Services
As demonstrated throughout this business plan, it is clear that a strong growth potential exists for the future, and the airline will gear itself toward sensible, well-based growth and solid financial and business planning.The proposed new airline has the potential to become a strong, well-established, and - as the numbers indicate - extremely profitable carrier, starting from now.
3.1 Service Description
In reviewing the planned services to be offered by the proposed new airline, this plan will divide services into two main categories: passenger services and cargo services. Within each category, the service strategy, as well as general services to be offered, are presented and reviewed.3.2 Competitive Comparison
In comparing the proposed new airline to its competitors, there are at least two levels of comparison that must be considered; the usually lower-standard airlines, both scheduled and charter, flying out of the Southeastern European region, and the higher-standard, more highly regarded airlines operating out of Western Europe.Beating the former source of competition is both a reasonable and an essential goal. But comparing favorably, and even standing notably above, the latter also is an important objective since these airlines will represent direct competition to the new airline on many of its projected key routes, despite efforts to avoid such competition to the extent feasible.
Fortunately, several of the key distinguishing characteristics planned for the new carrier not only will enable it to fare extremely well in both levels of competitive comparison, but will actually be achievable at a savings in cost and resources. In other words, by being smart, the new airline can be significantly better than its competition while at the same time accruing lower overall costs, a remarkably good combination.
In comparing the proposed new carrier to both its Southeastern European and its Western European competition, it is important to look at those factors that determine how most travelers choose an airline. They include the following (and the order of importance is different for each traveler and each situation, but the most important factors are listed):
- Safety, actual and perceived;
- Cost, and range of fares offered;
- Destinations served;
- Availability of seats;
- Availability of fares;
- Convenience of flight schedules, times of arrivals and departures;
- Frequency of flights;
- Connections, including reliability and convenience of connections;
- Nature of flights: non-stop, direct, number of stops, aircraft changes;
- Availability of different classes of service;
- Onboard comfort, service, meals, and amenities;
- Type of aircraft, including jet or non-jet, size, and speed;
- Age and condition of aircraft;
- Ease and efficiency of reservations and ticketing;
- Reliability and on-time departures and arrivals;
- Ground service;
- Reliability and quality of baggage handling;
- Friendly, competent service in reservations, check-in, and in the air;
- Overall reputation of airline;
- Nationality of carrier;
- Factors of personal preference.
Both in the overall design of the airline and its basic operational features, as well as in its management, quality control, and day-to-day operations, the proposed airline is expected to stand out positively in almost every regard.
Competition with Southeastern European carriers
While not all Southeastern European carriers fit the stereotype presented here, and several are in the process of privatization and ostensible upgrading, most do operate at a lower level of service than is customary in Western Europe.
It is not uncommon for carriers in the region to operate older Soviet-built equipment (perceived to be less comfortable, less safe, and less reliable than its Western competition - perceptions that often are accurate).
For instance, such competing airlines as Avioimpex of the Former Yugoslav Republic of Macedonia, Albanian Airlines (Albania's Kuwaiti-owned private carrier), ADA Air (a smaller private carrier in Albania with which BalkConsort has been partnered for certain purposes), Hemus Air and Bulgarian Airlines, both of Bulgaria, Tarom, Romania's state carrier, and even Malev, the Hungarian airline, still operate Soviet-era aircraft in their fleets. In some cases, these aircraft are turbo-prop powered, and not pure jet.
While often it is relatively inexpensive to lease such aircraft, their operating costs tend to be significantly higher than newer, more fuel-efficient Western-built aircraft, and their safety, reliability, and noise factors are often poor, in some cases limiting their ability to operate in some markets.
Service levels are poor in general, among both scheduled and charter carriers, which represent a significant part of the market, particularly in service to Kosovo and Turkey, the two niche markets identified for the new carrier.
By utilizing modern, safe, reliable, and cost-effective Western-built regional jet aircraft, the proposed new airline will offer a far more attractive alternative to the traveler both from within and outside Southeast Europe, and will be able to operate with far lower fuel and maintenance costs than the competition.
