Ali are considered from largest airports in the world. it has very fast growth. Also. It's not the traditional model of the western world. and also it hosts many international sport events and international conferences.000 kilometers per average trip in 2003—provided operating efficiency relative to flag carriers such as British airways. it doubled in size every 3. Dubai considered one of the important commercial cities in the region. Emirates is placed at the middle of a market with four billion people: China. India. value. the Russian Federation. and strategic plan to first line staff and emphasis cost control with them. it's the combination of the best of each cultural style.000 to 3. Also. such as. 11 September attack. High quality of service: Emirates is superior in quality of service provided to customer and win the "Airline of the Year" The Sophisticated Dubai: The huge growth of Dubai infrastructure and facilities. compared with an industry average of 156 months. Youngest fleet in the industry: Emirates Airline operates one of the youngest fleets in the industry with an average age of 65. SWOT Analysis: Strengths: One of the largest airlines in the world: Emirates considered one of the well-known airlines in the world in term of revenue. High operations efficiency relative to others measured by trip length: Analysts estimated that Emirates’ longer trip length of nearly 4. Also. growth has never fallen below 20% a year. Strategic location: When we look at the Middle East. In its first 11 years. Emirates consist of more than 80 nationalities. They have small managements team and get a decisions very quickly. and the economic recession in 2008/2009. Dubai is very attractive for tourisms. Air France and Lufthansa with average trip lengths in the range of 2. and passengers carried. They are good in managing crises: Emirates Airline was one of very few airlines in the industry that survived from many global crises and still profitable. South-East Asia. They are good in communicating. learning. Flexibility and fast decisions making: Managements are working in very informal basis. it's multicultural environment working together as a family. it's much more fluid. . they are providing a periodic training and development of their staff. Diversity of the senior management style and the multi-nationality staff: Managements are different people from different places bringing a wealth of experience.5 years.

More opportunities were offered to UAE National. Emirates faced regional competition from Qatar Airline which is considered one of the best airlines in the world and with very aggressive growth. One half of this investment was spent on advertising in the six continents where the airline flew and 40% was allocated to sports sponsorships. Also. On the other hand. Emirates getting complex and expenditures start increasing. Air Arabia started to operate from Sharjah. Emirates was not saddled with legacy systems or archaic legacy trade union agreements. UAE. In October 2003. - Dis-economic of scale: Emirates management worried reaching a point where the airline could start to face diseconomies of scale. Unlike other airlines. events and media relations. promotions. at the manager level the percentage of UAE nationals is about 25%. - Strong branding strategy: Emirates’ branding strategy is key to its international growth. The airline spent approximately $300 million per year on sponsorships. Fluctuation of demand and inability to forecast: Fluctuation in consumers demand affect the ability of future expected demand while Emirates made huge investment in the aircrafts.- Attractiveness of Emirates environment: Employees were attracted not only by Emirates’ reputation as an employer of choice. Oil prices: Fluctuation on oil prices is highly affecting the cost of operations. Then Etihad Airways from Abu Dhabi started as aggressive competitor to Emirates. Threats: High competitive regional and international market. but also by the competitive salaries. Lack of UAE nationality: UAE National recruitment is a big challenge. . only about 5% of the staff are UAE Nationals. the first low-cost carrier in the Middle East. because oil cost considered the second large component of operations cost. Emirates faced competitor from other international carrier like Lufthansa and British Airways Airlines industry is highly affected by the economic crises: Airlines industry is very sensitive to economic crises. the lifestyle offered and the absence of income tax for Dubai residents. As we seen Emirates recorded significant decline in profit during 2008/2009 recession. many suffering huge loss or bankruptcy. Weakness: - No formal succession plan: Emirates Airline does not have a formal succession plan for its senior managements. it relied on robust HR systems to redress staff concerns. Furthermore.

