Pakistan International Airlines

Executive Summary

The report highlights the current marketing mix of Pakistan International Airlines. This information supplied in this report is based on an interview with the Assistant Marketing Manager of PIA.

Pakistan International Airlines is the national flag carrier and was established in 1955. It not only provides transportation services, but its operations extend to providing cargo services and courier services also.

The private Airlines operating in Pakistan including Emirates, Air Blue, and Royal Airways etc are performing very well as far as the international flights are concerned, but they fail to cater the domestic market. Here Pakistan International Airlines differentiates itself by providing direct flights to distant areas, where other airlines are unable to stretch their network due to high cost. A flip side of this is that it is a liability on Pakistan International Airlines to cater this loss making sector, where most of the flights are not packed.

Pakistan International Airlines serves two markets вЂ" Domestic and International. In the domestic sector, it has out performed itself by stretching its networks to areas where other airlines do not fly to. In the international market it faces severe competition, especially due to the fact that these international organizations are providing fares much lower than Pakistan International Airlines.

Pakistan International Airlines major strength is its wide domestic network and high employee knowledge. It weaknesses include high fares, centralized decision making and ageing fleet. Pakistan International Airlines still has the opportunity and potential to innovate itself. Only then it can counter the increasing competition. Other threats to Pakistan International Airlines are increasing fuel prices and unstable government policy.

The main objective of Pakistan International Airlines is to provide better service to retain its customers and hence increase its profitability. This objective is reflected in all the goals of the various departments of Pakistan International Airlines.

Pakistan International Airlines has a direct distribution network, where customers get their ticket directly from the booking offices, located in major cities of Pakistan. It also has indirect distribution, where agents supply customers to Pakistan International Airlines and charge a certain commission on it. These authorized agents are selected by Pakistan International Airlines if they fulfill a certain criteria.

The flight attendants in Pakistan International Airlines play a very important role in enhancing customer satisfaction level and delivering the promised service quality as intended. They are trained at specific �training centers’ to provide consistent delivery of service. They are also trained for emergency and unexpected situations such as problem customers and how to deal with them.

Similarly, the environment of PIA where customers are constantly taken care of by providing the best available service keeping in mind their individual needs. The decor, the seating arrangements, the food that is served, the humsafar magazine provided etc. creates a positive impact on the way customers would perceive how their flight went.

PIA has segmented its market in such a way to cater to different classes of society that has been divided. It has also kept in mind these groups income level so that every group could be individually satisfied with their expected service. For example there is business class arrangement for business travelers. Similarly there are also economy class and first class for middle income and higher income level respectively.

The PIA name plays a very vital role in establishing its brand equity and developing its image in the international world. The slogan �come fly with us’ actually encourages and attracts the potential customers in trying out the airline and experiencing the promised service that PIA delivers.

Introduction

The transportation sector holds a very important position in the economy of Pakistan. Currently it contributes almost 10% in the GDP.

PIA is one of the leading airlines in the airline industry. The state owned PIAC establish in 1955 to conduct the domestic as well international operations. It enjoyed the monopoly until the deregulation of aviation industry. It is the national flag carrier

Industry Analysis and Current Marketing Situation

The aviation sector was deregulated just 11 years ago thereby implying that it’s still in infancy here in Pakistan. This encouraged many airlines that stopped their operation many years back due to Millions of Civil Aviation Authority dues. Bhoja, Hajvery and Raji were closed down, but they have been granted license again.

Air Blue and Royal airlines have initiated their operations also and they are the second already operating in Karachi-Dubai cargo flights.

One market which is not served by the Private Airlines includes all flights to those domestic which are not profitable. It is required by the government that PIA offers its services in not so profitable areas, which is a liability of PIA being a semi private organization. PIA calls it “loss making sector”.

Private airlines have stunned the aviation industry as they charge below cost fares. At the moment when fuel prices are touching all-time high levels in the international market, cut-throat competition among private airlines has placed a million-dollar question about the feasibility of these airlines.

PIA operates in two major markets; Domestic and International. Pakistan International Airlines has the lion’s share in the domestic market. As it is the oldest and the pioneers it has the better fleet as compared to its competitors who are comparatively newer in this segment. Besides this, Pakistan International Airlines has a huge network of flights through out the country. The number of flights remains the same during on-season and off-season.

Internationally also, Pakistan International Airlines is encountered with a severe and strong challenge with many renowned international names. Pakistan International Airlines faces competition with not only international airlines but also with local airlines on the various routes to the Middle East and the Gulf. It is still successful mainly because people face language problem, and they perceive that PIA being a local company would provide Halal food only.