In today’s highly competitive business market, organizations need to set their marketing strategies in order to achieve their target. Marketing is an organizational function or processes of selling a product or service. It is essential for them to communicate properly with all their consumers. They need to manage their relationship with them. This report presents the marketing plan of Etihad Airways. It was established in July 2003 as the international carrier of United Arab Emirates. They operate more than 100 flights per week and 96 passengers as well. The main objective of company is to provide excellent experience of travelling to all their customers. They need to maintain good working culture in their company in order to gain high market share (Ferrell and Hartline, 2012). There are several strength and weaknesses of the organization and the main strength of the company is its strong brand image. It is essential to overcome with all the weaknesses and for this purpose Etihad airways several future strategies. The firm’s internal attributes can be classified as strengths and weaknesses and external environment presents opportunities and threats. Selected marketing strategies can be defined with the concept of marketing mix decisions (4 P’s) of product, price, place and promotion.
An Etihad airline is the flag carrier airline of the United Arab Emirates and it is based on the Abu Dhabi. An Etihad airway is the one international airport which operates more than 1200 flights per week to over 70 destinations. They are offering several products and services to their customers in order to achieve their target. They have offer cargo products and charter services. It is the fourth largest airline in the United Arab Emirates. They are the one who wins the air transport world’s passenger service award for 2012. They provide either two-class or three-class service on its flights. There are different class of services which are provided to all their consumers according to their class and status. These services are diamond first class, pearl business class, coral economy class etc. Diamond first class service is available on long-haul flights (Bradley, 2005). In this class they provide first class personal cabin for each guest and it is completed with providing sliding doors for maximum privacy. Pearl class business passengers can enjoy fully lie-flat seats and personal video screens on all aircraft. There is an extra facility for coral economy class passengers. They can enjoy complementary meals and personal on demand entertainment systems. The main business of the company is to fulfill the requirements of all their passengers. They also provide different facility to all their economy class members as well. So that all the people who belongs to economy class can also enjoy all the services of airline. Etihad Airways operates in tourism industry through their holidays and operate in cargo. They operate under the terms of product share and they have 60% international transportation of passenger. There are lot more expectations of the company from their passengers as they are providing them different services (Dibb, Stern and Wensley, 2002). They are expecting more profit and revenues in term of its international transportation of business.
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LO3 SITUATION ANALYSIS
Goals: In today’s competitive environment each and every organization need to adopt several strategies in order to achieve their goals. Etihad airways focus on the brand and quality of services.They have their short term as well as long term goals. Short term goals of the company are the key issues that company need to accomplish by mid 2011 and the long term objectives can be achieved by the next three or four years. In order to accomplish long term goals firm need to set their future strategies (O'Shannassy, 2008).
Short term goals: Etihad airways need to maintain their customer values even while decreasing cost. They also need to maintain their brand image by providing luxuries services to all their consumers.
Long term goals: Company should not only be profitable every year and also profit should increase by 5-10%.
The main focus of the company is to providing all the luxuries services to all its passengers and increase their customer value and satisfaction. The airline can do by decreasing cost ans simultaneously increasing yield. The main focus of the company is to creating inbound holidays to Abu Dhabi by 2030.
Culture: The unique culture and heritage of Abu Dhabi determines across the emirates. The main aim of the company is to deliver every best and possible service to its consumers. In order to support this they have created a business rich in culture diversity. All the employees work in this organization work with full commitment. They have set an environment and very good working culture of the company. People works in Etihad airlines with full of energy, creativity and team work together in harmony to achieve their goals. There are several opportunities for all their employees (Pride and Ferrell, 2008). With good working culture organization will become the part of the world’s fastest growing airline.
Strength and weaknesses: Domestic market, experienced business unit, high profitability and revenue, existing distribution and sales networks are some of the major strength of the company which helps them to achieve their target. Etihad airways can easily accomplish all their objectives. There are some weaknesses of the company are further increasing future competition, small business unit, costs etc. Some consumer’s complaint about longer waiting time in connection flights and it is the major weakness of the company. Etihad airways increased their seating capacity every year and they have globally recognized sponsorship with sports club and events.
