» Business » After a successful comeback, can SpiceJet now beat IndiGo?

After a successful comeback, can SpiceJet now beat IndiGo?

By Aneesh Phadnis
July 29, 2016 12:46 IST
Get Rediff News in your Inbox:

The airline pitches its product and service, keeps silent about price in a new campaign as it looks to win over young business travelers, says Aneesh Phadnis.

IMAGE: SpiceJet has managed to pull itself out of a crisis situation.
Photographs, courtesy: SpiceJet

A year after it flew back in from the brink and scripted what is being seen as a remarkable turnaround, SpiceJet has embarked on a brand building exercise.

In a series of short films released digitally the low cost carrier wants to be seen as more than a cheap flight option, but as one that can match and even better others on experience.

It targets several other carriers of its category including IndiGo Airlines and Go Air as it projects itself as an airline that offers hot meals (IndiGo has limited options on this score) and speedy check-in facilities (most airlines are struggling to manage the long queues at their airport counters).

SpiceJet that has managed to pull itself out of a crisis situation and has for the past year clocked 90 per cent plus loads is keen to challenge the leader brand in its category, IndiGo.

And in the process build itself up as an airline that is more than just an affordable ride. “While we want more and more Indians to fly we do not expect them to compromise on their basic needs when they are onboard with us,” said SpiceJet’s chief marketing officer Debojo Maharshi.

IMAGE: SpiceJet’s saviour Ajay Singh. 

Dealing with turbulence

SpiceJet underwent a change in ownership last January with founder-promoter Ajay Singh taking control. 

At the time it was not only battling internal turmoil but also dealing with a problem of trust.

Many SpiceJet flights had been cancelled leaving behind a trail of irate fliers who swore to have nothing to do with the airline in the future.

Under Singh the airline began regaining its lost ground.

Flight operations stabilised and cancellations reduced as Singh settled pending dues and gradually fliers began choosing the airline again, pushing up its load factor.

The airline has managed to do this so far primarily on the back of discounted fares. And therein is its problem.

Just relying on affordability means that the airline is losing out on a large category of fliers, especially business travelers, a major source of revenue for most airlines.

The airline’s latest campaign looks to convey the airline’s new positioning as a carrier for young travellers (business and personal) look ing for a value-option.

“SpiceJet is a turnaround story and the overall travel experience on the airline has improved ever since Ajay Singh took charge last year. But SpiceJet cannot win customer loyalty on hot meals alone and should improve all aspects of its service if it has to wean away customers from consistent high performer airlines like IndiGo,”said N Chandramouli, chief executive officer of brand insight company, TRA Research.

Food, speed and service

SpiceJet has rolled out a television commercial using everyday situations to highlight its hot meal service and the extra leg room it offers on board its flights.

The TVCs conceived by Publicis are up on social networking and digital websites, but yet to go on air.

Clearly the ads are taking a shot at market leader IndiGo, which has limited options for hot meals on board.

The advertising is one way to communicate the difference to air passengers, say brand experts.

Maharshi says, “Our products are unique in the industry and truly represent the brand values that the airline endorses. The basic idea is to communicate the fact that while flying with SpiceJet one need not miss out on pampering himself/herself to the luxury an airline can offer.”

Food is an area the airline has focused on as it believes that this can be a big differentiator.

It has upgraded its inflight meal service and now offers Thai and continental food options. It has also tied up with tea brand Chaayos.

It has also taken a leaf out of competing carriers and has created a premium service that fliers can opt for at a higher price, called SpiceMax.

It gives a customer better leg room, priority check-in, priority boarding and priority baggage handling in addition to hot meals for an extra Rs 500-1,000.

“SpiceJet is clearly targeting the business traveller with its SpiceMax product, extra leg room in front five rows of aircraft and hot meals. The airline had a negative image following its crisis in end-2014 and is working to rebuild it. The TVC illustrates that the airline is focusing on product and not just fares,” says Devesh Agarwal, editor of aviation blog, Bangalore Aviation. 

SpiceMax also earns the airline ancillary revenue which is useful especially since ticket prices are low. 

In FY16 the airline earned Rs 561 crore (Rs 5.61 billion) in ancillary revenue a growth of 30 per cent over previous year.

SpiceJet did not reveal SpiceMax’s share in ancillary revenue or the budget for the TV commercials.

Get Rediff News in your Inbox:
Aneesh Phadnis in Mumbai
Source: source

Moneywiz Live!