Volume 1, Issue 2
On the other end, the rest of the Indian aviation industry has done well as low-cost carriers. Jet now runs more than half its services under the low-cost brand it started in 2009, Jet Konnect.
suppliers by buying 100 new A-320 jets from Airbus, purchasing at volume to ensure a lower price and a partnership-type commitment on maintenance — thus reducing its cost of operations before it sold its first ticket.
It is in tough times like these that comparatively newer and smaller IndiGo Airlines has proved to be innovative and shot up to the top of the food chain by reinventing the low-cost airline model — slashing costs where its customers wouldn't feel the pinch.
Indigo turned regular business travelers into loyal customers because it never acted like a budget airline. The rapid turnaround of its planes (22-25 minutes against an industry average of much more than 30 minutes) was the key to the company making Started in 2006, Indigo has built a viable business over money. They also have a good replacement policy the past five years. Kingfisher, in contrast, entered the where the airplanes, which are more than 5 years old, business by acquiring the low-cost Air Deccan in 2005. are either returned back to the manufacturers or they Both airlines have operated have been sold at a lesser price to other countries’ in the same business airline companies. environment. If anything, Kingfisher held two IndiGo differentiated itself from the advantages. One, it inherited word go. It has positioned itself the infrastructure, staff and as an airline that is always expertise from Air on time. And it follows Deccan; and two, Mallya its positioning like a religion. forged an alliance with Jet The aircraft is always near Airways, the nation’s biggest, capacity. Even if it takes off to smoothen out any late, it makes up for lost time competition. during the journey and never Still, Kingfisher eschewed the fails to announce that it has low-cost model and appears to arrived on time at the have concentrated on forcing destination, followed by its its airhostesses to wear recently received awards designer outfits two sizes and accolades. It consistently smaller and signing up drives the ‘on time every time’ cricketers for its commercials. notion home and gives Indigo, on the other hand, built a powerful low-cost the impression that the customer is part of a model, even though it may be forcing some of its prestigious service. airhostesses to wear standard wigs. For communicating the positioning, a smash hit Still, the contrast between Kingfisher and Indigo is television commercial was premiered in March 2010 telling. While Kingfisher is teetering on the brink, having the tagline “on-time”. With conveyor belts and Indigo is believed to be readying an initial public assembly lines and workers indistinguishable in their offering. uniform spiffiness, the ad projects assembly line efficiency. Toward the end of the TVC, the voiceover The key innovation was simple. Like Tata Motors did quips in an upbeat voice, “We become the world’s with the Nano, Indigo leveraged India's huge potential most powerful economy … on time.” market to form a cost-cutting partnership with And so brand IndiGo is served up with a side of Sydenham Institute of Management Studies, Research and Entrepreneurship Education