This word file contains the detailed analysis of Pakistan's Airline Industry with perspective to Marketing Concepts such as SWOT Analysis, BCG Matrix, Porter's Generic Strategies and Pest Analysis. The report also contains the Marketing plan for Serene Air International.

1. AIRLINE
INDUSTRY
ANALYSIS
Submitted to: Mam Hanniya Abid
SUBMITTED BY
IRFAN UR REHMAN FA17-BBA-069
FAHAD MASOOD FA17-BBA-003
WASIF EHSAN FA17-BBA-177
TAUQEER AHMAD FA17-BBA-167
SAAD IBRHAIM SP17-BBA-091

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Contents
SWOT Analysis of Pakistan’s Airline Industry .................................................................................. 4
BCG Matrix of Airline Industry.......................................................................................................6
PEST Analysis................................................................................................................................ 9
Porter’s Generic Strategies.......................................................................................................... 11
MarketingPlanfor Serene Air.................................................................................................. 13
SWOT analysisfor Serene Air....................................................................................................... 14
Product Offerings ....................................................................................................................... 16
Marketing Strategy..................................................................................................................... 16

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SWOT Analysis of Pakistan’s Airline Industry
The Airline Industry of Pakistan consist of four main players (i.e. Pakistan International
Airline PIA, Serene Air, Air Blue and Shaheen Air International) and some of the private
airlines as well.
Following are the Strengths, Weaknesses, Opportunities and Threats of the Pakistan’s Airline
Industry according to their airlines operations and services.
Strengths
1. Increased International Passengers: The share of International Passenger in overall
passenger traffic increases gradually. According to the previous year’s final report,
the share of international passengers is increased to almost 80%. The remaining 20%
falls in the domestic share.
2. Fastest Growing Domestic Routes: According to the reports of International Air
Transport Association (IATA), Domestic airline routes of Pakistan are the fastest
growing routes because of which domestic passenger traffic is expected to grow at a
good share giving long term advantages.
3. Increased Market Share: In terms of domestic and International airline routes, the
Airline Industry has increasing market share due to increase in passengers every year.
4. Highest Fleet Size: Pakistan Airline Industry has a very suitable fleet size containing
36 advanced Airplanes in PIA, 18 in Shaheen International and 8 in Air Blue.
5. Honour of having second Asian Airline: The Airline Industry of Pakistan has an
honour of having second Asian Airline i.e. it’s national Airline, PIA Pakistan
International Airlines.
Weaknesses
1. Dependence on Fuel Prices: Due to fluctuating fuel prices in Pakistan, Some of the
Airlines have to face a serious loss in terms of profit and competition.
2. Extensive Government Regulations: The Airline Industry of Pakistan is subjected
under wide-ranging government rules and regulations. Due to these regulations, the
operating costs of Airlines increases
3. Less Number of International Airlines: According to the data, Pakistan has very a
smaller number of Airlines which are operating internationally i.e. 3

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4. Limited International Routes: Due to some rules and regulations set by other
countries, Pakistan’s Airline Industry is limited to only some of the International
Airports.
5. Difficulties in promoting tourism and Travel: Due to terrorist violence in some of
the areas of Pakistan, Airline Industry is facing a big loss. Because in promoting
travel and tourism, the Airline Industry gains a good competitive advantage.
6. Burden of High Debt: The Airline Industry of Pakistan is also facing a huge burden
of debts which is affecting its profitability margin.
7. Lack of Incentives: Less number of meaningful incentives to the Airline Industry is a
big problem in improving the condition because it does not allow quality careers to
develop in the country.
Opportunities
1. Greater Revenues: The Airline Industry of Pakistan has an opportunity to earn
greater revenues by their increasing market share in domestic and International
Passenger Traffic. Moreover, the services of Airlines can also be improved to increase
the profits.
2. Technological Innovations: By observing other countries Airline Industry, Pakistan
can adopt some technological innovations that can aid their customers by shifting
their needs. This step is being started by PIA and government should motivate other
airlines as well to adopt technology.
3. Upgrading Airports: The Airline Industry of Pakistan also has an advantage to
increase and maintain their growth trends by upgrading the conditions of Airports for
example to support arrivals and departure of A-380 aircrafts, reducing hazards and
maintaining investment in downstream industries.
4. Increase in International Routes: Pakistan should improve its relations with those
countries that have implied aviation restrictions on us so that International routes can
be increased giving rise to its market share.
5. Price Control: The Airlines of Pakistan should maintain their prices so that passenger
traffic can be increased more yearly. Majority of the people avoid using Airline due to
increasing prices.
6. Advanced Fleet size: As discussed, that main airlines have a suitable and large
enough fleet size. But having large fleet size cannot become profitable unless or until