Market Share: Etihad airways are the national airline of the United Arab Emirates. The main objective of the company is to attain their long term and short goals. Company can easily gain their market share with the help of providing first class services to its entire consumer. It is the world’s largest international carrier and operator of the world’s largest commercial aircraft. They can gain their market share with the providing help to all their employees from more than 120 different nationalities (Wedel and Kamakura, 2000). The organization not only maintains but also improved its service level to customers.
It is the part of microenvironment which mainly focuses on the buyer behavior. The organization has many international airports but the main region carrier is Abu Dhabi. All the target customers of Etihad airways are the passengers who travel from Abu Dhabi international airport. The main objective of the company is to provide luxurious services to their entire passenger. In order to attract their customers company has set various strategies. The tagline of airline is “From Abu Dhabi to World” currently focuses on outbound holidays. The current target segments of the company are the tourist and business people. Company focuses on their pricing strategy as well as their middle class and higher class sector. The target customers of the company are those people who want to travel with luxury and high standards of hospitality. They need to increase the number of their consumers and for this purpose they need to segment their customers (Shaw, 2012). All the passengers are segmented into tourist, personal, religious, business. Abu Dhabi is rapidly developing region in the terms of business and tourism both. There is a high range of increment in the tourist arrivals. The value of any product is the psychological belief the customers create about a certain product brand. Customers will easily obtain the benefits of all the products and services given by the organization. There is an functional benefit of product which is determined such as Etihad airways delivers to the customers.
There are several competitors of the Etihad airways such as Emirates airlines, Air Arabia etc. The opponent of this airline not only includes U.A.E. Based airlines but also includes Qatar airways, Oman air etc. Emirates airline is one of the strategic benchmark company which is the biggest rival of Etihad. It is famous because of its low cost marketing strategy. Due o advancement in technologies such as video conferencing etc people do not need to travel in different countries for the business purpose. All the telecom companies are the biggest threat for Etihad airline. Emirates have its more customer values. Customers would get the values in terms of monetary price as the airline of Air Arabia is much cheaper that Etihad airway. In order to gain their market share organization need to fulfill all the requirements to their consumers. Etihad airways provide several distinct services and products to their passengers which helps them to improving their productivity (Wedel and Kamakura, 2000). With the help of satisfy customers company can gain their market share. There is several strength and weaknesses of the firm which need to be resolve in order to compete with its rivals.
An Etihad airway is the flag carrier airline and it is the national carrier of United Arab Emirates. It is a distribution industry and today it is considered as one of the most rapid growing airline. They mainly work with the strategy to provide their guests with an incredible travel experience with its excellent services for business class, economy class and first class cabins. They operate more than 1000 flights per week to 96 passenger and cargo destinations. They will give various rights and privileges by the government for international operations. The capital of the United Arab Emirates, Abu Dhabi is Etihad airways base and hub. This airline operates with the help of different travel agents who are their general sales agents. They have last year carried only 26% of the total number of passenger transported by Emirates. This industry is well known among all the people because of its quality cabin crew services. These services are provided to all its customers. The airline operates in various destinations and provides various online services (Bradley, 2005). All the corporate activity of the organization is controlled by the head office of Abu Dhabi international airport. The company is administrating by the board of directors. The organization has its partnership agreement with other airline companies. These will promote all the company’s operations including its marketing strategy.
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LO5 PESTLE ANALYSIS
There are various factors of macro-environmental factors that directly effects the decision making process in the organization. These factors can easily determine with the help of PESTLE analysis. It gives the total description about political, economical, social, technological, environmental and legal factors. Political situation in Emirates gives a competitive advantage to UAE companies. They can attain higher competitive advantage because of the political stability in this region in comparison with other Arabic countries. Etihad is based in the Abu Dhabi which is one of the developing cities (Ferrell and Hartline, 2012). The growth of Abu Dhabi’s economy is higher and it is one of the best parts for business class people. The main competitive advantage of the firm can be determined such as benefit from a low tax regime and lower costs in domestic airports. The currency cost of the UAE is associated with the US dollar. It is the base of cost advantages over the UE rivals. The company has their lower exchange values according to its legal factors. The political factors can be described with the relatively liberal government of country and it is mainly depends on the support of sheikh. Economical factors provide the cheaper cost at domestic airport as well as high external and low internal fuel prices. Social factors in Emirates give cosmopolitan workforce and population. Abu Dhabi is one of the developing city and the environmental factors of the company represents the sound and other restrictions in urban areas (Lamb, Hair and McDanial, 2008). Etihad have started their online services through which they can easily gain their market share. It is totally depends on the technological development of the country.
