Packaged to fly

HARDSELL HAS taken to the Indian skies with the three domestic air carriers locked in a no-holds-barred dogfight to claim their share of the increasing air passenger traffic. Growing at a rate of about six to seven per cent during the past few years, the lucrative market of air travellers is up for grabs.

The story goes back a little over five years when the monopoly of the orange and white national carrier Indian Airlines ended. A flurry of activity commenced with the opening up of the Indian skies. Many private operators, lured by Indian skies, set up shop and sent their aircraft cirsscrossing the country. But most of the new entrants grounded their operations at the same speed with which they took off.

Among the private entrants to survive were the Mumbai-based Jet Airways and the New Delhi-based Sahara Airlines. And, with them came competition. But matters trotted along. Or so it seemed until early this year. As whiz-kids from the IT industry, armed with laptops, shrank the country's workspace, there was a zoom in the number of air travellers.

With three domestic air carriers - Indian Airlines, Jet Airways and Sahara Airlines - to choose from, airline operators are no longer the kings they once were. So what does one do when faced with a market changing from a seller's to a buyer's. With consumers calling the shots, fresh options were to be explored.

Slash prices to attract traffic, a neighbourhood shopowner would have said. But then, airlines is big business and with regulations in place alternatives had to be thought of.

If not discounts, add-ons, said the jargonised marketing lingo. And with it came the package deals. It is but a variant of the FMCG segment's `buy one, get one free' mantra. `Fly with us and get a hotel booking thrown in' is the latest buzzword of selling in the civil aviation sector. Common ground was also struck between the hospitality industry and the airline industry. With corporate and the upper middle-class travellers accounting for a significant chunk of air traffic, hoteliers and airline operators teamed up to bolster each other.

Consider this. A busy executive, who flies at company's cost anyway, is contemplating travel to, say, Goa. He has got himself into this rather difficult situation where he has to deal with his company's rising expectations as well as keep his date with rest and recreation. This is where savvy overtakes sense.

Throw in a hotel accommodation along with the air ticket and the deal is done. Indian Airlines, for instance, has tied up with leading hotels. And so have Jet and Sahara. Labelled `holiday promotion packages' these offer concessional rates on hotel tariffs. Through a string of deals with hotel chains, just about everything is thrown in along with an air ticket.

With an increasing tendency to mix business with pleasure, the deals bring out the best possible in selling. But the deal is pushed through the customer in a subtle manner. While specialised divisions take care of corporate clients, for the individual travellers who want to fly there is the seemingly ubiquitous but crucial travel agent. With as much as 60 per cent of the ticketing done through travel agents, airline operators keep them in good humour and, in the process, push across their package deals.

The lean season - July to September - is the most suited for launching such schemes. Termed `holiday packages' the offers are, in real terms, easy solutions to overcome the regulated pricing system. While checks exist on under-cutting, air operators also realise that there is no long-term logic in slashing prices. "A majority of air travellers are loyal customers, so it would be meaningless to cut the price to attract a marginal increase in passengers," reason airline executives.

As Executive Class passengers are, anyway, difficult to be weaned away through such deals, the bait is thrown at those travelling in the Economy Class and is targeted specifically at the upper middle-class travellers, senior citizens and the upwardly-mobile, the deal envisages paying a marginal increase with which the traveller gets the hotel accommodation and other add-ons thrown in, as the case may be.

While the lean period is normally betwen July and September, in all probability the deals are likely to be extended for quite some time to come. More so as the deals are struck only on low volume sectors. For destinations such as Port Blair, at times the flights carry as low as 20 passengers at a time. Throw in a package deal and the undecided is tilted towards the destination as well as the airline. Package deals are unlikely to end with this. Though, for the moment, airline operators are vying with each other dishing out hotel accommodation, the day may not be far off when more add-ons are thrown in - especially to lure the foreign traveller. This is all the more evident given the inroads the private air operators have been making with every passing year.

T. S. Shankar & V. S. Sambandan

in Chennai

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