The comfort, reliability, speed, and safety of the new airline's aircraft all will enable it to be the airline of preference for virtually all business, government, and organizational travelers from both within and outside the target region when traveling to or within the region, and it also will be preferred by most leisure and personal travelers, including those from with the target region, as well.
Greater reliability and punctuality of the aircraft, augmented by state-of-the-art navigational devices that permit operation under a wider range of weather and visibility conditions, will enable the airline to compete most favorably on those bases also, and will ensure the least likelihood of flight cancellations, postponements, and missed or late connections.
On the basis of fares, the new airline will offer highly competitive fares which, in many cases, should be below those offered by its Southeastern European competition. Higher load factors, combined with greater efficiency both in operational costs as well as in reservations, ticketing, and check-in, will enable the new airline to be highly competitive from both a cost and a quality perspective, and will also enable it to retain a higher percentage of its revenues.
In short, the local competition, except in a few cases (such as Aegean/Cronus Airlines, and to a lesser extent Olympic Airways, from Greece; Adria from Slovenia; in some cases Malev, from Hungary; and the Turkish carriers) will not represent very strong competition to the new airline, and particularly in attracting the primary market groups at which the new carrier will be aimed.
Finally, the new carrier will be seeking out, as part of its business and marketing strategies, routes and city pairs that offer unserved or under-served demand. That strategy also will help reduce the threat from competition, and will enable the carrier to further establish itself as the carrier of choice in Southeast Europe.
Competition with Western European carriers
The competitive picture is somewhat different when Western European carriers represent the competition. Many of the new airline's competitive advantages relative to Southeastern European carriers are erased or at least minimized.
In most cases, the new airline will be competing with other carriers operating aircraft of a similar nature. Safety, comfort, convenience, and reliability, as well as in many cases cost, all are on a similar footing. To stand out from the crowd, the airline must do things either differently or better, or both, than its competitors, and it is here that both the design and the management of the new airline must be at their sharpest.
The competition in this region will include such well-established carriers as Swiss International, Austrian, Tyrolean, Lufthansa, KLM, British Airways, Air France, Alitalia, Sabena, and others of that nature. More recent, lower-cost, and "hipper" start-ups such as EasyJet, Go Fly, Bluebird, Virgin Express, and others like them will represent even more challenging competition in some cases.
But unlike any of its competitors, which may employ one or two or several elements of the proposed new airline's marketing strategies, informational and electronic technologies, and management techniques, none of them - none - employ the full range of those elements that the proposed new airline will employ.
Consequently, the proposed new airline will be the real equivalent of a whole new generation of airline (regional or beyond), and will represent the kind of revolution in the aviation world that Pan Am, Icelandic, Laker Air, PEOPLExpress, Virgin Air Atlantic, EasyJet, and Air Blue represented in their day (and in some cases, their "day" is still today).
In that regard, the new airline might well be known as "TechnoAir" given its extensive deployment of state-of-the-art marketing, reservations, ticketing, check-in, baggage- and cargo-tracking, and operational and safety technologies.
The advantages of these technologies include a net cost saving to the airline, greater convenience and ease for the passenger, and an image and reputation that will cause the new airline to stand out from the pack. Combined with a staff and management that will be carefully recruited, selected, trained, and motivated to be the best of the best, and to be the most customer-oriented in the business, the new airline also will soon become known by its motto: "I've got a job to do, and I do it every day - for you!"
In other key areas - routes, schedules, and fares - the new airline also will be carefully designed to either compete highly effectively or, alternatively, to go where the competition is limited or non-existent.
Requirements for interline arrangements
In order for the new airline to be able to obtain the interline arrangements such as code-shares, interline fare agreements, frequent-flyer mileage sharing, and so forth, that will be so important to its competitive posture and overall success, it must:
- Fly Western-built aircraft, preferably pure jet.
- Meet the standards to have a two-letter airline code.
- Meet the highest standards for safety, reliability, and service.
- Be accessible through normal reservations and ticketing systems.