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the Planes included in it are according to the advanced technology. So, Here the
Airline Industry has a chance to upgrade their planes.
Threats
1. Lack of Government Involvement: It has been noticed that government involvement
to improve the conditions of airlines is very less. They have yet to understand the
importance of Airline industry as a key factor in the economy of Pakistan.
2. Burden of Debt: Number of Airlines are facing a huge burden of debt which is a
main threat to them. Because of this load, Airlines are having difficulty in generating
enough profits according to their budgets.
3. Continuous Rise in Fuel Prices: The continuous increase in fuel prices is also a
threat to Airline Industry because with the increase in fuel prices, they are forced to
increase the rates and hence it results in less passenger traffic in that year.
4. Accidents: Technical Fault accidents can also become a threat for the Airline Industry
adversely effecting customer confidence. It also results in declined revenues and
increasing competition. This situation has been faced by PIA in some years when its
Technical fault accidents occurred.
5. High Competition: The Airline Industry of Pakistan is facing a high competition
with other countries due to the use of technology and other factors. So, the Industry
must work hard to remove this competition and to survive in the market.
BCG Matrix of Airline Industry
The Boston Consulting Group Matrix for the Airline Industry compares the airlines according
to the relative market share and relative market growth.
 Stars: The stars in BCG matrix shows the highest market growth and highest market
share of the organization in industry. Pakistan International Airlines being the first
and national airline of Pakistan is counted in stars. They are contributing the most in
Pakistan’s economy having highest share in International and domestic market as
compared to other airlines. PIA has also introduced new advanced airplanes (i.e. A-

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380) in their fleet size. PIA’s relative market share is also high in terms of generating
revenues and net income.
 Cash-cows: Cash cows have high market share but low relative market growth rate.
Serene Air is included in cash cows. Serene Air started their flight operations two
years before in January, 2017. Their fleet size contains 3 airplanes (including Boeing
737 Boeing 800). They have rapidly gained a high domestic market share by starting
their services within Pakistan in major cities of Pakistan. Serene Air is also known for
their quality services and modernized technology. But, they have low market growth
rate because they have recently started their operations only in domestic areas.
Princely Jets is the first private charter jet operator of Pakistan Aviation
Industry. Their main operations are running domestically in almost 8 cities of
Pakistan. Certainly, Princely jets fleet does not include any Aircraft just like other
airlines, they have some small passenger jets and Helicopters. This Airline is also
included in Cash cows.
 Question Marks: The Question marks in BCG matrix have low market share and
high market growth rate. In Airline Industry, Air Blue is included in Question Marks.
Air Blue started their flight operations in year 2004. Their fleet size contains 8
Airplanes (including Airbus A320). They gained a high market growth rate by rapidly
starting their flights first domestically then were extended internationally as well to
Saudi Arabia, Abu Dhabi and Dubai.
 Dogs: Dogs in BCG matrix have low market share and low market growth rate. A
private airline in Pakistan namely as Vision Air founded in year 2006. They are
operating in a very few cities running only cargo services. They are contributing a
very low market share and market growth rate. This Airline should be merged with
other airlines as they can also operate cargo services.