LO6 SWOT ANALYSIS
An Etihad airway is a national carrier of United Arab Emirates and today it is considered as one of the most rapid growing airline industry. They always try to promote Abu Dhabi as an attractive business centre as it is the primary focus of the company. Company need to promote their different services in order to achieve their target. It is essential for them to set several future strategies, so that they can easily compete with their rivals (Shaw, 2012). A SWOT analysis can be performed with its strengths, weaknesses, opportunities and threats. These are as follows:
- The CEO of the company James Hogan is very experienced and they have highly qualified management team. It is the necessary part of the company in order to achieve the success.
- Etihad have their unique designs of cabins and also for their different services such as diamond zone for first class, coral zone for economy class, pearl zone for business class. It is the major strength of the company which helps them to attract several customers and achieve their target.
- The main strength of the company is its strong brand name (Koh and Boo, 2004). They have their tagline “From Abu Dhabi to World” it have high impact on all its consumers.
- Low corporation taxes and increased seating capacity every year.
- It is the globally recognized sponsorship with sports club and events.
- They have adopted the strategy of partnership which is very successful for them as the partnership with Virgin Blue Australia. They have added the new dimensions and provide high service quality.
- Their capital interest charges and high cost of business start up is the major weakness of the company.
- They have fewer destinations than major competitors such as Emirates have more than a hundred destinations.
- They never use to manage their customer service centers appropriately. Many passengers complaint that they didn’t get the help they needed.
- Longer waiting time in connection flights.
- Entrance into new markets is also allowed due to strong brand image (Crystal, 2010). There are several further opportunities which help the firm to increase their market share.
- Growing ground services and partnership with other airlines
- Abu Dhabi is one of the most promising business districts in the Middle East and it will attract more and more business travelers.
- Due to innovations in cabins there is a good chance to attract technology loving customers.
- The biggest threat for the company is shortage of trained and qualified staff. This will lead to decrease the performance of industry.
- Entrants of new rivals into the market
- Fuel cost may be increases
- Natural environmental conditions also affect the aviation industry
- Terrorist’s threats towards airlines.
LO7 Market Segmentation
In the difference of few years the business of Etihad Airways has been rise to peak due to its marketing strategies. Few years back they were at small business in Abu Dhabi. They worked at the local level, but with including the different strategies in business they are now worldwide. They were having a competition in market with Qatar Airways and Emirate airways. They were called as “middle east big three” (MEB3). As the Etihad Airways is Airline Company. There are many strategies which are used by the Etihad Airways to get the growth in the market of airline companies they had many competitors in the market which were from long time. But now they had got the respective position in the market and successfully giving their services to the world. The strategies which are used by the Etihad Airways are:
There huge size aircrafts: They are having the large size international aircrafts that is the world’s largest operators of the commercial aircrafts. In their annual report they have 39million 237 billion available seats kilometers. They have large number of passenger who is using the services of them. They are having numbers of airbus A380. Initially they have around 30 A380 in their stocks and they are planning to purchase 30 more. It has carried around 26% of total number of passenger transported by the Emirates (Pride and Ferrell, 2008). They had reduced the cost but they maintain the customer value. As they had decrees the cost they but they do not compromise with its luxurious brand. They give same services after the decreasing the cost. They do not have a profit business every year but they manage to increase profit rate every year. They had got the customer value and satisfaction every year. As compare to others they had large size aircraft.
Partnership with different companies of airlines: Etihad airways had partnership with different airlines in the world. Today it has around 45 airlines worldwide. They are creating a virtual network between these companies to get the services in less capital. A similar networking has done by different companies so get the benefits. This strategy allows them to get own alliance. It’s get easier to them to raise their business through their business in one on one partnership.
Equity tie-ups: They had developed their first partnership Air Berlin in December 2011. This partnership was carried out at time when Air Berlin was struggling with the financial condition this partnership also gives them a support their business. They both had different conditions in between them to work. Etihad had more partnership in with different airlines. This is the best example of Etihad to produce the different airlines. This takes to the success of the both company.