3.3 Fulfillment
The primary issue regarding sourcing is the question of the type and source of aircraft to be employed in the new airline's fleet.Aircraft selectionSeveral potential fleet aircraft and manufacturing sources are being considered and evaluated, including the following:
- Airbus Industrie ATR72, A-300, A-310, A-320
- Boeing 717, 737-500, 737-700
- Bombardier Canadair Regional Jet CRJ
- British Aerospace BAe 146-300, BAe 146-200QC*, Avro RJ85, RJ100, RJX85, RJX100
- Embraer ERJ-145
- Fokker 100
- Saab 2000
- Also, in an all-freighter configuration, the BAe 146-200QT** and BAe 146-300QT**
** QT = "Quiet Trader" all freight version, of which in service there are 13 in the 200 version and 10 in the 300 version.
With the exception of the turboprops ATR72 and the Saab 2000, all aircraft under consideration are pure jets.
Given the strong "jet preference" among the flying public (for instance, Continental Express in the U.S. estimated that its load factors increased 33 - 50 percent when it switched from turboprops to jet aircraft, and similar results have been documented elsewhere, including in Europe), the overall greater speed and reliability, reasonably close operating costs (especially given the additional flights that can be operated daily), and the longer range offered by jets, the preferred aircraft type is a pure jet. It remains only to decide which is the "right" pure jet for the fleet.
A number of key factors have mitigated toward the BAe Avro RJ family of regional jets rising toward the top of the list as the probable aircraft of choice for the new airline. Among those factors are the following:
- Relatively low per-seat acquisition cost.
- Relatively low per-passenger-mile costs, given their added capacity over smaller regional jets, and high reliability factors in the newer versions (for instance, Aegean/Cronus Airlines of Greece, which operates six RJ100s on a very active daily schedule, has averaged above 99.6 percent departure reliability with its RJ fleet).
- Complete pilot and maintenance intercompatibility between the various members of the family (RJ70, RJ85, RJ100, and now the new RJX family as well), giving added flexibility in flight and maintenance operations and reducing training and simulator costs.
- Four-engine configuration which gives it an added safety factor (while also increasing operating costs, however).
- Spacious, comfortable cabin interiors that offer the only seat, aisle, and overhead bin dimensions available in a regional jet that are equivalent to those on standard-size jets.
- The option of flexible cabin and seating configurations that allow for varying the number of seats provided for various classes depending on demand, the number of seats abreast, types of seat coverings, the number of seats provided on a given flight, and so forth.
- Availability of the aircraft from various sources on both lease and purchase bases.
- The possible option of obtaining advantageous British export financing.
- Ability to service the aircraft in many locations on the projected service network and the availability of major overhaul capabilities at the manufacturer's own facilities in the U.K.
- Widespread passenger and industry acceptance of the Avro regional jets both within and outside Europe.
In Europe, any airliner with 100 or more seats falls under the far more highly compensated "mainline" airliner contracts in place in the industry. Planes with 99 and fewer seats are considered "regional airliners" for contract and union purposes, carrying more economical compensation packages.
On the lower end of the spectrum, market conditions make it very difficult to run profitable operations in Europe with a 70-seat regional jet, which is considered suitable only for certain niche markets. Consequently, the core of the regional-jet segment in Europe falls in the range of 85-100 seats and, in fact, this segments comprises nearly half the airliners in use in Europe today. Either the RJ85/RJX85 or RJ100/RJX100 series (or older BAe 146) fall squarely into this size segment.
Either the RJ85/RJX85 or RJ100/RJX100 (the fuselage and cabin configurations are the same for both series, with the major change being in the more advanced and more powerful Honeywell AS977 engineers on the RJX series) is able to offer seating up to 99 seats (the 100 can offer a maximum of 112 seats configured with optional six-abreast seating), although the 85 series requires six-abreast seating to reach the upper capacity limit.
There are trade-offs with both series to consider: The 100 series offers greater capacity without the need to go to six-abreast seating and lower per-passenger-mile costs at higher capacities, but it also offers somewhat less range and requires a longer takeoff roll than the 85 series.