Internal marketing is central to this objective. Improving productivity. Organizations thrive on the ability of employees and business partners. Optimizing use of resources and competencies to convert opportunities into revenue is the objective of an efficiently run enterprise – internal marketing facilitates this by accurately and continually communicating the right message to all stakeholders. Managing the huge growth of Emirates Airline while maintaining profitability. Emirates getting complex and expenditures start increasing. The long-term sustainability of the business depends on company’s willingness and ability to continue delivering value and a positive experience to customers. Leveraging Emirates Airline’s infrastructure business to get first choice.Opportunities: Development of more advanced airline services: To develop continuously new generations of more advanced airline and aviation services.Development of Internal Marketing Programs: Internal Marketing is the ongoing process whereby an organization aligns. and deployment of measurement system. enthusiastic and skilled workforce boosts productivity. and the family atmosphere for employees with high productivity per employee . high service quality. 2009). . Opportunity to tap budget travelers' market. Below is the list of challenges sorted by priority: 1. Challenges to increase the number of UAE nationals in the company.(Mulhern . a well-informed.  Problem Definition: There are many challenges faced by Emirates.  Alternatives Evaluation: For the alternatives evaluation. 2. minimizes costs and facilitates a mutually beneficial customer relationship to strengthen the external value of the corporate brand. the following are the three suggested alternates to them: 1. 4. our target is to find solutions for Emirates airlines in order to overcome their challenges. motivates and empowers employees at all functions and levels to consistently deliver a positive customer experience that helps achieve business objectives. and in result tap into more markets. Building global hub-and-spoke system: Passengers able to fly from any major city in the world to any large destination through Dubai. Diseconomies of scale. 3.

. including empowerment. e-learning programs. actively encouraging participation.e. i. Each segment will require a different approach to convince them to buy into the new initiative. posters and pamphlets informing about new initiatives. It is far easier to convince external customers to believe in the brand if internal stakeholders believe on it. internal rules. Like external customers. they too have their own ‘buyer’ behavior. the web allows the employees to form communities based on their personal likings and unofficial designations/department affiliations. These are intranets. Broadly speaking there are three segments – supporters. This allows effective employee bonding. branding and learning at both the formal as well as informal (cultural) organization levels. One goal of internal marketing campaign should be to improve employees' perception of the organization. company events. By the same token. better systems. Each segment requires a different internal ‘marketing mix’ to deliver on internal marketing goals. The Internet is an exceptional internal marketing tool: The Internet offers one of the best platforms for a consistent internal marketing experience across regional. The web’s self service function and anytime/anywhere accessibility allows employees to leverage internal marketing programs without significantly impacting their primary job roles. Proven web tools include intranets or even an internal facing website that creates online events. internal marketing needs to accurately segment internal customers. newsletters. Besides this. Intranets/websites also serve to keep employees consistently and accurately informed about the latest organizational initiatives and innovations so that they can leverage them when interacting with external customers. understanding personal hardships and ongoing training & up skilling. discussion forums. internal marketing thrives on delivering long-term value to internal customers (employees). Through various approaches. policies and procedures. neutral and opposes.External marketing thrives on the premise of delivering long-term value to external customers. shared responsibility and accountability. extranets (partner communication on the web). identifying with the changes which organizations plan to implement. To be effective. Effective and efficient communication of Internal Marketing: There are various techniques and tools that help organizations implement effective internal brand building and marketing communications. national and international sections of an organization. ‘expertise communities’.

Internal Marketing Challenges:         Managerial incompetence in interpersonal. The web also facilitates instant internal information sharing on new achievements. also Emirates had relied on informal networks of cabin crew to monitor and enforce consistently high service quality. within the organization. Creates good coordination and cooperation among departments of the business. Helps non-marketing staff to learn and be able to perform their tasks in a marketinglike manner. . people can leverage them to work in an efficient. 2. Proper information flow within the organization. so companies can evaluate what does and doesn’t work. Increase employees' performance and productivity. Cabin crew teams. Ignoring and not listening to subordinate staff. Better understanding of the organization goals and objectives by effective communications. initiatives and innovations. The Internet is the most potent yet customer-friendly internal marketing tool and it also facilitates tracking. moreover. Resistance to change. Empowers employees and gives them accountability and responsibility. but as the number of personnel increased.As the web enables the building of communities. Unnecessary protection of information against employees. Improve employee loyalty and reduce turnover. Pros:           Foster a strong relationship between employees.Standardization of Service Provision and Internal Business Processes: Since Emirates Airline getting more complex and hence expenditures start to increase. Foster "Learning organization". generally consisted of multiple nationalities and typically had less than half hour to form a team before boarding begin. The tendency of ignoring employees' importance and treating them like any other tools of the business. Satisfied employees lead to satisfied customers. collaborative manner. Individual conflict and conflict between departments. employees and senior management. technical and conceptual skills. cabin crew members often did not know one another or had not worked together in the past. Rigid organizational structure. Poor understanding of internal marketing concept.

