Abstract
The current literature review dwells on the success of Etihad Airways and assesses the current situation. The author provides evidence concerning the critical acclaim of the company. This literature review focuses on the factors that majorly contributed to the accomplishments of Etihad Airways. The paper emphasizes the importance of the marketing strategy chosen by the company and its tactical approach to providing excellent customer experience and high-class services.
This literature review discusses the reasons that are implicitly related to Etihad Airways’ accomplishments and provides relevant examples from different areas of practice to support the hypotheses. The author pays close attention to the important peculiarities of the aviation business and compares the business models of other companies to the business model of Etihad Airways. The main objective of the current literature review is to analyze the background of the carrier business, logically associate Etihad Airways with its competitors, and realize the limitations of the current strategy of the company that might be revised in order to extend the company’s customer base and income level.
Introduction
The economic background of the United Arab Emirates is characterized by constant growth and improvement. Throughout several decades, the country was able to get to the top positions of various lists. The UAE became one of the most popular tourist destinations. This allowed the country to develop its financial state, and its major success is mainly caused by the correctness and adequacy of the chosen strategy.
As a tourist destination, the United Arab Emirates had to take into account the presence of airlines that would provide users with quality service. The current literature review concentrates on Etihad Airways, its economic and marketing strategy, customers’ response to their approach, and overall success of the company. It also comprehensively answers the question of whether the company is economically stable and complies with the customers’ wishes and needs. The main objective of this literature review is to assess the current condition of Etihad Airways and discover the downsides and limitations of the company’s marketing and customer experience strategies.
Literature review
Middle Eastern air companies are changing the undercurrents of intercontinental air travel as Etihad Airways, Qatar Airways, and Emirates are rapidly developing as the new worldwide contenders (O’Connell, 2011). The UAE’s airports are similarly experiencing a rapid renovation to keep consistent with the exponential traffic flow progress that is projected. The persistent evolution of the Emirates has to be thoroughly reviewed.
O’Connell inspected the numerous approaches that supported the essential competencies, which were in charge of its two decades of successive productivity (O’Connell, 2011). The author stated that the fundamental formula for the UAE’s efficiency should be mainly attributed to its actions, competitive cost organization, and the robust influence of its brand (O’Connell, 2011).
The next study examined the financial and environmental effectiveness of 27 international carriers in 2010 (Chang, Park, Jeong, & Lee, 2014). An all-embracing environmental measure statistics envelopment investigation model with the feeble dispersibility hypothesis was elaborated to evaluate the efficacy of the air companies. Etihad Airways proved to be generally more well-organized, trailed by European and American carriers.
The researchers found that mediocre fuel consumption is the key source of ineffective airlines both in financial and ecological aspects (Chang et al., 2014). This study dwelled on the rivalry between Etihad and numerous European and American airlines.
The topic of rivalry is also thoroughly discussed in the study conducted by Vespermann, Wald, and Gleich. They believe that by reason of deterring their economies away from deteriorating oil assets, some Middle Eastern republics follow the path of considerable investments into their airways. The majority of these funds focusses on the UAE and Qatar and includes fleet extensions strengthened by immense airport extensions and expansion plans (Vespermann et al., 2008).
Subsequent to an evaluation of the present growth tendencies in the Middle East, the authors of the study examined the effects of this progress on aircraft patterns along with the impact on the incumbent carriers and airport workers. Moreover, the grounds for the potentially premeditated response were presented. The results of the study were consistent with Chang et al.’s (2014) and showed that Middle Eastern air companies would soon become strong international opponents to the well-known carriers (Vespermann et al., 2008).
While there was no appropriate local demand, these air companies’ intention was to redirect the intercontinental traffic from the Old World and the Americas to the Middle East. Consequently, the key companies chiefly in Europe and the Middle East would be impacted directly. Nevertheless, the outcomes of the study also specified that (for some markets) Middle Eastern airlines were disapprovingly located concerning limitations like trip time and required transfer flights (Vespermann et al., 2008).
The issue of inadequate flight times and numerous transfers are also reviewed in Reynolds-Feighan’s (2012) study. He inspected the major Asian, Middle Eastern, North American, and European air cargo systems. In his assessment, he used the combination of the data concerning the relations between customers, cargo, and all-freight air companies. The author used the data set that comprised the statistics for the last 15 years (Reynolds-Feighan, 2012).
He also managed to examine some of the significant tendencies that have formed and categorized air cargo markets throughout the last two decades. The effect of air transportation market liberalization is acknowledged as the main factor of varying carrier behavior, mostly regarding the system structure organization (Reynolds-Feighan, 2012). The second major target was to scrutinize the sources of evidence accessible to tracing the tendencies in the air cargo sector.