On the other hand, it also has more cargo capacity. The 100 series also obviously costs more to acquire than the 85 series, but with planned high load factors this capital cost should be more than offset by greater revenue potential. Key operating parameters for both the current and new series of Avro jets (85 and 100) are given here:
| Aircraft type | RJ85 | RJ100 | RJX85 | RJX100 |
| Seating | 85-100 | 99/100-112 | 85-100 | 99/100-112 |
| Cargo Capacity (m3/ft3) | 18.25/645 | 22.98/812 | 18.25/645 | 22.98/812 |
| Range (km/nm) | 2796/1510 | 2554/1379 | 3296/1780 | 3019/1630 |
| Maximum Speed (kt) | MO.73/300 kt | MO.73/305 kt | MO.73/300 kt | MO.73/305 kt |
| Runway for 740 km (m/ft) | 1157/3796 | 1314/4311 | 1105/3625 | 1275/4183 |
Given that the RJX series is now in production with the first ones expected to enter service later this year, the RJX series is an option to consider.
While acquiring older-generation BAe 146s also is being evaluated, a number of factors related to reliability, higher operating and maintenance costs, and the likely need for additional refurbishment, mitigate toward acquiring newer, or new, Avro RJs for the new airline's fleet, except possibly for air freighter use.
Additionally, per month leasing costs can be two-to-three times higher, as a percentage of aircraft value, on older aircraft compared with newer aircraft, making their monthly leasing expense potentially higher than for new or newer aircraft.
One approach worth considering is to commence operations with one generation of aircraft with an option to return those aircraft to the lessor or manufacturer without penalty in an "upward trade" to acquire the newer generation aircraft when they become available.
Such options are commonly supported by manufacturers in their effort to market newer generation aircraft, and would enable the new airline to avoid any delays that might ensue from backups in the RJX build pipeline.
Given the new airline's stress on technology and the comfort of the passenger, combined with the very real considerations of lower operating and maintenance costs and greater flexibility, consideration of the latest generation of aircraft should be evaluated carefully, along with limiting seating to five abreast, including in Value Class as described elsewhere in this plan. However, factors such as initial acquisition cost, refurbishing costs, operating and maintenance expenses, reliability, operating parameters, customer preference, and financing packages available for purchase or lease all must be considered.
For purposes of the costing factors utilized in this business plan, acquisition and operating costs for dry-leasing new Avro RJ100 aircraft with a high-level of technical features and passenger amenities have been employed, with a cost comparison also made for purchasing the same aircraft. Adjustments would need to be made for other aircraft types or ages and acquisition methods.
Aircraft acquisitionAnother issue still being evaluated and which will be decided is the question of how to acquire the aircraft. For a variety of reasons, including the ease with which the leases can be cancelled by the lessor and the lack of "ownership" of the aircraft, wet leasing has been ruled out except for short-term acquisition of aircraft that would be employed in meeting peak demand-type services as outlined elsewhere in this business plan.
The two remaining options both need to be examined from cost, flexibility, and finance points of view: Dry leasing the aircraft (generally on a five-year lease), or outright purchase. Both provide long-term control over the aircraft, and while both options tend to restrict changes in the fleet that might be preferred after the initial years of operation, market conditions and high demand for aircraft indicate that it would be relatively easy to be released from the leases, or to sell or lease the aircraft to new owners or operators, or to return them to their sources.
A number of leasing sources are available for the BAe Avro aircraft being considered, and some used aircraft also are available from time-to-time on the market from various sources. In addition, new aircraft can be acquired directly from the manufacturer on a variety of different plans and options, as well as used aircraft on occasion.
Cost factors employed assume dry leasing of new Avro RJ100 aircraft in 99-seat configurations, with a comparison for purchasing. It is anticipated that finance guarantees up to 85 percent of the acquisition cost of the aircraft could be obtained from the Export Credit Guarantee Department of the United Kingdom (ECGD) for purchasing British-built aircraft exported from the UK.
