Huge Price Cut on IndiGo Tickets
Saturday, 27th October 2012 at 02:30am
In order to get more seats sold, airlines engaged in a price war during the biggest festival in the country. Air India initiated the move by lowering its regular airfare by almost half its regular price and not long after, Jet Airways countered the move by offering the same amount. Immediately after that IndiGo made its own move by offering up to 40 percent off its regular price if booked at least one month ahead. The third largest carrier, SpiceJet, was expected to follow shortly after.
The massive discounts offered by the airlines were a form of marketing strategy which was designed to draw back air travelers who had stopped flying due to the increasing cost in air travel. The airlines believe that they would be able to increase their ticket sales as Kingfisher Airlines is seen to cease operating this year.
A senior executive from JetAirways thought that offering big discounts on airfares while yield is low might not be a good idea but he maintained that it will not impact their financial health due to the fact that seat capacity across the industry has greatly decreased recently while travel demand is expected to pick up during the holiday season in both domestic and international sectors.
Air India first offered the scheme it called 'Jaldi Jaldi' by slashing 40 percent off its regular airfare on many routes and a day later, Jet Airways quickly countered Air India's promo.
Under the promo, passengers who booked at least 30 days ahead on major routes would be as follows: Mumbai-Goa route Rs 2,970; Mumbai-Delhi Rs 4,931, Delhi-Srinagar Rs 3,516, Kolkata-Delhi Rs 4,818 and Chennai-Port Blair Rs 4,378.
In the same token, IndiGo lured its customers by offering heavily-discounted rates on major routes: Delhi-Mumbai Rs 9,591; Delhi-Bangalore Rs 10,202; Delhi-Hyderabad Rs 9,954; Delhi-Kolkata Rs 9,425; Delhi-Chennai Rs 9,950. The ticket prices already included taxes.
Regular fares on these routes ranged from Rs 6,500 to Rs 9,000.
Industry analysts believed that the promo offerings by these airlines were a good marketing strategy to drum up interest in markets like India where travel market is contracting due to increasing cost of air travel. Moreover, it encouraged the traveling public to travel by air especially those who are on a holiday.
By: Pete Lee.