Strategic Marketing Analysis of Etihad Airways Report

This report presents a strategic marketing analysis of Etihad Airways, the flag carrier airline of Abu Dhabi. It begins with a company background, detailing its strengths (e.g., online booking, favorable location, customer service awards) and weaknesses (e.g., financial losses from investments, complaints about service). The report then examines the external market, including political, economic, socio-cultural, technological, environmental, and legal factors influencing Etihad's operations. A SWOT analysis is conducted, followed by a discussion of market situation, strategic marketing plan, and recommendations, including setting marketing objectives, and strategies for product, pricing, place, and promotion. Action programs, including budget and controls, are also considered, providing a comprehensive overview of Etihad Airways' marketing strategies and challenges.

Running Head: STRATEGIC MARKETING
Strategic marketing
Student’s Name
University Name
Author’s Note

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Table of Contents
1. Company background...............................................................................................................3
1.1 Analysis of internal market...............................................................................................3
1.1.1 Strengths....................................................................................................................3
1.1.2 Weaknesses................................................................................................................5
1.1.3 Opportunities.............................................................................................................6
1.1.4 Threats.......................................................................................................................6
1.2 External market analysis...................................................................................................6
1.2.1 Political factors..........................................................................................................6
1.2.2 Economic factors.......................................................................................................7
1.2.3 Socio-cultural Factors................................................................................................7
1.2.4 Technological Factors................................................................................................8
1.2.5 Environmental Factors...............................................................................................8
1.2.6 Legal factors..............................................................................................................9
2. Conclusion..............................................................................................................................10
Task 2.............................................................................................................................................10
1. Market situation.........................................................................................................................10
2.1 Strategic marketing plan and recommendations..................................................................11
2.1.1 Current market share analysis.......................................................................................11

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2.2 Setting marketing objectives................................................................................................12
2.3 Product strategy....................................................................................................................12
2.4 Pricing strategy....................................................................................................................13
2.5 Place strategy.......................................................................................................................13
2.6 Promotional strategy.......................................................................................................14
2.7 Action programs like budget and controls...........................................................................14
Reference List................................................................................................................................16

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1. Company background
The Flag Carrier representative airline of Abu Dhabi is Etihad Airways. This is one of the
Frontline air Ferrier organisations of United Arab Emirates. Organisation was established
byroyal order issued by Sheikh Khalifa Bin ZayedAl Nahyan. Established in 2003 the company
has grown in a robust way and achieved additional profit every year (Etihad.com 2019). The
company Run into profit for the first time there 2011 and since then the profit percentage for
Etihad Airways has increased year by year. The organisation is privately owned by the
government of UAE. However, the management is up to the discretion of the independent board
of directors as well as corporate officers. The managerial committee consists of citizens of UAE
only. However, with the increase in market competition comma is gradually becoming dependent
on their CEO as well as operational officers who are accomplished as airline professionals from
various Western countries. More than 1000 flights are operated by Etihad Airways each week.
the fleet of Etihad Airways consists of hundred Airbus as well as Boeing aircrafts. James Hogan,
the CEO of Etihad Airways, feels that one critical factor behind the success of the Organisation
is their strategic partnerships with other western airline agencies. Etihad Airways have equity
investment with many popular airline agencies. For evidence they have 24% equity share in Jet
Airways (Etihad.com 2019). Etihad Airways has invested in partnership with several air freight
agencies in countries like Australia, Serbia, Germany as well as other major European countries.
1.1 Analysis of internal market
1.1.1 Strengths
In the United Arab Emirates, Etihad Airways is the second largest airline company. Etihad
Airlines is the first air flight agency of Asia that offers services like online booking opportunities

