On August 30 ,2008, Kingfisher officially announced the rebranding of Simplifly Deccan to Kingfisher Red. It marked the end of a wonderful brand which rewrote the aviation industry in India.
Air Deccan was India's South West Airlines. It made air travel affordable and many Indians had a chance to experience traveling in a plane. Now i
t is a part of history.As a marketer , I am upset at the demise of a wonderful brand. As a consumer I worry that I will not be able to have an affordable air travel. Without Air Deccan , air travel will not be the same again. Its back to the earlier days where flying will be restricted to rich and those who travel at their employer's expenses.
When Kingfisher took over this brand followed by rebranding it as Simplifly Deccan, I thought that Air Deccan will emerge as one of the best low cost carrier in India. I did not believe media reports that Kingfisher was only looking at the overseas flying license.
Now I feel these reports were correct. Kingfisher had the following agenda :
Kill the competition
Gain market share
Get the overseas flying licence.
Many new airplanes and routes.
By taking over Deccan, Kingfisher got a larger marketshare to fight Jet Airways. More over Air Deccan was creating huge problems for full service airlines. By taking over and killing this brand,Kingfisher has made life easier for all airlines.
For Captain Gopinath, its life as usual. As an entrepreneur , he has built a business, scaled it and then sold it at a best price.
The problem for Air Deccan was that it went public too early. When the companies become public, its operations are guided by the quarterly reports and stock markets. Stock markets never understand the logic of long term sustainable business models. If the quarterly results are bad, there is media / investor frenzy calling for blood.
For Low cost carriers, one cannot survive by looking at quarterly results. The business may bleed for long before attaining break-even. Especially in Indian aviation industry where there is still confusion in terms of policies.
For a consumer, the death of this brand is a huge loss. Its visible also. All airlines have jacked up prices, cut many routes and scaled down their operations. This has prompted many consumers to depend on Railways again. If Air Deccan was alive, it could have rode this season with lower prices. That's what a low cost airlines will do when every airlines increase their prices.
Kingfisher Red will not play the game of Air Deccan. It will be a flanker brand that will fight Jetlite. But never will you be able to fly at reasonable rates.
Related brand
Air Deccan
acquiring of air deccan by kingfisher is really bad from the consumer point of view.but don't u think indigo, spice airlines is still in existence so consumer can rely on it.
ReplyDeleteramesh..dont think indigo and spicejet share the vision that gopinath had for air deccan... both of them have not benefitted (or) taken adveantage of air deccans demise...
ReplyDeletepersonally im still attached to AD...it made my honeymoon possible..(i cpuld spend lots of money in a luxury hotel) as opposed to paying a chunk in travel...
its all long lost... when did one fly in AD for the low cost it touted? its all gone long back... the demise is sad for sure but it was expected... consolidation is a phase and in the airlines industry it has arrived.. so AD ...RIP !!!!
ReplyDeletejust a question...
ReplyDeleteDoes a takeover or a merger mean that the brand has failed. If so, why?
Because i thought Air Deccan in this case was doing well and as you have mentioned in the blog it added a whole new dynamics to the aviation industry as such. Was is it struggling in the business it was? I don't think so. So somewhere down the line i am puzzled to see the brand about which you have talked so highly in the post under the failed brand label..
Can you explain.
Extremely troubled by your veiws in this article..
ReplyDelete1. Why would you assume that Kingfisher would never re-brand, never remove the name? Kingfisher and Air Deccan ca never belong to the same company...It would create a classic case of brand dilution. Kingfisher is class, Air deccan is affordable... Class is never affordable... Very few brands can hit that spot.
2. As a consumer who also works in the industry, Air deccan's death will only work for the collective good. Air Deccan went public cause of the ridiculous prices and it inablity to make profit at that. It is a bleeding industry.
3. Air Deccan was not South West Airlines. Low frills does not mean only taking away food/ or making a mad scramble for your seat like you do in a bus. South West has built a culture rich in employee engagement and customer satisfaction.
4. The low cost carriers will continue to exist ( like Indigo etc which have taken the real low cost route of reducing ground handling/support/ clearing of waste by passengers/employees etc). It will be a much healthier and sustainable industry now, much to my delight.
5. No way would Air Deccan have survived this period of high ATF, low ATF and issues which the industry is now witnessing. The philosophy of Mr Gopinath was extremly short term in its vision
the line of thought you have put forward in this article disturbs me a little.
ReplyDelete1. Once Kingfisher rebranded Air Deccan as Kingfisher Red, how can you assume that they would only compete with Jetlite (what about Go Air, Indigo and Spice Jet?)
2. The current rise in prices is because of the increase in taxes which were partly because of the increase in ATF prices, and not because of Kingfisher's umwillingness to run flights at low prices. With a reduction of ATF prices, we can again see flights running at cheap prices now. Kingfisher Red, Jetlite, Go Air, Spice Jet and Indigo are all selling Rs.0 tickets as of today.
So i think your argument that the Kingfisher rebranding of Air Deccan is bad news for the consumer holds little water.
Found this post of yours a little irrelevant.
ReplyDelete1. when Kingfisher rebranded Air Deccan, how can you come to a conclusion that there would be no more low cost carriers in the country ann that Kingfisher Red would now compete only with Jetlite? (what about Go Air, Indigo and spice Jet?)
2. It was very naive of you to say that Flight prices increased becasue of the consolidation in the market and unwillingness of Kingfisher to let Deccan remain as a low cost carrier. Increased flight prices were a result of increased taxes and risinf ATF prices.
3. Kingisher Red, Jetlite, Go Air, Indigo and Spice Jet are all offering Rs.0 to Rs.10 tickets on various flights as of today (ATF prices have fallen). So your view that there would be no more cheap flights is obviously incorrect.
I am sorry to say this but your argument in this post holds little water