Standardization ensures swift communication between employees themselves and between employees and customers which leads to great efficiency and high productivity with minimum costs. which minimizes errors. In addition to immediate communication benefits. here we do not intend the industry standards. Standardization describes a process of unification. Personnel: Standardization of personnel qualifications facilitates the recruitment of appropriate workers. This encourages transparency for the customer. it's suitable for Emirates to standardize their service provision. This area of standardization is important because customers often choose a service provider primarily on the basis of personnel and the quality of the services they deliver. The quality of results is further supported by uniform processes for the evaluation of the provided service. to develop performance measurement system that link to the senior managers to monitor the performance of their services. is to establish a clear rules and procedures to standardize their business processes across the organization especially that touch their customers.For these reasons. and organizational processes. What Emirates needs to do. it is important to identify areas with a potential for standardization in which customer demand also exists: Terminology: Unambiguous communication between employees themselves or between employees and customers is only possible through the description of services using clear terminology. Because every employee knows exactly where everything is and how to do his/her job. but Emirates' internal standards. In a first step towards standardization. capabilities of personnel. Results: Standardized results are achieved through the establishment of qualification requirements and standards that define how a service is to be provided. Also. Processes and approaches: The standardization of processes or approaches clearly defines how a service is to be provided. technology. allows exchange among different users. Technical systems: The standardization of technical systems and their interfaces. and can in turn be utilized as a referential standard in the development of more innovative services. especially in terminology. standardization of terminology serves as the basis for the development of additional standards. Each employee should receive extensive training for the rules . often described as compatibility standards.

2) Emirates Airlines have to gather feedback from their customers. During the interview. they have to notice the negative and positive aspects of the interviewees' personality. sometimes better.and procedures that related to his/her job and each employee should be evaluated based on his/her compliance with the standards. Less Engagement and empowerment of employees. Pros:      Attract and assure customers about the service quality. They should verify with their past employers their experience and attitude toward the workplace to see if they have the skills and character needed for the position. Fast communications between the staffs. Take customer comments into consideration and implement valid concerns through new policies. Does not lead to a coherent team members. than what a standard dictates. Encourage their employees to develop professional relationships with the customers to ensure that customers can express their opinions with ease. Cons:      3Inflexibility. Standards need to be revised frequently in response to rapidly changing circumstances. Increase in efficiency and productivity. a negative workplace and tarnished reputation that is difficult to overcome. They should reduce the barriers for customers to communicate their feedback and create many forms of . Customer service requires both managers and employees to work hard. remain ethical and sacrifice personal comforts to meet the expectations of the customers. Maintain a great customer services for Emirates Airlines: We should know that. a 5 percent decrease in customer defection rate can cause a 25 to 80 percent increase in profits. a great customer service causes a customer to feel valued and stay loyal. and may force to provide a service in certain way when other options are just as good. Create competitive advantage. Cost-effective. Poor customer service has harrowing effects such as decreased profits for the company. Customers are different and may need a different treatment for the same service. According to TeleFaction [Consultant Company]. These points are : 1) Emirates Airlines should hire employees that display interest in the company and they including the company in their overall career goals. Because they just receive orders.