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from any part of the world. This is how the market reputation among customers of Western and
European countries flourished for Etihad Airways. As O’Connell and Bueno (2018), informs, it
was also the first flight agency in UAE to offer long haul all flight services, for evidence
covering the distance from USA to Dubai. Etihad Airways have self owned self check in service
kiosks for their customers in many parts of the world. Etihad is also the largest purchaser of
airbus model of flights in the world with a record of ordering 45 airbuses in the year 2005
(Etihad.com 2019).
The favourable location of Etihad is also one of the major strengths which Rival Airlines who are
located outside Gulf region cannot imitate. Majority of popular location can be reached from
Abu Dhabi airport with the maximum time span of 10 hours, which makes this particular area, A
Remarkable transfer gateway for international Travellers who are travelling in long haul flights.
on top of that, Etihad has won several International awards because of their excellence in
customer service and high quality of flight control and flight Service also. The brand popularity
of Etihad Airways reached the maximum when the received the prestige of becoming a Skytrax
certified five star airline brand. Compared to all other airline agencies in the Middle East, Etihad
has shown remarkable stability and financial control in last two years with a steady increase of
41% profit in both 2017 and 2018 (Alharthi, Krotov and Bowman 2017). This exhibits that the
organisation has remarkable ability of exploiting the external market opportunities. Analysing all
these factors of strength it can be inferred that the entries in revenue generation of the company
is highly dependent on there provision of best in class hospitality, customer satisfaction and
competitive price strategy. The fact that Etihad Airways has 6300 cabin crew from over 110
different countries proves that they can assure the convenience of customers from any
nationality. This is the reason why, in the year 2017 Airlines carried 18.6 million customers all

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over the world (O’Connell and Bueno 2018). It's growing popularity attracted other airline
companies to enter into strategic Alliance with the organisation. As identified by Mamuti and
Kansu (2013), sum of their partner airline Agencies include Jet Airways, air Serbia, Virgin
Australia and Niki and so on.
The on-board services of Etihad Airlines have a crucial role to play in determining their success
in the airline industry. Etihad Airlines has some of the specifically great products as well as
services in the entire Global airline industry, including the likes of inflight chef, food and
beverage managers as well as flying nannies (Cline 2016).
1.1.2 Weaknesses
Some of the strategic moves undertaken by Etihad Airways have become the reason for their
major weaknesses. For evidence the organisation purchased ownership stakes in several airline
agencies in order to expand its air route. However, this decision was accountable for the major
financial loss faced by Etihad Airways in the year 2016. As highlighted by Kumar and
Steenkamp (2013), equity investment with Air Freight Agencies like Air Berlin and Alitalia is
the reason for $808 million financial loss of the organisation. Besides, the wrong decision of
offering representation of members from these two Airlines into the Etihad management group
was also the reason behind large financial losses. Their members influenced the board of
directors of Etihad Airlines to make two or three major investment all of which were accountable
for financial losses for the company. Recently the services of Etihad Airways have stopped in in
a number of destinations. For evidence, the flights travel from Abu Dhabi to Iran has stopped in
the year 2017 and the four times a week flight to Uganda also stopped in March of 2018 because
of lack of financial equity (Saranga and Nagpal 2016). In spite of fine service quality, meaning
of the passengers of economic class complaints that Etihad cabin crew emphasizes their entire

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focus on business class as well as first class customers. Customers also complain of the waiting
time in case of connected flights, which they finds to be longer than that of the competitive
brands. These issues are not only accountable for the harassment of some passengers but also
become the reason behind unnecessary spread of word of mouth negativities about the company.
1.1.3 Opportunities
The organisation should look out for Organic as well as for the growth opportunities in Asia and
especially in the Indian subcontinent region. As analysed by Masarrat and Jha (2014), the
organisation can also add on to the death of their network with increase in their frequencies on
some specialised markets as in Cairo, Istanbul, Dusseldorf, Jeddah, Bangalore, Manila,
Dammam, Calicut, Ahmedabad and few others.
1.1.4 Threats
Etihad Airways faces the biggest trade from two regional competitions, which are Emirates
airline as well as Qatar Airways. They also face business threats from British Airways, medical
Airways as well as Air Canada in their western air routes. After the popularity of grievances
which word of mouth regarding the issues faced by customers of economic classes, low fare air
flight customer strength of Etihad Airways has decreased by 10 to 15%, which is also a major
threat for the organisation (Derudder, Bassens and Witlox 2013). In terms of economy flights,
they face competition from low cost Carriers like Air Arabia, Fly Dubai as well as others in the
local Asian market.
1.2 External market analysis
1.2.1 Political factors

