1. Positioning the Carrier in India Shivani Pal Mansi Baranwal Aditya Mukherjee

2. Driven by increase in tourism and disposable income, outbound aviation sector has grown ~4X Introduction of low cost outbound airlines and rising disposable income Growing international trade and international tourism industry Open sky policy Exports grew at at a CAGR 14.76 per cent between 2009- 10, Imports grew at a CAGR of 17.91 per cent Bilateral agreements with foreign countries 123 Growth Drivers

3. The government is taking steps to encourage air travel and meet infrastructure deficits Aviation Sector in India Growing air traffic Increasing scheduled air services Growing investment for developing airport infrastructure Enhancing ecosystem Strong focus on safety Domestic passenger traffic is estimated to reach 150–180 million by 2020, while international passenger traffic is expected to grow to around 50 million by 2015. In 2009–2010, scheduled air services are available between 82 airports as against 50 in early 2000. The Airports Authority of India (AAI) is upgrading and modernising 35 non- metro airports in the country at an estimated cost of around US$ 1 billion (INR 46.6 billion), as well as modernising the airports of Chennai and Kolkata. In 2009, only 1accident per 1.4 million flights was recorded, making airlines the safest way to travel. Under the revised Eleventh Five Year Plan (2007–2012), the Government of India (GoI) estimated an investment of around US$ 7.5 billion (INR 361.3 billion) for the development of airport infrastructure. Source:* ―Performance of Select Industries,‖ Department of Industrial & Promotion website, http://dipp.gov.in/industry/content_industries/index.htm, accessed 25 January 2010; Ministry of Steel 2008–09 and 2009–2010 annual reports; ―Sector focus: Civil aviation,‖ Indian Infrastructure, October 2010; Ministry of Civil Aviation 2009–2010 annual report.Airports November 2010

4. HorizonNeighborhoodPure BizSpecial Routes US, EU SE Asia, Middle East Russia, China, Japan Pakistan, Saudi Arabia, SE Asia Less families, affluent, biz & leisure Family holidays, price-conscious, biz & leisure Almost purely business travel Pilgrimage, Islamic commerce, income variation Business Labour Low end holidays High end holidays The Indian international travel market can be segmented based on routes New evolving passenger routes from India: -Jordan, Greece -Turkey, Egypt -Macau, Bermuda -Scandinavian countries India Most large business destinations like US, Europe, Singapore, UAE are also leisure travel spots Additionally, high overlap between distance and affordability; thus we segment existing routes as: There is also emergence of new travel routes for leisure These routes set to grow; flights, load factor remain low

5. Italy, France~ 3% each Switzerland, UK~ 6% each US~9% Analysis of destinations shows high attractiveness of Horizon and Pure Biz Source:* ― Outbound data and primary calls helps us size and break the 4 segments Clearly showing the attractiveness of Horizon and Pure Biz segments Horizon (excluding scattered) total value 28% Business IT, Multinationals, Family biz, affluent Leisure Elderly rich, couples, less families, luxury vacations Australia, HK, Thailand~ 4% each Singapore (excl. labor, SR)~ 4% UAE (excl. labor)~3% Neighborhood (excluding labor) total value 21% Business IT, Multinationals, Family biz, wider income range Leisure Families, couples, first-time travelers, wider income range China~ 2% Japan~ 2% South Korea~1% Pure Business total value 5% Business IT, Multinationals, Family biz, affluent LeisureNegligible Malaysia, Pakistan~ 1% total Singapore (percentage)~ 1% UAE (percentage)~1% Special Routes total value 3% Business Islamic commerce, family biz, wider income range Leisure Pilgrimage, family ties, wider income range Emirates primarily targets Quality seekers being a premium airline Thus, it has to strongly target Horizon and Pure Biz routes However, it should also be competitive in the large Neighborhood segment 1 2