experience and education. Investing the time. They have to give employees specific guidelines for handling common customer issues to streamline the process and enable them to solve issues briskly. and the use of the keypad as options (i. 4) They have to develop detailed procedures for handling customer complaints. even for employees who are behind the scenes. Customers will be relieved to speak to a qualified employee to address their problems.e. Returning customers are one of the main components to success. or by automated means. 6) Emirates Airlines should create rewards for returning customers. They have to construct incentives for customers to provide feedback such prize drawings for completing surveys. "Press 1 for English. They have to seek expert advice at conventions and research breakthroughs within the industry that apply to their Airlines. They have to reward employees who maintain exceptional customer service. Offer discounts. Another example of automated customer service is by touch-tone phone. at least. An advantage with automated means is an increased ability to provide service 24-hours a day. They have to give feedback regularly and schedule timely performance evaluations. prizes and free products or services to reward customer loyalty. They have to encourage employees to use their knowledge. They have to give the appropriate leeway in company policies to create flexibility for the customers. They have to update the skills and transfer the information to the employees through retraining. 5) Emirates Airlines should hold employees accountable for their actions. 3) Emirates Airlines should use the feedback to improve their service routinely.simple contact. etc(. resources and money necessary to address customer complaints and perfect their service. which usually involves a main menu. They have to attempt to foresee any problems with their service to strengthen the employees' knowledge on issues they may encounter. They have to assign each employee a role in quality control. . They have to designate a role for employees in resolving specialized complaints that match their background. They have to study the service beforehand. Press 2 for Spanish". education and prior experiences to suggest any needed changes. Emirates Airlines and Automated customer services: Customer service may be provided by a person. They have to give advice on effective methods for handling difficult situations with a calm and positive attitude. Examples of automated means are Internet sites. which can. instead coach employees. be a complement to customer service by persons. They have to refrain from being harshly critical. Thoroughly explain to each employee his role in providing great customer service.

Also. Emirates Airlines and Social media : Social networking websites allow individuals to interact with one another and build relationships. The result can be a steady revenue stream and consistently fulfilling a . Happy customers become repeat customers . therefore reaching more people. there are a number of benefits of customer service :  Satisfied Customers & Customer Relationship Management: The first benefit of customer service is obtaining customer retention. Pros: It isn’t fun to have a bad experience with customer services. Google Plus. they can cut the costs. Facebook. But this lack of visual and tactile presence makes it even more crucial to create a sense of personal. when Emirates Airlines using the automated customer services. With that said. all of the users connections are able to see the message. That interaction feels personal to users because of their previous experiences with social networking site interactions. in the Internet era. Automated means can be based entirely on self service. YouTube. because the information about the services is being put out there and is getting repeated. Customer retention occurs when a product or service is consistent in what it’s supposed to do. people can interact with their services. An automated online assistant providing automated customer service on a web page.However. By repeating the message. services can reach a very narrow target audience. It can avail for enterprises to reduce their operating and training cost. but may also be based on service by more or less means of artificial intelligence. more traffic is brought to the services of Emirates Airlines. by choosing whom to follow on these sites. Through social networking sites. Sometimes. When Emirates Airlines join those sites. many companies employ a customer relationship management system to help keep customers happy. Studies show strong customer service pays great dividends to an organization’s long-term stability and growth. Online customers are literally invisible to Emirates Airlines. a challenge has been to maintain and enhance the personal experience while making use of the efficiencies of online commerce. This personal interaction can instill a feeling of loyalty into followers and potential customers.  Customer Loyalty & Loyalty Marketing: A key indicator of quality customer service is customer loyalty. Emirates Airlines can have conversations and interactions with individual followers. So. and enhancing the provided services. Social networking sites like Twitter. expectations are not met when you are on the other side of the phone. Pinterest and blogs allow individual followers to “retweet” or “repost” comments made by the services being promoted. Customer loyalty means what it says. Social networking sites act as word of mouth. human-to-human connection in the online arena. so it's easy to short change them emotionally. Examples of customer service by artificial means are automated online assistants that can be seen as avatars on websites.

