Question

Who are the major players within the airline industry globally? How have competitors in the industry positioned themselves on strategic, marketing and technological dimensions, i.e., what are their different strategies?

Answer 1

American Airlines Group can be named as World's largest airlines in a number of ways. Based on number of passengers carried, revenue passenger mile, fleet size and overall revenue it is by far the number one on the list. However, when talking about assets value, Delta Airlines top's the list. While, talking solely in terms of overall profit, Southwest Airlines are the global leaders.

The Airlines industry is hugely competitive as a result of which each Airlines have a different markeing and operational strategy. In most of the cases it has been seen that companies in this sector tend to play around with their technological dimensions to attain competitive edge in the market.

Let us see a few different styles noticed in the strategical approach:

1: Choosing target audience and target routes:

Airline industry is a numbers based industry, where a lot of analytical decisions have to be made. Airlines have the toughest decision to chose which routes they want to operate on, and thus what would be their target audience. Whether their audience comprises of regular travellers or vacation travellers or students or professionals?

Different companies tend to target different sections of target audiences based on the routes.

2. Size of the planes and specifications:

Again based on the analysis of average travellers on the route, the companies tend to decide the size of the birds. Another important thing to notice is that, companies who provide more space, as in leg space tend to charge higher fares as compared to companies which provide less leg space.

All this size and money issue is related to amount of fuel used to carry the passengers, a smaller plane uses less fuel and thus Airlines tries to cut every possible inch off the plane.

3. No of passengers on each flight:

Different airlines carry different number of passengers, depending on how much profit they want to make considering all the factors in play.

4. Food on Flights:

Some airlines serve food on flights while others don't. This is one very important factor when we talk about marketing strategy.

All Big airlines are comfortable keeping air fares a little high in return to food services on plane, rather than not providing food which could give them a competitive disadvantage.

5. Increase or Decrease in number of flights depending on seasons, festivals and ocassions on specific routes is also seen. Which is a strategic approach followed by a lot of companies.

So the strategies start from target audience and cover a lot of aspects. With the competition being very tough day by day in the Airline industry the margins are getting lesser and lesser, because of which most of the companies are trying to find innovative ways of attracting more customers towards them. For example: earning flying points or flying miles, which customers can use next time with same airlines to get discounts is one such marketing Strategy.