6. Emirates core capabilities can be used to create competitive advantage for Indian consumers Source:* ― EMIRATES CORE CAPABILITIES The Dubai Advantage Geographical and route wise center of international travel from and to India Home turf advantages due to ownership – Dubai visa services, Stop over packages Expertise in oil price hedging Emirates Group Advantage Group consists of companies providing ground services, cargo, catering, hospitality & tour packages – bundling opportunity Deep Pockets Equity investment by the Government of Dubai Useful for initial market penetration & loyalty PROFILE OF A TYPICAL INDIAN TRAVELER LEISURE BUSINESS Value conscious Like to get freebies Information asymmetry allows marketing to play role in choices Will spend money if it makes them look better amongst peers Like Indian food Travel heavy Like to splurge on corporate money Will spend money if feel pampered Large disposable income – impulsive buyers. Want to feel powerful and respected Most are 1 st /2 nd gen urban

7. Differentiated strategy will allow domination in Horizon, Pure Biz; compete in Neighborhood Source:* ― HORIZON 1.Higher travel agent incentives in India Agents have perception of Emirates undercutting them 80%+ of international tickets booked through agents 2.Combine flight packages with Dubai shopping incentives especially during DSF or discount hampers for gold, electronics, etc 3.Promote the flight as an ’experience’ of staying in a five star hotel for the long flight duration – not just a transition but destination 4.On board travel agent services – rail pass, calling card, forex, tour plan, travel cards etc. Travelers can just pack bags, get visa and come 1.Higher travel agent incentives in India Agents have perception of Emirates undercutting them 80%+ of international tickets booked through agents 2.Combine flight packages with Dubai shopping incentives especially during DSF or discount hampers for gold, electronics, etc 3.Promote the flight as an ’experience’ of staying in a five star hotel for the long flight duration – not just a transition but destination 4.On board travel agent services – rail pass, calling card, forex, tour plan, travel cards etc. Travelers can just pack bags, get visa and come 1.Price is the basis of competition Need for disguised air fare discounts in packages as actual fare reduction works against brand value and long term margins Marketing should justify price differential as an extension of the holiday onboard Emirates – first holiday destination 2.New unexplored destinations with holiday packages e.g. Jordan 1.Price is the basis of competition Need for disguised air fare discounts in packages as actual fare reduction works against brand value and long term margins Marketing should justify price differential as an extension of the holiday onboard Emirates – first holiday destination 2.New unexplored destinations with holiday packages e.g. Jordan 1.Position companies booking Emirates for their employees as caring 2.Corporate travelers want to splurge on company money Gift hampers covered in ticket price On board spa, chocolates, lounge, destination etiquettes video 1.Position companies booking Emirates for their employees as caring 2.Corporate travelers want to splurge on company money Gift hampers covered in ticket price On board spa, chocolates, lounge, destination etiquettes video NEIGHBORHOOD PURE BUSINESS “Staying at the 5 star Emirates” “Just pack your bags..” “Holiday starts in the 5 star Emirates” “Because your company cares”

8. Growth of SE Asian countries such as Malaysia, Thailand as tourist destinations Increasing lobbying by competitors in core home markets ( India, Canada, Australia, Germany) Aggressive growth plans of other Gulf-based carriers; Qatar Airways and Etihad Airways Core capabilities for countering environmental & competitive threat Our recommendations help counter the threat of low cost carriers Cost advantage Competition in Neighborhood segment New form of low cost carriers Threats to be countered include entry of LCCs into Neighborhood segment; Regulatory issues Well-established Innovations LCCs which attach social significance to experience Leather seats, video games, XM satellite radio As mentioned, cost advantage has to be countered without diluting brand value: Disguised lowering of prices in packaged tours and Dubai shopping vouchers Getting travel agents to push Emirates Justifying the cost differential as extension of holiday experience SE Asian countries not geographical centre for Horizon flights Leveraging deep pockets, elite brand and Dubai’s support

9. Emirates India can build sustainable advantage as a premier outbound carrier Source:* ― The recommendations we’ve given are direct actions Emirates India can take to gain market share. However, to build sustainable advantage over the long term we recommend the following organizational structure : Central Management Central Strategy India Management India OperationsIndia Strategy India Market Research The inherent advantage Dubai and the Emirates Group gives Emirates India, and the importance and growth potential of India as a market, leads us to propose a direct link between Emirates India’s Strategy team and Central Management in the UAE