3.4 Technology
Flight may be based on aerodynamics, but the proposed airline will be based on technology, and lots of it. Efficiency and convenience through use of the most up-to-date informational and electronic technologies, in addition to modern aviation and navigational technologies, are guiding principals of the proposed new airline. Technology will also be a cornerstone of the new airline's marketing strategy.Among the technological features the new airline will offer are:
- Internet marketing and online reservations (e-reservations) and sales (e-sales) that will provide quick and easy access to airline schedules, flight availability, reservations, and ticketing to a wide range of customers worldwide. This eliminates payment of agency commissions and keeps costs low - savings that can be passed on to the customer.
- Electronic ticketing (e-ticketing) which will enable passengers to obtain their tickets online and avoid the need to obtain paper tickets from airline offices, travel agencies, or at the airport. It also frees the airline from having to stock, track, and issue tickets and maintain paper trails of them. Again, more savings for both the airline and the customer.
- Electronic check-in (e-check-in) that will virtually eliminate waiting in line to check-in for e-ticketed passengers, enabling them to confirm their identities, obtain their boarding passes, and check-in their baggage (and even purchase tickets upon check-in) utilizing a user-friendly kiosk that eliminates those last-minute frustrating waits to get to the counter. And it also greatly reduces the airline's needs to staff check-in desks, control long lines, employ local contract ground staff, and expend money and resources on an antiquated system that only adds to the traveler's inconvenience and frustration. Another win-win situation for both airline and passenger.
- Electronic baggage tracking (e-baggage tracking) which will enable the airline to track any piece of baggage from check-in to final pick-up and claim. If courier services can track parcels as they move around the world, and enable customers to track their parcels using tracking numbers and online tracking systems, then why can't the same system be used to assure that no passenger will ever again have to wonder where his or her baggage might be? There may still be contingencies (such as late check-in, lack of space, security restrictions, late connections, and so forth) that cause baggage not to be placed on a given aircraft, but at least both the airline and the customer can be assured that they both know exactly where the given item of baggage is at any moment, and when it might be expected to arrive at the destination. This could well be an exclusive feature of the proposed new airline since no other airline appears to be utilizing it at present.
- Electronic cargo tracking (e-cargo tracking) is the same basic idea as e-baggage tracking, and will use the same basic system, only for tracking cargo and parcels.
- Electronic quality control (e-QC) is another innovation that will enable technology to create a far better flying experience for the customer, give airline management and staff greater control over airline operations and performance, and save time, effort, money, and staff resources in the process. What is envisaged is a central electronic matrix that controls and monitors scheduling of aircraft, equipment, personnel, supplies, and support materiel, and responds to problems, excesses, and deficiencies.It also will track all elements of a given passenger's or customer's transactions and interactions with the airline, from initial flight inquiry through reservations, ticketing, check-in, flight, connections, and final baggage pick-up, claim, and check-out, as well as any standing preferences, follow-up comments, inquiries, or problems. It also will monitor things like weather conditions, flight delays or projected delays, gate jam-ups, and other contingencies, and will automatically notify both appropriate airline personnel as well as passengers and customers of any advisories, warnings, or changes.
- Electronic financial control (e-finance) will enable complete electronic financial control and monitoring of the airline's finances, clear advantages.
- Additional technological features will be incorporated on-board the aircraft to provide flight crews with the latest navigational and communication technologies to assure the highest level of passenger safety and also airline reliability and punctuality. Included in this technology, in the case of the Avro aircraft, is all-digital ARINC 700 avionics with advanced Cat IIIb low weather-minimal landing capability to permit landings under the poorest permissible approach and visibility conditions.
Market Analysis Summary
Economic growth and the requirements of redevelopment, not to mention the impending entry of several countries in the region to the European Union, are creating increased demand for air services between Western Europe and the countries of Southeast Europe and Turkey.The market combines a variety of elements all of which demand a higher quality of air service than often currently available:
- Business travelers requiring convenience, reliability, speed, and schedules built around business needs.
- Government and international organization travelers, requiring the same elements.
- Personal and leisure travelers from the Southeast Europe/Turkey region who have the money to travel by air and who increasingly demand a higher level of service and convenience, but at an economical cost.
- The "Diaspora," Personal and leisure travelers originally from the Southeast Europe/Turkey region, but now living and working in sizable numbers in the countries of Western Europe, with the same demands.
