The document discusses Etihad Airways' international marketing strategy using the airline as a case study. It analyzes Etihad's business model, strategic concepts, opportunities, and recommendations. Specifically, it covers Etihad's product lines, differentiation strategy, key partners, resources, cost structure, customer segments, and value proposition. In conclusion, it recommends Etihad maintain regional brand awareness, focus on relationships with suppliers for advantages, pursue continuous innovation, and target the business/first class market.
8. Key Question
How does Etihad differentiate themselves
amongst a highly competitive market?
9. Potential Takeaways
At the end of our presentation you should be
able to:
• Have a High Level knowledge of the Airlines
industry
• Understand the business model and
strategic concepts of Etihad
• Recognize Etihad’s potential opportunities
for further strategic development
12. Political
factors
• Since 1971 the UAE creates liberal climate towards foreign cooperation. Etihad is a the National Airline of United
Arab Emirates, therefore it is strictly regulated and supported by the government.
Economical
factors
• Being a company that carries political objectives it has certain economic benefits such as lower taxation,
protectionism.
• Tax-free salaries for the employees
• Abu Dhabi has a well-structured network of the banks, banking activities are strictly controlled by the UAE
Central Bank
Social
factors
• “Emiratisation”- "We are giving wings to your dreams".
• The UAE has a relatively high Human Development Index among the Asian continent, ranking 41 globally.
Technical
factors
• Etihad as a young fast growing company that reflects the interests of the state strives to be as innovative as
possible, with the best services and up to the date.
14. Rivals (HIGH):
Full-service Airlines
Entry barriers
(HIGH)
High start-up cost,
High Risk, Slots,
Leases, Perimeter
rules, Marketing
strategy
Power of Buyers
(MEDIUM):
customers are very
quality sensitive
Power of substitute
(LOW):
Railway, Car rental
companies, shuttle
buses
Power of
Suppliers (HIGH):
Airbus, Boeng,
Fokker, Fuel,
Airoports,
Government
Rivals:
Emirates
Qatar Airways
Air Arabia
Kang Pacific Airlines
Eos Airlines
Cathay Pacific Airways Limited
British Airways
15. Etihad Airways is the flag carrier airline of the UAE, was established
in July 2003 and based in Abu Dhabi.
The business model – Premium Service Airlines.
In 2013, Etihad Airways received Skytrax World Airline Awards – "Best First Class", "Best First Class
Seats" and "Best First Class Catering".
2011 year Etihad reached its break even point.
Etihad products:
• Air transportation
• Operations into Holiday spots,
• Air Cargo
Marketing objectives:
• Luxury air transportation for passengers and goods
• Reasonable Price
• Exceptional Customer Service and constant improvement of the service
• Customization of services
Etihad Airways Overview
16. Etihad’s mission:
Eager to reflect the best of Arabian hospitality, as well as enhance the prestige of Abu Dhabi as a
center of hospitality between East and West.
Their goal is to be a truly 21st century, global airline, that provides
not just a service, but unique experience.
Targets
• Decrease cost (operational by 10%, marketing by 15%)
• Increase Yield (high rev sectors/products such as long flights in first class)
• Maintain brand quality
• Increase profits every year
• Increase the fleet
• Create inbound holidays to Abu Dhabi by 2030
Etihad Airways Objectives
18. Etihad Product Lines
• Passenger Flights, Air Cargo Flights, Tourism
• Focus on Passenger Flights
– Passenger Products – Diamond First Class, Pearl Business Class, Coral Economy
Class
• Services – In-flight services (entertainment, menu, duty free, etc), 24-hour
check-in, Etihad lounge, Chauffeur service
• Employees – well-trained, informative, friendly, available on request
• Image – in pursuit of excellence and perfection; exhibited through superior
travel experience from start to finish
19. What is Etihad Product Strategy?
Relative Market Share
HighLow
MarketGrowth
HighLow
Dogs Cash Cow
StarsQuestion Marks
BC: Business Class
FC: First Class
E: Economy Class
CC: Crystal Cargo
2D: Express2D
H: Holidays
BC
2D
FC
H
E
CC
20. Pricing Strategy
• Market Penetration
Looks to dominate market share in Middle East
• Middle to Premium Airline
Tries to maintain somewhat similar quality to Emirates but price like British Airways
• Differentiation Strategy
customers not price-sensitive, competitive market with few major players, customers
have a specific need on a regular basis, firm has unique resources which can be
used to satisfy these needs in ways which are difficult to copy
21. Placement Strategy
• National Airline for UAE and Abu Dhabi
• Abu Dhabi fastest-growing hub of Middle East
• Own private terminal at AUH
• Few regional players; part of MEB3 which includes
Etihad, Emirates and Qatar
• Regiocentrism Focus
22. People
• A strong focus on Emiratisation
• Award winning Training programs and workshops
prepare employees for top-notch performance and
career progression
• Key selling point of Etihad with such attention based
around customer service
25. Key Activities
• Acquisitions and Stakes across the globe
• Pre-Clearance Facility
• Equity Alliances & Strategic Partnerships
• Innovation
– IFE
– Butler on Board
– Flying Suites and Apartments
• Savings in Fuel through Hedging
• Purchase order for more 787 and A350 for low operating costs
26. Key Partners
• Equity Alliances
– Darwin Airline (34%)
– Air Serbia (49%)
– Air Seychelles (40%)
– Air Berlin (29.21%) -^ 49%(2014)
– Jet Airways (24%)
– Virgin Australia (19.9%)
– Aer Lingus (4.1%)
• Strategic Partnerships
– American
– Garuda
– All NipponAirways(ANA)
27. Key Resources
• Favorable Hub Location
• Youngest Fleet in the world (4.5
years) with fleet size of 91 flights
• MRO & Ground Handling through
Etihad owned monopoly
• Global Market reach of 200
Destination connecting via Abu
Dhabi Hub and through partner
hubs and flights
• 10,656 staff
• Enviable and Growing Market
share
28. Cost Structure
• Fuel Costs: Higher cost factor : 40% of total costs
• Labor costs increased by 4.2% (FY2013) due to increase in
Headcount
• New Aircraft Purchase and operational lease expenses
• Sponsorship fees
30. Value Proposition
• Premium Value with competitive price
• Plethora of Luxury Features
• Best in class Quality
• Prestigious Awards for service and innovation in Airlines industry
• Brand Reputation
31. Channels
• High Marketing Budgets for Advertising and PR
Portfolio
• Etihad In-flight Magazine(separate Business
Magazine for Business and first class Travelers)
• Etihad Sponsorships
o Manchester Stadium
o Title sponsor for Abu Dhabi Grand Prix
o Sponsor for Scuderia Ferrari F1 Racing team
• Travel Agents and Websites
32. Customer Relationships
• ETIHAD Guest (Frequent Flier)
• Brand Management
• Etihad Cargo Online support and
Customer Service on Etihad Holidays
• Customer Reputation for Service
34. Recommendations
• Maintain and expand regional awareness of UAE by acting as
brand ambassador
• Focus on upper end of value chain- relationship with
Suppliers(Boeing & Airbus) for Competitive Advantage
• Continuous efforts towards innovation for Competitiveness
• Targeted promotion to upper-class market (focus on business
class & First class)