2. SPICEJET
• Parent company : spice jet
• Category : Indian domestic sector
• Sector : airlines
• Tagline/slogan: flying for everyone
• Usp: lowest price
• Segment: cost conscious passengers
• Target: lower middle class/ middle
class
• Positioning : low cost no frills
3. INTRODUCTION
• Spice jet is a low-cost airline based in New Delhi.
• It began service in 23 May 2005.
• Spice Jet was earlier known as Royal Airway
• The director of this airlines is Mr. Ajay Singh.
• This airline has more than 2500 employees working with them
currently.
• SpiceJet names all its aircraft after various spices and herbs like
Cinnamon, Thyme, Oregano.
4. Swot analysis
STRENGTH
• Entered with RS 99 fares for the
first 99 days
• Strong backing by the promoters
• Having more than 35
destinations in India
• Good presence in the market due
to its branding and advertising
5. SWOT
WEAKNESS
• Low market share due to
presence of significant
competition
• no international
destinations
• Dependency on leased
assets
• Small load deficiency
compared with competitors
OPPORTUNITIES
• Growing population for
• demographics
• growing interest on tourism
• Growing aviation market
• International tie ups would
boost brand image
• Tax holiday on aircraft
leasing– The Union Budget
Government of India
announced 5year tax holiday
on aircraft leasing.
8. SWOT
ANALYSIS
STRENGTH
• One of the largest low cost
carrier
• Only LCC to make consistent
profit
• Has entered international
markets and boosted its
brand value
• Increased brand recall due to
goodmarketing and
advertising
WEAKNESS
• Not on too many routes
compared to competitors
• Still has to establish itself
on international
destinations
• Concentrate only on middle
class society
• Customers are not happy
with Inflight services
9. OPPORTUNITITES
• Attracted loyal customers
and converted them into
indigo flyers
• Opportunity to go abroad
markets
• Rapid expansion by buying
new airbuses
• International tie-ups would
boost the image of indigo
THREATS
• Strong competition in the
LCC segment
• Rising fuel cost
• Changing government
policies
• Companies are cutting air
travels due to economic
crises
10.
11. STRENGTH
• 1. Has created a good image
among Indian fliers
2. Strong backing from
promoters
• 3. Awarded as one of the most
premium domestic airlines in
India
• 4. More than 1 million
passengers catered in a year
• 5. Exclusive and premium
advertising and sponsorship give
it a high brand recall
• 6. It has flights to 25 Indian
destinations and international
flights as well
WEAKNESS
• 1. Financial issues due to
Heavy Debt
• 2. Laying off employees
caused a bad image
12. OPPORTUNITIES
• 1. Reputation of providing
the best amenities in Indian
skies
• 2. Financial stability can
improve operations
• 3. More domestic and
international destinations
THREATS
1. LCCs eating up the market
share
2. Rising Fuel Costs
3. Pressure from aviation
committees and govt
policies
13. strength
• Strong backing by the
promoters
• Nearly 1000 flights per
week
• Covers almost all major
cities
• Good branding and
marketing in India
weakness
• market share is very less
• It entered Indian market
very late
• Not too many destinations
compared with its
competitor
14. OPPORTUNITIES
• More destinations yet to be
covered
• Global operations can also
be a value addition
THREATS
• Plenty of new LCC’s to
compete with who already
have taken the lead
• Rising labour costs
• Rising fuel costs
17. CUSTOMER ANALYSIS
• SEGMENTATION
Geographic : tier I and tier II cities
Target : premium class of train travellers
business people
corporate employees
Psychographic
Segmentation : aiming for higher life style
• UNMET NEEDS
More international destinations
Need for technological advancement
Need for trained cabin crews
20. ENVIRONMENTAL ANALYSIS
PEST
POLITICAL FACTORS :
• Bureaucracy
• No clear policies for state carriers
ECONOMIC FACTORS:
• increasing tax and tariff
• Price depends upon individual firm’s behaviour
• International fuel price
21. PEST .. (CONT)
SOCIAL FACTORS :
• Lack of skilled manpower ( in flight staffs)
• Customers services
• Safety concerns (9/11)
TECHNOLOGICAL FACTORS :
• Night landing facilities
• Operation during winter
• Capital intensive technology
22. MARKET AND SUBMARKET ANALYSIS
• MARKET : aviation industry
• SUB MARKET : low cost carriers ( LCC’S)
• SIZE AND GROWTH : 14 % of market share
• MARKET ATTRACTIVENESS : fast
transportation
23. MARKET TRENDS ( EMERGING
MARKET)
India’s fastest growing tourism destination (majordemand
driver)
• economic growth
• growth in business travels
Low cost carriers ( Lcc’s)
• Resulted in middle income people people and self employed
shifting from premium class travel in trains to air travel
• Domestic air passengers grew at a 38.5% from 25 %
• CAPA predicts that domestic traffic would increase from 25%
to 30%
24. CUSTOMER PROFITABILITY
• Focusing towards enhancing the customer experience
• Complimentary supervision of unaccompanied minors
• Hot beverage and combo meals available for sale
• Waiver on additional charges on sport kits
Reaching out to business travellers :
1. business travellers can collect their boarding passes on
the same day return flight.
2. introduction of corporate travel programs
3. free two piece baggage
25. Key success factors
• Low cost carrier
• Point to point services
• Cheaper product design
• Sales via internet
• Word of mouth marketing
26. CUSTOMER SERVICES
• personal wallet at airport
• Personal and exclusive baggies
• Refreshment and music
• Three course meal
• Baggage assistance
27. Promotional tools
• Word of mouth marketing
• Print ads in newspapers
• TV commercials
• Internet media initiatives
• Hoardings in railways, platforms, airports
and shopping malls
28. COST AND VALUE DRIVERS
(COMPETATIVE ADVANTAGE)
HIGH SEAT DENSITY :
• Single class 189 seats per flight
• Focus on maximum space utilization for generating
more revenue per flight
DIRECT DISTRIBUTION OF TICKETS :
• Sells its ticket via internet or call centres
HIGH CRAFT UTILIZATION:
• consistently reporting high aircraft utilization
29. Strategic uncertainty
• Uncertainty in forecasting the future
• Market fluctuations
• Rapidly changing clients
How to over come ?
• Government should develop and promote
policies
30. SCENARIO ANALYSIS
• control of emission level
• Risk of high-jacks
• Increasing fuel price
• Decreasing rupee value
How to overcome ?
• Increase security level
• Fuel hedging