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The major operations of Etihad Airways are located on the international routes and this is why
the airline is majorly exposed to political conditions of foreign countries. The recent Ban of
Trump administration in America for restricting travel for citizens of the six Muslim countries
who are associated with increase of terror threats is a significant political decision which might
hinder the growth of all Asian airline Agencies including Etihad Airways in all the affected
regions (Fan and Lingblad 2016). Owing to the drastic drop in the load factors on the flight of
airlines of gulf regions to USA is the reason why the airline agencies took the decision of
reducing frequency of the US flights and continue the flight service in many areas of USA also.
The strong logging activities of the European airline agencies also restrict Asian airline
companies to gain entry into the major Eastern Airline markets.
1.2.2 Economic factors
The airline Agencies who are mostly dependent on international routes comma are exposed to
significant changes in the dynamic nature of global economy and hence any major micro
environmental changes directly impact the customer demand of such Airlines. Since 2007-08
global financial crisis and dynamic downturn of economy, Etihad Airlines has been able to
exhibit a major friend of standardization of service and a moderate rate of recovery which helped
to maintain continuous market growth with positive repercussions. However, the unpredictable
nature of the emerging markets like Asia and Africa always keeps the airlines of the Gulf region
at high risk.another important strategic economic factor is a drop in the prices of crude oil which
helped Etihad Airlines to reduce their operational cost. Again, for the GulfAirlines flight Etihad
this implied that the demand for the premium travel to the oil rich regions would be declining.
1.2.3 Socio-cultural Factors

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After the prompt recovery from the financial crisis 2007, the rate of flight travel of the middle
class has increased significantly. This helped in setting up new and emerging target markets for
Etihad Airways which contributed to positive changes in demand for their air travel services. As
people in the emerging regions like Africa as well as Asia are able to effort air travel, Etihad
Airways has promptly focused on such lucrative markets. According to Abeyant (2016), another
major social development which has a significant impact on the market of Etihad Airways is the
generation Y Travellers who carries in large potential for airline business compared to the past
generations. Air travel is natural expense for them since they attach importance to travelling.
This is why, Elango, Dhandapani and Giachetti (2018), highlighted that keeping the generation Y
customers in mind; all airline Agencies including Etihad Airways are developing strong
imperatives for or attracting this generation and making them a critical success factor for their
international business.
1.2.4 Technological Factors
Asian Airways has witnessed significant technological changes in context to the methods
used for reaching out to the target audiences and discovering business patterns for optimisation
of service development as well as delivery. Nowadays, more customers use online media for
managing their flight bookings and engaging with various airline brands (Cole 2013). This leaves
Etihad Airlines which no other alternative than to use online platforms for understanding the
change in customer expectations. This force the organisation to develop mobile applications,
flexibility, customises services and so on. In the recent years aircraft Technology has also
evolved and jet engine is likely to be also involved with a technological advancement that will
make air flight even faster.
1.2.5 Environmental Factors

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The carbon footprint and the SPM output of the air buses of Etihad Airways have been
constantly increasing because of the enhanced demand of the flights and cargos of Etihad
Airways for air travel. This is one reason why the organisation will come under close scrutiny of
the environmental regulatory framework of various countries. However, as an outcome of this,
the Etihad Airways is making investment of significant quantity of resources for the research and
development programs (Squalli 2014). The name of the organisation is to develop alternatives
against the fossil fuel engines. In this regard requires mentioned that the NASA has claimed in
2017 that the use of biofuel can significantly give me the pollution level accountable to air
freight of popular Global airline networks like that of Etihad Airways by at least 50 to 70% in the
upcoming 30 years. This implies that changes in the Global climate and significant impact the
operations and market presence of Etihad Airways.
1.2.6 Legal factors
The administrative decision of Donald Trump as a step towards mitigation of the escalating
terror threat from various extremist Agencies can have a direct impact on the Airways in West.
The decision of the president has imposed various legal challenges for the operation of eastern
Airlines among which Etihad Airlines is the biggest name. Travel bag has been imposed on
several citizens of Muslim countries, which is a legal act that might reduce the access of Middle
Eastern Airline companies to the markets of USA. Again, as researched by Bofinger (2017) it is
not definite whether any other further actions will be undertaken for covertly limiting the axis of
airline companies like Etihad Airways to the USA and EU Markets. In fact, the airline has
reported in given the United Nations representative regarding the biased political challenges,
they have been facing. However, Sharifpour, Walters and Ritchie (2014), certifies that for the
problems are going to advice for Etihad Airways as the European and American Airlines are