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LO8 Alternative marketing strategies
There are different alternative marketing strategies used by the Etihad Airways that helps in generating the growth in the sale of the products. As it has partnership with different airlines companies which help them to maintain the cost of the travelling. That creates a virtual network in between the companies which help in reduced use of resources. In that they had developed their first partnership Air Berlin in December 2011. This partnership was carried out at time when Air Berlin was struggling with the financial condition this partnership also gives them a support their business (O'Shannassy, 2008). They has another tie-up with low range company this show the interest of the Etihad airways in both type of company. They had change in the rate of their tickets. They lower down its products values so that customer can get to them more frequently. They had good and qualified staff in their Airline that will give more satisfaction to the customer and they make many changes the facilities which they are providing earlier. In that they give road transport services in the form of car and coaches. They provide medical information to aware the people. The children above the age of 5 and below the age 12 can travel easily with them they can get full support and attention from the staff. They give 24 hour advance check in limited cities so this will reduce the crowd at the check in counter.
LO9 Selected marketing strategies
- Products strategies: Etihad Airways has different products for their customer to satisfy them. For this they had large aircraft with different types of facilities in it. They give full possible pleasure to their customer. This also leads to developing their brand values. The product which are provide by them are much standard as compare to other flights in the market.
- Price strategy: They had different market strategies to implement their price strategies. Some services are same as Emirates Airlines and British Airlines are producing but the services that provide by the etched are at much low price as compare to others. But low prices can create problems so they should increase their price with few percent so that they can come in the categories of Emirates and British airlines because due to low price people count those in low brand this can affect their brand value.
- Place: In place strategies the main problem comes in the format of ticket distribution. Customer did not want to go to their main office to collect the tickets so they had tie-up with different agencies that can provide the tickets to their customer. This gets easier to customer to collect the ticket (Worthington and Britton, 2009). On their official website customer can collect the ticket from there. For the satisfaction of the customer they had a customer service call center where all the problem of the customer has solve. It can be about the reservation, booking and time of flight. This type of facilities gives customer more satisfaction they need not to go to their counter.
- Promotions: The promotions are the main factor through which the customer can get able to know the different strategies of the company. So for this they had many policies with the help of which they can give the information about the company policies. This will helps the customer can get the benefits of that policies.
- Sale promotions: For the promotions of the sale Etihad have many different polices which helps the customer to get an advantage of it. They provide different coupons and bundle offer to their customer so that they can make use of the give fare. They also provide the ticket at low rate as compare to the different sales agent.
- Direct marketing: For direct marketing they had different employee who can gives the information of airline to the customer (Leonidou and Leonidou, 2011). This helps the customer to get to know about the required information. So for this they had taken different parts in the event and the exhibitions.
- Sponsorship: They have different sponsorships in different field which helps them in promoting their business. They had a sponsorship of F1Etihad Airways Abu Dhabi Grand Prix, F1 Ferrari team, Abu Dhabi Golf championship and Gaelic Athletic association.
- Advertisement: This can be done with the help ho media channels with the help of different means of media like T.V., radio, magazines and newspaper. These help them to send their information to different places at the same time. So with the help of this they are able to get aware the people about their company’s policies.
LO10 Short and long term projection
Short term projections: There are different objective which is taken by the Etihad Airways to get the projection in the market. Decrease the cost of the tickets this takes attention of the customer. They started taking use of their facilities as they get this service in other Airways at much higher rate. So they started taking high revenue on the flight of the long distance, the ticket of the diamond class and the sector where more people travel in regular basis. They maintain the luxurious brand value of the company which also helps them to maintain the brand value in the market (Bradley, 2005). The low costing of their product did not lower down the priorities of the customer. They get the same services that were as before.
Long term projections: In the long term projection they had maintain the profit rate in the increasing order every year so that they able to get growth in the company’s position in the market. As they maintain the customer satisfaction they also keep it in increasing manner so that the customer can get different changes in the flight every year. They are giving different coupons and bundle offer to the customer for the stay in Abu Dhabi which gives more attention of the customer. That gives rise to sale of the ticket.
From the above report it is concluded that in today’s competitive environment it is essential to set various marketing strategies in order to achieve the goal of the company. Etihad Airways need to provide airline carrier services to all its customers globally. It is essential for the company to meet all the expectations of the consumers. Customers who have experienced this services they guarantees for the standards set by the airlines. The current strategy of the company is having fewer destinations than its competitors. It gives the total description for choosing target markets through market analysis, as well as understanding consumer buying behavior and providing superior customer value.
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