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BCG Matrix
STAR
 Pakistan International Airline
(PIA)
QUESTION MARKS
 Air Blue
CASH COWS
 Serene Air
 Princely Jets
DOGS
 Vision Air International
MARKETGROWTH
RATE
RELATIVE MARKET SHARE
HIGH LOW
LOW
HIGH

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PEST Analysis
The PEST Analysis includes the macro-environment factors involved in influencing the
whole industry. These include Political, Economic, Social and Technological factors. The
Airline Industry is very much influenced by these factors due to a continuous change in
environment and has gone through a very rapid change.
 Political Factors:
The political factors have always been an important factor affecting an industry of a
country. Same is the case with Airline Industry of Pakistan. In past years, the political
factors have affected the whole industry. It has been observed that some governments
of Pakistan have played an active role in improving the Airline Industry after
analysing that this industry is a major actor in boosting the economy.
Pakistan International Airline (PIA) is most affected by political change. The
government fund allotting is important for their improvement. In recent years, PIA
has achieved some milestones in their history including the upgradation of fleet size
(Air Bus A-380), using the latest technology (E-Ticketing, Self-Check systems, online
registrations etc.).
 Economic Factors:
The economic factors have also influenced the Airline Industry as well. These factors
mainly involve the relationship between customer purchasing power and the prices of
Airlines.
Currently, the Airline Industry of Pakistan has three major Players i.e. Pakistan
International Airline (PIA), AirBlue and Serene Air. Their target market includes the
domestic travellers and the people living abroad (Mainly of UK, UAE and USA).
These countries have strong economies tied with high purchasing power. So, the
customer purchasing power strongly depends on the prices of airline tickets. In
Pakistan, the inflation rate is very unstable so the spending power of consumer
becomes volatile. However, in good economic conditions the Airline Industry has
improved as well in terms of lowering the ticket prices and using advanced

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technology. PIA and other airlines gained a competitive advantage in improved
economic conditions.
 Social/Cultural Factors:
There are certain social factors of a country that influences their businesses. As
general public in Pakistan is becoming more educated and professional so people are
becoming more aware of travelling through airline. These customers want to get best
value for their money. They spend a considerable time and money on selecting the
airline services according to their role and status.
The Hajj Regime in Pakistan is also one of the main social/cultural factors that attract
a huge number of customers and Airlines earn huge revenue in this period. Moreover,
the vacation time-period in Pakistan is also a great advantage for attracting the local
and overseas Pakistanis.
 Technological Factors:
Technology is a very important tool to gain competitive advantage for Industries. In
Past few years 2018-19, the Airline Industry has a very strong impact due to
technology usage. Major technological changes took place in this industry including
innovations in Reservation and Booking Systems. The Airlines also updated their
websites and introduce options of e-ticketing (Online Buying of Tickets using ATM
card numbers), schedule of flights etc. that have become convenient for customers in
terms of time consumption.
PIA, as the national Airline of Pakistan has always been on top ahead of its
competitors in adopting the technological change. As a result, this advancement
helped PIA in achieving the highest market share. Moreover, the Serene Air and
AirBlue have also gained a reasonable technological innovation.

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Porter’s Generic Strategies
Michael Porter has developed three common strategies for businesses i.e. Overall leadership,
differentiation and focus. So, these three strategies are discussed separately for Airline
Industry as follows:
 Cost Leadership
In this strategy of Porter’s Model, the companies work to achieve a lower production
and distribution cost to their target markets. Their main aim is to gain a suitable
market share.
In the Airline Industry of Pakistan, the main target markets of Airlines are the
domestic and international travellers and tourists. According to the strategy, the
Airlines cannot keep their costs too low beyond their budget. However, those that
have high market share i.e. PIA and AirBlue can manage average prices. In both
cases, the main aim is to keep the company costs low for customers.
Airlines that have applied this strategy have gained an efficient and low cost when it
comes to Labour and services.
 Differentiation
The differentiation strategy focuses on businesses concentration on achieving superior
performance by providing uniqueness in their products and services. The main aim of
companies in this strategy is to gain a competitive advantage.
There are number of airlines that have applied differentiation strategy by bringing
innovations in their services. One of the main examples is the use of technology that
different Airlines have provided Online Reservation and E-ticketing. Moreover, they
have also improved their services including staff, accommodation, food, timings, fleet
size etc. that have made them innovative.
Pakistan International Airlines (PIA) and Serene Air are on the top in adopting the
innovation and thus become able to deliver high customer value. However, these
Airlines need an effective marketing so that consumers get to know about their
service innovations

