3. BRAND OVERVIEW
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KINGFISHER
Airlines
owners - United Breweries Group, Bengaluru
established- 2003 > commercial operations- 2005; international- 2008
not shown profit in any financial year
merged with Air Deccan in 2007
• Air Deccan > Kingfisher Red : low cost carrier
potentially India’s 5th largest passenger airline
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SKYTRAX five star rating
• One of the six in the world
• Only Indian airline
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2010 | 2nd largest market share > financial issues > 2011 | lowest market share
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“Oneworld” airline alliance
• was set to join in Feb 2012 - now it has been put off
5. MARKET SCENARIO
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KINGFISHER
Airlines
steady growth of the Indian economy after liberalisation
demands for both business and leisure travel
emergence of a new Indian middle class
travellers and per capita use of airline services in China - eight times
2003: entry of new players into the airline industry
• several costs of operating an airline were fixed
• irrespective of business model - at times as high as 80%
• most of the new entrants chose to use low fares as their weapon
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more than 5crore air travellers in India
around 3.8crore as repeat travellers
air‐passenger strength in India is expected to grow at 12% per annum
Source : www.dgca.nic.in
6. COMPETITIVE POSITIONING
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Damania - luxury airline with on‐board entertainment
EastWest – biggest fleet
Jet - punctuality and good service
Sahara - excellent connectivity
Modiluft - safe and reliable airline
Air India – reliable and economic with wide reach
Air Deccan – low cost
IndiGo – budget airline
GoAir – low fare carrier
Paramount – niche reach
MDLR – connectivity
Kingfisher – initially ‘stylish flying’
- after merger with AirDeccan: ??
KINGFISHER
Airlines
8. WHAT WENT WRONG?
KINGFISHER
Airlines
• Acquisitive excess
• acquisition of beverage companies, newspapers, magazines, football teams,
cricket teams, Formula one teams etc.
• scattered brand identity
• seen as an ever expanding brand with no specialisation
• profits made from other ventures used to support KF Airlines’ ambitions
• External factors
• Deregulation of the aviation industry
• price range very competitive
• also, compared to global air-fares, Indian rates were very low already
• 2008 global economic crisis
• air passengers went economical
• fuel prices shot up | value of rupee suffered
9. WHAT WENT WRONG?
KINGFISHER
Airlines
• Brand injuries on the public front
• Ambiguity in media about brand during crisis
• no or delayed statements from the company increased doubts
• bad ‘W-O-M’ on social media websites
• brand cannibalisation between parent brand and KF Red
• if both brands look similar, fliers would go for cheaper option
• poor service during crisis period
• customers suffered at terminals on airports
• in-flight service became poor
• Faulty model
• management woes |no exclusive management architecture
• no heed to unnecessary costs that could be reduced
• bad choice of service terminals at airports | bad choice of carriers
10. WHAT WENT WRONG?
KINGFISHER
Airlines
• Merger with Air Deccan: Before v/s After
• Before merger, promised a glamourous first class service - unusual among
the domestic airlines
• several unique offerings (IFE, special meals, exclusive staff, etc.)
• admired service - corporate sector wanted all top executives to fly KF
• Air Deccan was for the “aam aadmi”, a sort of shuttle service
• a near-opposite model
• forced to fly to tier-II cities at low costs
• after acquisition, a confused value offering
• struggle with upgrading Air Deccan operations into KFA template
• overflowing costs + mismanaged dual identities
• took on the international market without consolidating the domestic front
• international market has more competition
• requires deeper pockets
13. Recommended Changes
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KINGFISHER
Airlines
Re-structuring of management
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exclusive management for KFA
clear demarcation of offerings between KF parent and KF-Red flights*
Communications : Clear brand image of a committed player
KFA should be seen as a corporate entity, not a pet-project
• Given the performance of Kingfisher before and after the merger, it can be
repositioned as
Option I – Act as a niche brand, catering to the executive class
Option II – Cater to all classes – executive and economical
15. KINGFISHER AS A NICHE PLAYER
KINGFISHER
Airlines
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Kingfisher Airlines had been doing initially well as a ‘luxury’ brand
if the company doesn’t want to operate in tier II cities it could also choose to be
identified as a niche brand it earlier was
price its service higher and continue the existing fleet
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Existing brand offerings that will be highlighted in branding
fleet of brand new Airbus - A320’s
glamorous flying : new aircrafts | stylish red interiors | stylishly dressed cabin crew
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in-flight entertainment (IFE) systems
• even in domestic flights
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several unique services
• personal valet at the airport to assist in baggage handling and boarding
• exclusive lounges with private space
• refreshments and music at the airport
• audio and video on-demand - with extra-wide personalized screens in the aircraft
• sleeper seats with extendable footrests
• three-course gourmet cuisine
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17. KINGFISHER ACROSS ECONOMIC SEGMENTS
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Promise only what it can deliver
KINGFISHER
Airlines
should be identified as a player with focus on ‘quality’ and not just ‘luxury’
reduce in-flight luxuries | increase efficiencies like turnaround time
optimally choose service terminals at airports – depending on flights
all communications about the brand should aim to clearly demarcate between
the two KFA brands
• differentiation of services should be clear to create separate identities
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Adopt more cost-efficient carriers
• Routine routes : Dreamliner 787 instead of Airbus A380
• unit cost of $193mn instead of $376mn
• larger wingspan | more fuel efficient | higher cruising speed
• Lighter routes : Bombardier Q400 or Comac C919
• low seating capacity as required
• equivalent to standard ATR, Boeing and Airbus carriers
• used by SpiceJet
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Decision on routes to fly
18. KINGFISHER ACROSS ECONOMIC SEGMENTS
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Holiday packages
• for unprofitable routes like Nasik and Aurangabad
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Other packages
• tie ups with corporate houses
• more efficient frequent-flyer program
• surprise in-flight offerings to retain customers
KINGFISHER
Airlines
20. KINGFISHER
Recommended Changes
Airlines
Targeted Brand Identity Prism
Physical
• Same vibrant colours
• Logo facing ’upward’
instead of downward
• Textual distinction of
brand by its service
Relationship
• Comfortable flying
partner
• Meets all standard
expectations
• Flyers should not
worry about travel
Reflected Customer
• New age travellers
• Ever expanding
market and demands
Personality
• Global standard of
service
• Setting the bar for
other brands
• Quality oriented
• Trustworthy
Culture
• Commitment
• Quality
• Fair value for
invested money and
choice
Self Image
• Committed
• Organised
• Customer oriented
• Optimum use of
resources
