Today's News

Today when i jus came into my office two of colleagues litrellay thumped me on to my chair and ask me to log in and get into the official website of airdeccan, the low cost airline carrier. Then it was a frenzy of searches with different combination of locations, clicking search, waiting fr 5 mins, clicking book tkts waiting for 5 minutes and all kina hallabulla for solid 1 hour. No official work was done. Incidentally the most active man to induldge in this waas none other than my manager. He is a man fro Delhi who was quite happy to get a to and fro tkt to Delhi for less than Rs.2ooo. The normal fares can go up to a maximum of Rs.7ooo (depending on the day and timings of the flight) in Indian airlines for a one way journey iself. So where other coleagues who managed to get their tkts booked to delhi, Jaipur, Bhubaneshwar etc...In all almost 10 tickets where booked from my office. There are some interesting things to note from this incident. Well sorry for not giving the news was at all. The news was that Air deccan celebrating its third Anniversary has announced to issue 3 lac tkts for the months of Nov,Dec and Jan for a meagre Rs.3 and the interesting things to be noted here are

1) Out of the 10 tickets booked (5 members) 4 members are first time fliers. With 1 member jus grabbing the opportunity to travel by an airline with no solid travel plans. Others atleast were heading to their home towns. this is jus a case in our office of 10 members. So a clear expansion of market share forAir deccan. Which incidentally willbe reported in the subsequent quarterly letters in Bold that Air deccan has surpassed Indian Airlines in garnering the market share.

2) The 4 first time fliers could very well receptive to the services of the airline and continue being fliers. In this case air deccan has really succeeded in adding new customers which will stand fact to the quarterly bold results they may publish.

3) Air Deccan is a replica of the South West Airlines of USA. Herb Khelleher started this airlines with one simple notion that if we can make people reach their destinations at the right time they wanted at the lowest cost, thenthey will surely fly your airlines. the key they used to turn down costs was to use second rung airports, fly shorter distances and point to point flights between lesser and specified location, etc. It was a huge success in US. But in the case of India it is a different scenario. Though the model and intentions remain to be same the competetive factors these days are not the same. One strong proof to this is that Air Deccan never feels that another low cost carrier is its competitor. rather it competes with the Indian Railways. Thatz the sort they brand themselves. Something sort of every one can fly. The idea of evryone flying has taken over the minimum qualities required of such low cost airlines.

4) Indian aviation industry still is a very risky industry. This move by Air deccan will only create unwanted panic and imbalance in the industry. Sure the financials of Air deccan are not going to improve in the long term by such gimmicks. So a perceived leader of the sort of Air Deccan must think of other long term strategies. Tactics like these are suicidal and incidentally they are taking the whole industry to suicide along with them.

5) These are not valuable business tactics. Sure they will reap great benefits in the short term but not in long terms. low cost airlines must work more on handling airports, baggages, passenger convinience, flight rage atc. Rather than just making everybody fly. Because the thing is to cut cost not to increase revenues.

Naren