- Western European personal and leisure travelers, primarily traveling on the airline's routes between Western European points.
- Seasonal (primarily summer, with some limited niche markets in the winter period) holiday travelers, primarily destined for Greece, Turkey, and the islands of the Mediterranean. Cost, reliability, convenience, and destination are their concerns.
4.1 Market Segmentation
A complete market analysis and segmentation will require a specific passenger and destination survey, the cost of which is included in the Start-up Costs for the airline.Preliminary analysis (based on a variety of methods, including observation, interviews with travel- and airline-industry professionals, economic segmentation, future projections based on marketing plans, and experience with the region and market) for planning purposes, however, indicates the following approximate market segmentation overall (considerable variations, of course, would be anticipated depending on route, season, and other factors):
- Business - 15%
- Government and International Organizations - 10%
- Regional Resident Personal and Leisure Travelers - 20%
- Diaspora Personal and Leisure Travelers - 10%
- Western European Personal and Leisure Travelers - 5%
- Seasonal Holiday Travelers - 10%*
The accompanying Market Analysis table and chart below show total potential markets based on estimated population in each segment, as well as potential growth rates in air travel in the new airline's target market region within those segments, but do not reflect the anticipated passenger demand from those markets. Overall make-up of the airline's anticipated passenger loads by market segment are presented above.
4.2 Service Business Analysis
The overall airline industry operating between Western Europe and Southeastern Europe and Turkey consists of four primary segments:- Established mainline European carriers (primarily Swiss International, Austrian, Lufthansa, Alitalia, Malev, Turkish) utilizing their Southeast European routes as spokes connecting to main hubs in Western Europe (or Budapest and Istanbul in the case of Malev and Turkish, respectively) and serving to feed traffic to their prime intra-European and trans-Atlantic routes (or domestic Turkish routes in the case of Turkish).
- Smaller, but generally well-established regional airlines primarily from Western Europe or the upper level of Eastern European states (primarily Swiss International, Tyrolean, and Adria) that perform essentially the same function as the mainline carriers or, in the case of carriers like Adria, link destinations in Southeast Europe to their own national capitals.
- Home-based Southeastern European carriers (such as ADA Air, Albanian Airlines, Avioimpex, Balkan Air, Hemus Air, JAT, and Tarom Airways) that often operate older, Soviet-built aircraft or turboprops, offer a generally lower level of service (though not always lower fares), and are often less highly regarded, including by travelers from Southeastern Europe. These airlines connect points within Southeast Europe, or they may connect Southeastern European destinations to major destinations in Western Europe.
- There also is a fourth segment worth noting, and that is the fairly significant charter market that exists within certain niche or seasonal markets. This market includes charter flights between Pristina and destinations in Switzerland and Germany, as well as primarily summer charters from Southeast Europe to New York and other destinations in North America. These charters are often operated by individual travel agencies or airlines, and often are categorized by a low level of service and utilization of older, often Soviet-built, aircraft. There also are the vacation charters that operate from Western Europe to Greece, Turkey, Cyprus, and the other holiday spots of Southeastern Europe and the Mediterranean.
4.2.1 Main Competitors
The new airline's main competitors will vary depending on market and route served, and the category of passenger. For the most part, competition can be expected as follows:| Business and Government/IO segments to and from Southeastern Europe | For SE European Regional and Diaspora Personal and Leisure Travelers | For Western European Personal and Leisure Travelers, as well as Business and Government/IO Travelers between Western European destinations | For seasonal Holiday Travelers to Southeastern Europe and Turkey |
| Adria | ADA | Adria | Alitalia |
| Alitalia | Adria | Air France/Air Inter | Austrian |
| Austrian/Tyrolean | Albanian | Alitalia | Balkan/Hemus |
| Croatian | Alitalia | Austrian/Tyrolean | Britannia |
| Lufthansa | Avioimpex | British Airways/CityFlyer Express | British Airways |
| Malev | Balkan/Hemus | Croatian | British Midlands |
| Swiss International | Croatian | Deutsche Air BA | Cyprus |
| Turkish | JAT | KLM/KLM Cityhopper/KLM UK | Hapag Lloyd |
| - | Tarom | Lufthansa | Lufthansa |
| - | Turkish | Luxair | Maersk |
| - | - | Malev | Malev |
| - | - | Sabena | Olympic |
| - | - | Swiss International | SAS |
| - | - | Turkish | Swiss International |
| - | - | - | Turkish |
Again, the extent of competition (and what is listed here is not comprehensive) dictates the importance of the new airline's three-prong strategy to seek out unserved and under-served routes and city pairs, key niche markets where it can effectively compete or create its own market, and meeting peak travel demands on key regional, seasonal, and intermittent routes. It also points out the importance of standing out from the crowd through offering a higher level of service and convenience, and utilizing technology and a service-oriented staff to achieve recognition and passenger preference right from the outset.
