Air Deccan the low cost airlines (LCC) had sought to position itself as a common man's airline by bringing it itself closer to the target audience with its scheme of announcing fares for just Re. 1 that continued for long. The Managing Director, Capt. G. R. Gopinath, offered four or five seats in every Airbus at this rate. He said the flights offered fares, which were as low as Rs. 500, and 40 per cent of their seats were priced below Rs. 2,500. The one rupee reservations could be booked 90 days in advance. This excluded Rs. 221, which was collected for security payment by the Airports Authority of India. Air Deccan, in the 18 months of its existence, had flown more than a million passengers with a fleet of 17 aircraft and 111 flights a day. Nearly one lakh passengers had flown paying Rs. 500. Air Deccan had captured a market share of appx. 18% (see table below) in the 2006 and 2007. It had received approvals to fly to designated 13 international destinations, which included the US and the UK and short-haul destinations like Singapore, Hong Kong and West Asia and after completing five years of domestic operations. Seven weekly flights were flying from Bangalore to London. Air Deccan had good planes, crew and infrastructure.

(Refer: Air Deccan the first low cost air carrier of India Pg. 51 to 62- Theory and Practices of case Method of Instruction – Prof. B Bhattacharyya, IILM- Excel Books publication)

Due to financial difficulties faced by Air Deccan, the LCC airlines decided to merge with Vijay Mallya’s (United Breweries) full service airline Kingfisher In 2007 and Air Deccan changed to Simply Deccan. Kingfisher, after completing its merger with Air Deccan, aside from other strategic reasons would leverage the Deccan license, which meets the stipulated five years of operations to fly overseas, but use its own brand to fly international routes from September, 2007 and gradually replace it in the domestic market too. Sources close to the development said the international routes will have only full service operations, but the Kingfisher brand on the domestic routes will incorporate two models under one brand — a full service carrier and a more upgraded LCC service. In 2006, Jet Airways, the country’s largest private carrier, bought full-service carrier Air Sahara, renamed it JetLite and repositioned it as a value carrier.

Several airlines have tried differential positioning after mergers and acquisitions. The merger of state-owned Air-India and Indian Airlines created a new company, Air India, for domestic and international operations that use the same brand. Air India also, however, has a low-cost international brand called Air India Express.

Along side the mega rebranding of Hutch to Vodafone, another high profile rebranding in the year 2007 was witnessed - Kingfisher undertook a Rs 2,500-crore branding exercise of Air Deccan that aligned the brand more closely with Kingfisher. For instance, the trademark Kingfisher bird was added to the Deccan logo of two hands and the airline’s signature colour of red was incorporated into the Deccan aircraft instead of the earlier Deccan colours of yellow and white.

Crew uniform and livery were also changed accordingly. Meanwhile, sources from the travel portal industry said that Kingfisher has already shifted to the Sabre ticketing platform, Deccan is also looking at shifting to the same platform.When the media announced that Kingfisher had taken control over Air Deccan, one thing that popped up in the mind of a marketer was about the brand " Air Deccan".How would Mallya treat Air Deccan was the million dollar question?. One thought that Vijay Mallya would keep the two brands in two different platforms. How dare one can even think of integrating a low-price brand with a lifestyle brand ? Did it mean that Mallya would try to cut unprofitable routes , may tweak a little with the level of service at Air Deccan but keep the brand at arm’s length from Kingfisher?

But what Mallya did with Air Deccan was different. from the brand name, the logo, positioning and all the brand elements. Air Deccan is now “Simplify Deccan “. The earlier logo of Hands has paved way for the Kingfisher logo. The color of Yellow and Blue changed to Red. The old tagline integrated to the new Brand name with the new positioning statement “The Choice is Simple".The rebranding exercise cost Mallya around Rs 15 crore (media spend).

The rebranding and the heavy secondary association with Kingfisher was surprising one thought that it is highly risky for a premium brand to be associated with a price warrior brand. So any association of Kingfisher and Deccan could hurt the Kingfisher brand most. and more importantly " Little Delights all the way ".

Market shares of scheduled airlines:

CARRIER YEAR 2006 YEAR 2007 YEAR 2008Indian 22% 19% 16.3%Jet Airways 32% 22.6% 21.5%Sahara (Jet Lite) 9% 7.3% 8%Kingfisher 9% 12.2% 15.4%Air Deccan (Deccan) 19% 17.1% 12.2%Spice Jet 9% 8.8% 10%Indigo 9.5% 11.6%Go Air/ Paramount 3.3% 4.8%

Assignment questions.

• How significant is the new repositioning exercise to the new Simplifly Deccan to the customer? What does it promise?

• Ans >>> Airdeccan has changed completely. From the brand name, the logo, positioning and all the brand elements. Airdeccan is now " Simplifly Deccan " . The earlier logo of Hands has paved way for the Kingfisher logo. The color of Yellow and Blue has changed to Red. The old tagline has been integrated to the new Brand name and the new positioning statement is " The Choice is Simple ". The new Simplifly Deccan is promising many things to the customer in terms of delighting them : Excellence in timely performance: Wider Network and more importantly " Little Delights all the way ".

• Does the new repositioning identify all the weakness of Air Deccan.? • Ans. >>> The new repositioning identifies all the weakness of Airdeccan. There were

constant harping about poor customer service, delays and no free food. In blogs and forums , harried customers aired not so good words about Airdeccan while conveniently forgetting the fact that " You get what you paid for ".

• What breath of fresh air has Kingfisher brought into Deccan in terms of delighting customers?

• Ans >>> Kingfisher has now bought in a breath of fresh air into Deccan. The Kingfisher airlines brand has established itself as a clear leader in delighting the customers by managing the Moments of Truth. Now that promise is being given to Airdeccan customers. And interestingly Mr. Mallya need not do much but just bring in the culture to Deccan. Deccan already have good planes, crew and infrastructure. Bring in Kingfisher culture will be the key change that we are going to see in Simplifly Deccan. The new positioning is also significant. The positioning of " The choice is simple " takes strength from the famous old tagline :Simplifly. It builds on the old platform and aims to be the " preferred airline " for the discerning customers.

• Will Kingfisher brand suffer by associating with a low price brand ? Is it a risky affair?• Ans >>> May be no because price was not what Kingfisher is all about. Whether it is

Kingfisher airlines or the beer, the brand never was an expensive one. The focus was on experience and lifestyle. There can be huge expectations about the new Deccan and people ( including Kingfisher loyalists ) will try out the new Deccan but will see a clear demarcation on the service levels between the two. The Kingfisher experience will be limited to Kingfisher airlines but you will get a teaser of that in Deccan ( that may be the idea). Having said that , this rebranding exercise is definitely a risky affair for Kingfisher brand.