Ettihad Airlines Case Study

2553 Words 11 Pages
Register to read the introduction… On the consumer side, the price elasticity faced by the airlines for the product that they supply is pretty low for reasons that will be analyzed later in the paper. On the weaker side of the organization however is the fact that it is based in a country which is very highly dependent on the income produced by its oil reserves and the recent global crisis has proved to the world that the prices of oil are prone to a lot of instability. Even though the fuelling of the jets of Etihad airlines is not a major trouble, the reliance of the overall economy on a fluctuating asset is a considerable threat. On the other side of the story then is the fact that many new players in the field of airline services are coming in. this is mainly due to the fact that the recent few years have seen a sharp increase in the number of billionaires in the world who are carefully investing into diverse businesses out off which the airline business is definitely one. By analyzing the situation of competition that Etihad is currently facing through Porter’s five forces of competition, especially when taking the threat of new entrance into the industry in the shape of better and improved technology or better rates and bargaining power of the suppliers. Because the travelling industry is more or less a necessity industry as the ratio of those travelling not for a vacation still out does the number of those who do, the suppliers have considerable power to exploit the necessities of the customers and obviously this leaves the organization in question in a worse off position because apart from knowing their own markets and risks, they need to have a significant idea about the demand and the risks that their competitors face. The consumer has little or no bargaining power and …show more content…
The first one is the fact that it is supported by a rich background and fuel oriented country for which the funding of a new marketing strategy program is not a problem at all. In fact, the Arab world has recently started various projects to diversify its sources of incomes and tourism has developed to be one of the most important industries in the area. Through the promotion of its national airline then, the government of the country will actually be promoting its tourism industry. Moreover, as for the aircrafts and the operational costs as well as a team of marketing managers to support the strategic plan, the organization is fully equipped to take off for the following marketing strategy.

Recommended Strategy Route
There are two broad strategic directions which are available to the firm under discussion. The first direction is the primary demand centered one and the other one of the selective demand centered one. A primary demand centered marketing strategy is an attempt by the organization to actually grow at the level of sales. This means that such a strategy will be focusing on increasing the customers of the existing brand and this will be either done by attracting those who are currently not using the product of the organization (non users) or to make the existing

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