Strategy and Implementation Summary
The airline's strategy has already been adequately explained elsewhere in this plan: target unserved and under-served markets, seek out niches and unmet demand, and offer a higher level of service and a higher standard than the competition. The airline will utilize technology to reduce costs and offer better service and greater convenience to the passenger.In this section we'll examine how the new airline will go about cutting out its niche through its marketing strategy.
5.1 Marketing Strategy
The proposed new airline intends to cut out new territory as it goes about marketing itself. While it will clearly serve the target markets of Southeastern Europe and Turkey, it will just as clearly be a different kind of player on the field, and will seek to be known not only as a Western airline, but at the cutting edge of the aviation business in Europe.The airline's emphasis on the latest information and electronic technology, and its stress on comfort, convenience, safety and customer service, will be cornerstones on which the marketing strategy will be built.
The airline will utilize a combination of methods to achieve the recognition that it both desires and needs. A fairly large advertising budget is planned to buy the space and time to get its name and message in front of the largest possible group of potential customers that it can. Given the crowded field of European regional airlines, it is better to come on like a lion than a lamb, or you may be lost in the herd.
The airline will also utilize public relations to good advantage to extend and supplement its advertising budget.
There are a number of "hooks," aside simply from its newness, that the airline can utilize to get the media's attention. The airline is opening up new markets, and it also is transcending the technological barrier with the latest technology in the business in Europe, or anywhere. It has big ambitions, but knows that it needs to serve the customer first to realize them. And it wants to know and serve its markets better than anyone else.
Everything about this airline, from its name to its colors, from the look of its planes to its airport kiosks, from its smart but informal crew uniforms to its advertisements and literature should set it apart. And it costs little more to do things freshly and smartly than the more ordinary way of doing things. An organization is new only once in its life, so the airline should grab that opportunity and get all the attention it can at the outset. And it needs to have both an adequate budget, as well as an outwardly directed management, to achieve that end.
The new airline will become known as one where all the staff practice the motto, "We have a job to do, and we do it every day - for you!""
5.1.1 Pricing Strategy
Like everything else about it, the new airline's pricing strategy will also set it apart from the pack and will form a key aspect of its overall marketing strategy.It is almost a stock joke, the unwieldy and impenetrable forest of airline tariffs and fares and promotions (often available for something like three seats on a flight - and that is meant to win customers) common in the industry today. Few things have garnered the notoriety and degree of customer suspicion and dislike that airline pricing has, and yet there are few moves afoot to improve the situation.
We intend to change that, and will not only make our business more predictable and "user-friendly" to the passenger, but also will help fill our planes and make our financial direction more predictable and clear to our management and our bankers as well.
The game plan is simple enough, offer customers good service to places they want (or need) to go to, and at a fair and predictable price. Competition on the basis of price alone has spelled disaster for more than one carrier (start-up and veteran alike), and once down that slippery slope it is hard to turn back. And while price is clearly an important factor driving the marketplace, it is by no means the only one. It will not be our aim to be the lowest-priced competitor in the market (though we may be on occasion). Nor will we seek to be the highest priced, either. Fairness, clarity, and a rational fare basis, combined with better service and greater convenience than offered elsewhere, will be our guiding principles.
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