As Air India prepares itself for sale, the successful bidder has a tough flight path ahead. In all likelihood, the brand will continue. Yet that also carries with it the burden of legacy. A legacy that—if you go back long enough—speaks of a glorious past. A past with extremely high levels of service, luxurious cabins and a golden age of flying. But also a legacy that in the more recent past speaks of less-than-satisfactory levels of service, cabins screaming for upgrades, a bureaucratic setup and general malaise. This contradiction will exist in the traveler’s mind and will inform traveler expectations. And for the most part, it will negatively impact the willingness to pay a premium. To overcome this, continuing with the brand will mean refreshing the brand and nudging the traveler towards positive associations. The burden of legacy will have to be expertly managed.
For airlines, the concept of a brand over the last two decades has diminished. This, as the experience has become more commoditized and the willingness to capture a premium has become even more challenging. Given that a brand at its core is a set of associations which translates into a higher willingness to pay, a high mindshare and ideally a lower cost—most airlines have not been very successful in developing a strong brand.
In the case of Air India, there is no denying the brand has a high recall value and a high familiarity quotient. Interestingly, this has evolved due to a strange set of circumstances. For one, Air India over the years has become a story everyone loves to cover. The general management or mismanagement of the airline and stories that spill over into the political arena make for extensive eyeballs and passionate debate. It is also an airline that many have experienced and thus can relate to. While some travelers have had good experiences with Air India, these are few and far between, for the most part, the criticism continues and the airline has become a punching bag of sorts. At the same time, Air India also ranks high as a sizeable number of travelers can trace their first flights back to the airline. Thus the fondness of memories remains. Together these contradictions influence mindshare. But mindshare is only half the battle.
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Facing a Set of Constraints
For the successful bidder, the challenge will be to continue the brand, move it towards positive associations and then leverage the brand. And continuing the brand comes with a set of constraints. Constraints on business model, constraints on expectations and if buzz is to be believed also constraints on a complete talent overhaul. To get back into the consumers mind as a brand of significance, Air India will have to deliver on consistency. Consistency of product. Consistency of design. And consistency of experience.
To the question of where the airline can compete effectively and position itself, what Air India does have going in its favour is the long-haul market or flights that are in excess of 5 hours. In this segment, customers, especially business customers, will pay a premium for comfort and reliability. And increasingly, they will pay a premium to avoid transferring over a hub airport whether it is in Dubai or Singapore or some point in Europe. This market is also wide open for Indian airlines because with the grounding of Jet Airways these flights are now only flown by Vistara and Air India. Of course, this means competing with the likes of airlines such as Emirates, Qatar and Singapore Airlines but it is not a challenge that India’s heritage and hospitality cannot surmount.
But underneath all of that, the airlines costs have to be competitive. And on that front Air India is found wanting. Consultants that peddle a narrative that a higher cost does not matter as long as it is covered by higher revenues fall into a trap of misreading the market and walking away with non-actionable advice. This is an area that Air India will have to navigate carefully.
The Brand Challenge
The brand challenge for Air India will also be driven by the fact that the ecosystem is fast evolving. Traditional means just don’t work. One sees Air India advertising on TV, on metro stations and on trains but this overlooks the fact that the phone screen has become integral to the decision-making process. Thus the content, the design and the ease of use of screens will need a relook. The Air India app, the website and social media accounts as they stand today are not even an option.
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Finally the brand refresh will have to incorporate feedback channels. Indeed, for every advertisement that is put out and for customer experiences both good and bad, there is now instant validation. In forms of customer reviews, feedback, posts on social media, photographs and complaints. Brands in that sense are no longer what you say about yourself. They also encompass what others say about you, what you say about others and what others say you say about them. Put this in the context of Air India and ask consumers, suppliers and employees for feedback and it will be an uphill climb.
As Air India stands ready for disinvestment, purchase behaviour does not point to the brand delivering on a premium experience, on price or on value. Couple that with a weak loyalty programme and confused positioning and managers have their work cut out.
For Air India, the burden of legacy continues. Revitalizing and repositioning the brand can only be achieved via sticking to core values, via delivering consistency and via a clear and well-articulated value proposition. Failing that the customer simply has too many options. And every customer that the airline loses is one too many.
Satyendra Pandey is the Managing Partner at aviation services firm AT-TV. The views expressed in this article are those of the author and do not represent the stand of this publication.
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