freebies.  Not ensure a coherent team member and productivity improvement.  Edge on Competitors With Good Customers Relationship Management: If your organization out-performs another competitor in customer service.  Less Engagement and empowerment of employees. most likely. However. if you reward customers for their loyalty (with rebates. The benefit of customer service comes into play here. it doesn’t necessarily mean the more expensive competitor will lose its customer base.  Maximizing the Customers’ Experience: Today’s customers are more selective and demanding. Their expectations regarding their service experiences are higher than ever. 73% report they left a service provider because of poor customer service. your organization will be one of the leaders in your industry. The typical customer will tell between 8 and 25 people about a negative experience. According to Accenture’s 4th Annual Study on Customer Service for the United States.costumer's expectations increases the customer's loyalty. coupons.  Promotes Customer Service Employee Retention: Customer service representatives who understand they are the face of the company will help them communicate with customers on the other side of the phone. The typical customer will talk to people about a negative customer service experience than a positive experience. A thorough customer service program will help maintain an existing customer base rather than lose a percentage of it. Cons:  Focus only in external customers. Interestingly. etc. versus only 47% who left because of a lower price. Proper training in handling phone calls and trouble-shooting issues can promote job satisfaction. which translates into longer employee retention.) they feel valued for their choices and continue to remain a consumer of a company's product or service. Statistics show that it costs more to gain new customers that it is to retain existing ones. A study by US News and World Report reports 68% of why customers leave a product or service for a competitor is because of a bad experience. A typical customer will only tell one or two people about a positive experience. if a company offers a product or service at a higher price than a competitor. . and the Internet continues to increase this exposure. Customers who are not satisfied with the service they receive spend their hard earned cash elsewhere.  Less Costs Needed to Attract New Customers: Quality customer service relieves pressure on the organization to attract new customers.

The matrix contains some points of interest that need to be addressed in order to solve Emirates’ challenges.” Web. Some customer service practices may encompass high costs.htm .8 0.8 0.). “Airline Industry Overview. Points of interest Coherent team Productivity Service quality Implementation cost Engagement Brand loyalty Total 0.6 0.1 0. 30th Mar. (N.2 1.6 0. we see that “Internal Marketing” has the greatest weight except for the implementation cost and the service quality points. If we look at the points of interest in the table.  Implementation Plan:  Resources Ghaus.2 Standardization Rating 2 3 3 4 Weighted 0. 2012.1 Internal Marketing Rating 4 4 3 2 Weighted 0. We have selected “Internal Marketing” because it has the greatest net advatages. like "service recovery". Retrieved from http://shiftfiles.4 0.4 Weight 0.4 0. M.1 0.2 0.6 0.8 0.0 4 4 3.4 Customer service Rating 3 2 4 2 Weighted 0.  Selection of the Best Alternative: We develop below an alternatives matrix in order to choose the best alternatives among the three mentioned above.2 According the above table we select the internal marketing as the best alternative. Internal marketing considers all the aspects of Emirate’s issue. Internal marketing contains the greatest strength and the fewest disadvantages.6 0.5 0.6 0.2 0.8 1 2 2.2 0.com/files/130349E_airline-industry-overview-21732.4 0.4 2 2 2.D.6 0.2 0. Every point of interest is weighted and every alternative is rated to choose the best alternative that contributes to solve Emirates’ issues.

Retrieved from http://www. Cases.roi.com/files/130348E_airlineindustry. (2011).raa. Boston: Mc Graw Hill.D.).com .T39ZFez8kox.com/sa/English/about/the_emirates_story.Etihadairlines.Home. (2009.aspx. Emirates Airline web site.incentivecentral. Internal Marketing Best Practice Study. and Readings in Cross-Border Management (4th Ed. Effective Internal Marketing for Improved External Marketing. et al. (2009). Bartlett.emirates. (2011).com http://WWW. October 19) airline safety and pilot training improvement act of 2009.org/pdf/internal_marketing_best_practices_study. (2012). Retrieved from http://www.pdf http://www.au/general-marketing/effective-internal-marketing-forimproved-external-marketing/#.org/wiki/Emirates_%28airline%29 Frank Mulhern. J.com Regional Airline Association > RAA. Retrieved from http://en. Emirates (airline). Retrieved from http://shiftfiles. 2012. 30th Mar. “The Airline Industry. (2004).” Web.Alarabiaairlines.com http://WWW. ROI.html http://WWW.N.emirates. Retrieved form http://www.org Costello. Retrieved from http://www. Don Schultz. (2012). Wikipedia. Northwestern University.com.lufthansa.wikipedia. Transnational Management: Text.

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