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 Focus
Here, the businesses concentrates on one or more market segments and then decides
that either they should be cost focused or Innovation focused.
In regard to the Airline Industry, there are two main target markets; Domestic
Travellers (Moving within Pakistan from one city to other) and International
Travellers (Moving outside Pakistan to other countries). Now According to their
target, the Airlines adjust their focus on cost or differentiation.
Pakistan International Airlines (PIA): The National Airline of Pakistan is
conducting their flight operations within the country and outside the country as well
(including USA, UK, and UAE etc.). They have also the highest market share and
highest growth rate. So, their main focus is on both cost and differentiation. They try
to set an average price for their customers and also bring innovations in their services.
Serene Air: The Serene Air is a privately owned airline that started their flight
operations in year 2017. Currently due to limited size of fleet, their target market is
only the domestic travellers conducting their operations in six cities. So, they focus on
cost leadership more because the domestic travellers need a reasonable price to travel
within the country.
AirBlue: AirBlue is also another private owned airline operating nationally and
internationally from 14 destinations. Their main focus is on Differentiation strategy
more as compared to cost because their prices are quite reasonable.

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Marketing Plan for Serene Air
 Executive Summary
This Marketing Plan provides an analysis of the airline, Serene Air with respect to
some marketing concepts. This plan includes the current scenario of Serene Air, its
SWOT analysis, competition in the market, its product offerings and the Marketing
Strategy. All the Airline’s strengths and weaknesses are analysed, and its marketing
strategy is also explained by marketing objectives, its Target Market and Positioning.
 Situation Analysis
Serene Air is on third number in domestic passenger market. They are operating
domestic flight operations in almost six cities of Pakistan i.e. Islamabad, Karachi,
Peshawar, Quetta, Lahore and Islamabad. Serene Air rapidly adopted technological
innovations which includes online reservation system and scheduled flights on their
website. Serene Air competitors include AirBlue and some other private airlines who
are running domestic flight operations. They are having total 3 Boeing aircrafts
according to the modern and technological standards. Currently, they are aiming to
start their flight operations from two more cities i.e. Multan and Skardu. To gain a
more good market share in this dynamic environment, Serene Air must try hard to get
access to the international flights by increasing their fleet size and retaining the
services. They seek to differentiate from their competitors in terms of focusing
strongly on customer services and consistency through its operations of airlines.

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SWOT analysis for Serene Air
Following points summarizes the Strengths, Weaknesses, Opportunities and Threats of the
Serene Air that they have faced in their period of almost 2 years.
 Strengths
1. Rapid Technological Adoption: Serene Air in a very less time adopted a
technological innovation by launching online reservations and E-ticketing on
their websites.
2. Fleet of Boeing 737 & 800: Serene Air contains fleet of famous aircrafts that
are famous for their efficiency, safety record and good interior and exterior
structures.
3. Among top 3 Domestic Share: In a very less time due to their strong focus on
high standards and customer needs, Serene Air have become successful in
achieving a good domestic market share more than their target.
4. Professional Staff: From start, Serene Air has always hired professional,
trained and skilful staff (from Pilots to workers) that have help them in
reaching their target and giving value to their customers.
 Weaknesses
1. Slow Market Growth: As discussed above that currently Serene Air is
running their flight operations only inside the Pakistan and their fleet size
contain only 3 aircrafts. So, there is a need for Serene Air to increase their
market growth so that they can access international market as well.
2. Lack of Marketing Activities: Serene Air is facing lack of marketing
activities in a way that they are not using the platform of social media and
others to market their services.

