Marketing Strategy in the Midst of Stiff Competition of Domestic Airlines

Sun, 11 Jul 2010 at 20:09 Leave a comment

In domestic  routes, the Badan Pusat Statistik (BPS) recorded the number of passengers as many as 43.77 million people or 22.77% increase compared with the previous 35.65 million people.  This is caused by the addition of aircraft fleet and capacity on major Airlines. Also because of the increasing demand of air transportation services, as it is considered more efficient and economical.

As economic growth in Indonesia began to increased, the traffic movement of people has also increased. There is a new paradigm that occurred in the domestic Airline business: the demand will increase in line with the addition of supply. We see the example with the entry in Garuda Indonesia fleet of B738 and B739 in Lion Air, the Seat Load Factors of two fleets is not less than 75% or  number of passengers onboard is 150 passengers per flight in average.

In the midst of tough competition, where nearly all the Major Airlines upgrading its fleet into large and sophisticated Aircraft to fly over the main routes. The strategy to survive of  this “Clash of the Titans”, is finding a market niche, looking unspotted but potential routes.

This unspotted but potential routes is a major route connecting the city with the cities of the developing suburbs. Some of the routes fact does not require huge investment, because of the limited runway on some city, then that could be used is a narrow body jet aircraft.

Some of potential routes could be considered are : Banjarmasin – Bandung VV, Banjarmasin – Solo VV, Balikpapan – Semarang VV, Balikpapan – Solo VV, Balikpapan – Bandung VV, Makassar – Bandung VV, Makassar – Semarang VV, Sampit – Semarang VV. And many other unspotted but potential routes.

Other strategy is “jetizing” existing commuter routes, use proper Jet aircraft fly the routes that usually fly by propeller aircrafts. This facts also requires the Jet Aircraft able to Take-Off and Landing on runways less than 1800 meters.

Commuter Aircraft fleet, used as feeder for Jet Aircraft fleet. The rotation diagram of the fleet must be inextricably interwoven.

To implement the above strategy to succeed, at least there are seven steps that must be followed:

1. Evaluate resources, goals, and objectives.

First things the Key Management may do is evaluating the business plan, determining a new paradigm, new goals, and new objectives, if necessary.

2. Identify market demand and market-segment opportunities.

Perform a complete market analysis of those “unspotted but potential routes”, dig deeper, look for hidden opportunities.

3. Match resources to selected market niche.

Start browsing the proper aircraft fleet required to fly over those routes, create the aircraft rotation diagram  match with the results of the demands.

4. Establish a marketing organization and strategy.

Setup a District and place a right person to be a District Manager who able to implement the marketing strategies established by head office.

5. Select intervention and penetration level.

Selecting intervention and penetration level must carried by all divisions and all levels. It is important to gather all resources from all division to focus on the goals that already determined. Team work is not just about coordination, more than that, is about one paradigm for all divisions and all levels of management.

6. Develop a long-range marketing plan.

This step is about how we maintain and improve the achievement.

7. Implement, monitor feedback, and respond.

As soon as market established, anticipate the new (coming) competition in the route that we pioneered.


Entry filed under: Aviation Business. Tags: , , , , , , , , , , , , , , , , , , .

Knowledge about the Nature of Aviation Services Merpati Nusantara Airlines “Tempo Doeloe”

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