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constantly logging with their documents with the demand of reducing the provision of state
based subsidies to the Middle Eastern Airlines to help them gain access to their markets
(Lohmann and Spasojevic 2018). Remove the access to the European and American markets will
be Limited as major prominence should be given to the local Airlines in terms of Airport
Authority, flight runways for faster access to airports.
2. Conclusion
Analysing the arguments presented in the report it can be concluded that there is a growth
opportunity for Etihad Airways in both the business sectors of passenger or cargo airbuses. Since
the organisation connects areas of Europe where local Airlines provides very less service, they
have opportunities in European market opportunities in waiting for the Russian market.
Acquiring new and small Airlines in America or Europe in order to evade the problems that
Etihad Airways have been facing in terms of restriction on the middle Eastern Airline
companies. At the current government, purchasing new air crafts help in the growth and also to
increase their presence on a number of roots as has been planned in the future strategic report of
the company.
Task 2
1. Market situation
Etihad Airways is primarily concerned with international transportation of goods as well as
people. they have a fleet of airplanes which enables smooth transportation of public across
various destinations all over the globe. In aviation sector, the Etihad Airways provides three most
important products for their customers. These are first class, economy class as well as business
class. In addition to that there is also another business sector in the tourism industry which is

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named after the holidays. The transport and logistics department of the organisation is known as
Etihad Crystal Cargo. Nevertheless, business analysis reverts that 40% of the largest revenue
acquisitions have been accountable of the business class of the Etihad Airways which mainly
deals International transportation. First class air travel department is accountable for 20% and the
economy class is responsible for 40% of profit generation shares of entire Global Business of
Etihad Airways (Dunn 2013). Economic laws of the company has largest share of the market
and if a BCF analysis of the company is done, this sector will be represented as cash cows for the
Etihad Airways. Prudentially noting, it also requires mention that the Airways is reputable for
offering superior service to the customers in order to ensure that each and every Traveller have
an excellent and remarkable travelling.
2.1 Strategic marketing plan and recommendations
2.1.1 Current market share analysis
In the analysis conducted in the previous path, it has been evident that is the transportation sector
of Etihad. In this context, it should be mentioned that in the context of spreading their business
across all major air route of the world from the company faces strict market competition from the
Agencies like Jet Airways, Oman Gulf Air Emirates airways, Jet Airways and other major
International firms also (Khan 2014). Organisations, Emirates Airlines can be considered to be
the largest threat for the air freight sector of Etihad Airways.
So far as the market share of the organisation is concerned, the business class as well as the first
class sectors of company has the finest market share compared to all other major middle Eastern
Airline companies. However for defining any market growth strategy, market growth is always

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considered as a critical path which leads the way of determining the success of most of the
product offering in the responsible market.
2.2 Setting marketing objectives
Analysing the market position of the company, the strategic goals for the future should be clearly
defined. For the sustenance of the company in both domestic and international markets, Etihad
Airways has to set out both short term as well as long term goals.
Short term goals
 giving short attention to generation of customer value through out all business sectors
equally
 increase of luxury facilities and their availability to the customers at most affordable
prices in the Western as well as Asian markets
Long term goals
 It can be separated that in order to maintain their competition with Qantas airways for
Gulf airways of Oman, the organisation has increased their profit level by 10% annually,
at least.
 the company needs to increase the customer value by at least 15% by the end of the
financial year 2020
 Number of air fleets should be increased in the sector within the year 2030
2.3 Product strategy
Etihad Airways have to ensure that the quality of products offered by them should be unique in
comparison to that of the competitors. The organisation segregates the product offering into first