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 Opportunities
1. High Revenue: Serene Air has an opportunity to generate big revenues by
increasing their domestic flight operations in all cities of Pakistan including
Multan and Gilgit.
2. Access to International Market: Due to success in domestic market by
providing high value services and safety flights, Serene Air has a great chance
to reach international market. They must increase their fleet size according to
the requirements of Civil Aviation Authority rules.
3. Customer Attraction through reasonable prices: As compared to the
competitors of Serene Air (i.e. PIA, AirBlue, Air Indus etc.) they can offer
reasonable ticket prices to their customers which can help them in attracting
new customers and satisfying the existing one.
4. Upgrading Fleet: By generating higher revenues, Serene Air has an
opportunity to upgrade their fleet. This upgradation includes increasing the
fleet size and upgrading the current aircrafts with advanced technology.
5. Competitive Advantage: By a little more effort in their services, Serene Air
has got an opportunity to gain a good competitive advantage against its rivals
in market. They should maintain their technological innovations and providing
high value to their customers.
 Threats
1. Increased Competition: If Serene Air does not able to grasp a good
competitive advantage over its competitors then there can be a threat for them
to suffer a strong competition in future.
Competition
Newly entrance of Serene Air in market has caused them to face a strong competition in
especially in domestic market. Their main competitors include: -
 Pakistan International Airline (PIA): PIA is serving Pakistan as the first and
national airline since 1946. They are holding the highest domestic and international
share in market. They are operating flights in all the domestic and some of the
international stations. Their fleet size is also the highest in market including 32
aircrafts with modern Airbus A-320.

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 Air Blue: Air Blue is the second largest private airline of Pakistan. They are running
flight operations in six domestic stations and 3 to 4 international stations as well.
Their fleet size contains 8 modern aircrafts.
 Princely Jets: Princely jet is the Pakistan’s first private jet operator airline. Their fleet
includes passenger jets. They are running their flight operations in 5 cities of Pakistan
and International flights as well including Saudi Arabia, Muscat and Dubai.
 Vision Air International: Vision Air International is a passenger and cargo carrier
airline of Pakistan. They are running their flight operations in 3 cities of Pakistan and
have a license of one International station, Dubai. Their fleet size contains 6 Boeing
aircrafts. Their main hub city is Karachi.
Product Offerings
Serene Air offers the following standard features in their offerings: -
 A mix of excellence, ambition and customer care.
 Highest standard of air travel and comfort.
 Online Reservation/Booking System.
 Skilled and Professional Pilots.
 On time Flight schedule.
 Advance technological Aircraft system.
 Giving a family discount containing 5 members or more.
Due to all these specific standard product offerings, Serene Air was successful in generating
enough revenue in their beginning years.
Marketing Strategy
 Objectives
Serene Air Marketing Management has set two main objectives that can help them in
attaining greater revenue and market share.
1. The first objective is to increase their relative market growth so that they
can get access to International Market.
2. The second main objective is to win a distinct position among competitors
in future and reaching break even points of operational profits.

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 Target Market
The main target market of Serene Air is the middle to upper income professionals
who need a safe comfortable and time saving long journey within the country to
coordinate their busy schedule of jobs, to meet their loved ones and colleagues.
Another main target market for Serene Air can be the government and non-
government organizations in Pakistan who have to arrange business trips to other
cities. Currently, the target markets of Serene Air are limited to domestic destinations
only.
 Positioning
Using the product differentiation technique, Serene Air is positioning the minds of
their customers as most reliable, safe, convenient, comfortable and value-added
services they are offering. They will focus and maintain their strategy of technology
adoption that is accommodating customers.
Strategy
 Product: Serene Air always try to give a good experience to their customers through
their services. They value quality and made it comfortable for their customers. Serene
Air is providing their customers a full online reservation/booking system that is very
easy for them. A one specific offering is that Serene Air gives special discount for
Family (5 members or more) and children (within the age of 2 – 12) and the infants
fully goes free. Some other product offerings are also explained in the previous
section.
 Pricing: Serene Air offers a very reasonable and affordable flight rates for their
customers. According to the data from their website, one-way flight of Islamabad to
Karachi costs from the range of PKR 16000 – 21000/=. Moreover, they also give
discounts on special events such as Eid Festival, Christmas, Summer/Winter holidays
etc. This pricing of Serene Air reflects a strategy that; they try to establish a good
share in market as compared to its competitors.

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 Marketing Communications: Currently, Serene Air is using the platforms of social
media (Facebook, Twitter) for their marketing activities. However, when they entered
in the aviation industry, they also used paper media as well. Ads were published on
different newspapers. But today, they still lack marketing activities that is only limited
to the social media.