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class and business class, thereby providing the consumers the option to select from variety of
services. As per Bose (2018), this facility along with other augmented products like the
availability of online booking of from almost all parts of the world gives the company a
significant competitive edge. Organisation has also started to offer additional products like
chauffeur services the Asian airports. Now, we need to accept these services to the Russian,
Europe at large in the American airports also. This will give the company, significant recognition
across the entire tourism sector along with air transport sector. Etihad Airways is time conscious
regarding their flight timings and they are appreciating for that 24 hours flight service (Jory et al.
2019). However, they have to bring down their average weight timing to about only half an hour.
This will give them significant competitive advantage over any part of the world compared to
their competitors.
2.4 Pricing strategy
At present the company have to use the competitive pricing studies so that they can gain
penetration in new markets. Along with that, competitive pricing will help the company to
maintain their target customer base in urine and also maintain a stable market share in the Middle
East, especially when the significant competition from Qatar Airways, Oman airways, Gulf
airways as well as Singapore Airlines have become high. However, they must also remember
that the Asian customers assume that price is the index of quality in any premium service like
flight or tourism. That is why they must ensure that their prices and not too low so that their
considered to be listed among the low cost carriers.
2.5 Place strategy

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In a significant marketing strategy policies to target customers and provide the highest level of
convenience should be a principal aim. It is on this premises that Etihad Airways should ensure
that they can offer flight booking facilities in all the main offices of the company as well as the
third party flight ticket vendors. In this contest, they should team up with various tourism
Agencies and Tour planning companies so that they can attract bulk booking. In America, the
company has developed alternative ticket booking websites or allow booking of tickets from
other customer service related mobile applications (Al Ali and Ahmad 2014). In Europe, they
have to employ more sales agents to serve the immediate ticket booking needs of customers.
2.6 Promotional strategy
Promotion is critical for the success of the marketing techniques in any business plan. Direct
promotion, guerrilla marketing as well as social media marketing are the three expected
marketing channels that the company should use who spread good news regarding the products
offered by them to attract customers. Sales promotion for discounts and offers provided over
social media recently and true distribution of leaflets and billboards in the past have been a
principal channel of promotion for Etihad Airways (Sandybayev 2017). Currently, address their
promotional strategies to a larger base of customers and that is why sponsorship deals will get
them big market exposure.
2.7 Action programs like budget and controls
In order to make the marketing initiatives successful, extensive programs, budget restaurants as
well as other control measures have to be realised among the organisational objectives. As
evident in the analysis done above, Etihad Airways have to focus more on the long term goals. In
order to that they have to go for my business growth and least cash inputs related products. This

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can be achieved by making significantly more investment in the product domains like. Business
class, crystal cargo, Diamond first class as well as others (Etihad.com 2019). For the low
outcome business growth, the company should focus not to make high end expenditures. For
evidence, in order to segregate the communication channels with the customers, it is
recommendable that was set up customer call services where individual customers would be able
to choose their fares according to their requirement.Based on the availability of a seat, the
customers would be able to make a booking on the spot and would receive a reference ID against
the booking, by citing which we can connect hard copy it at the airport. These are actually
ancillary facilities and they can use the Call Centres they have already in contract with them for
extending such facilities to the customers. Etihad Airways should not make any exclusive
budgetary addition for providing such services (Dunn 2013). Why implementing the competitive
pricing strategy, organisation should be careful so as to reach the break even with the major
competitors and thereby primary objectives like establishing themselves as the topmost Airlines
in the Middle East Market.
Depending up on the strategies to be adopted, the budget should be estimated and it is expected
that the projected budget will not be very high. The strategies should be implemented properly
and each high range of revenue source should be properly aligned with the discuss strategies in
order to lead the company to effective as well as efficient outcomes.

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