The altering nature of the business organization was debated, and the key companies in each area were distinguished (Reynolds-Feighan, 2012). The monetary assets of the main air cargo centers were examined over an identical time period. This study is consistent with the vital driving aspects in indicating the future path of Etihad Airways in the next ten years. Merging in the commercial airline business and the importance of the united carriers are still to be considered (Reynolds-Feighan, 2012). This study is consistent with O’Connell’s (2011) research due to the absence of all-inclusive datasets specifying the actions of the integrated air companies.
A particular event that majorly impacted the development of Etihad Airways was the Eyjafjallajökull Volcano eruption. In 2010, it caused an overall loss of nearly two billion dollars for the air travel business (Balakrishnan, 2011). The research dwelled on the effective leadership practices that helped the company survive through the slight recession and get back on the track. Moreover, this study reflected the way Etihad, one of the top airline companies worldwide, coped with the crisis and continued to gain knowledge concerning the methodology of dealing with the crises in the future (Balakrishnan, 2011).
The airline companies are ubiquitously relying on the market needs and customer experience. Laming and Mason investigated the utilization of the perception of customer experience to the commercial airline industry and the degree to which air companies were providing decent customer service. The study exposed that the idea of customer experience was not well recognized and had had no clear and reliable explanation (Laming & Mason, 2014).
The determination of customer experience is acknowledged as to bring gratification through the customer experience that, in sequence, generates the allegiance and trust in the customers. In order to measure the performance of the customer experience concept, research was conducted exploiting the comprehensive data gathered over a one-year period from nearly 19,000 travelers on fifteen chief full-package commercial airlines in the Middle East, Europe, and Asia (including Etihad Airways) (Laming & Mason, 2014).
The essentials of the carrier passenger trip most sturdily associated with overall fulfillment, trustworthiness, and support were, for the majority of air companies, cabin assets surveyed by the team (for fulfillment) and onboard food and beverages (for loyalty and advocacy). The examination did not recognize any robust effects from the influence of carrier location, specific air company, and flight class (Laming & Mason, 2014). The main finding in relation to the Etihad Airways was that the connections between the travelers’ fulfillment ratings for definite elements of the trip and the general fulfillment, trustworthiness, and advocacy were not impacted by flight class.
Etihad is known as a quickly developing player in the flight business and has converted into one of the leading intercontinental players in the business in a comparatively short period. Etihad’s fleet now holds more than 70 airplanes, with over 1,500 flights weekly to miscellaneous locations all over the world (Al-Ali & Ahmad, 2014). The corporation defines its business approach as maintainable development. It is stated that premeditated companionships have been the most important actions by means of which Etihad had conveyed its strategy. The research conducted by Al-Ali and Ahmad particularized its key partnerships and the vital welfares of those.
Along with the partnerships, Etihad Airways is a pioneering company that is not afraid of innovation. Etihad developed lounges for children as a kind of marketing strategy which subsidized its attractiveness and demand. This innovation is a part of the development of the youth department agendas which contribute to its attractiveness (Cole, 2011). The physical indication market policy exploited by this company has formed customers’ responsiveness to this carrier and their facilities. This includes the onboard entertainment systems, diverse menu for its clients, and a large aerodrome layout. Numerous advertising strategies implemented by this company have allowed it to infiltrate into the worldwide market and conquer the trust and loyalty of its customers (Cole, 2011).
The commercial trials that air companies and airports encounter in the period of international financial variability are intricate and rather diverse. This has given Etihad Airways and the emirate’s administration the chance to reassess their core methods and strategies (Al Katheeri & Ocler, 2013). These units are now required to obey the novel premeditated paths with the aim of conquering the newly competitive market. Etihad Airways is concentrating on gaining growing devotion to the brand and is utilizing a strategy of collaboration, which the carrier wants to produce in order to decrease hesitation, division risks, and overall costs (Al Katheeri & Ocler, 2013).
Currently, it is obvious that any air company business has to reply to the current business situation, while exposed to the upsetting fails, devastated customer confidence, and collapsing profits (Nataraja & Al‐Aali, 2011). However, Etihad Airways testified remarkable growth and surprising revenues while their competitors faced unbearable losses. Nataraja and Al-Aali’s (2011) research investigated and scrutinized the competitive benefits of Etihad Airways. The key discovery was that the design and application of proper policies had led to the brilliant performance, productivity, and success of Etihad Airways (Nataraja & Al‐Aali, 2011).
The competitive tactics – such as functioning strategies, common strategies, and modification strategies – can be of profit for any company that wants to surpass its opponents. Similarly, the ability to control, revolutionize, and develop new concepts, along with a visionary administration crew, are indispensable for the excellent performance of an Etihad Airways (Nataraja & Al‐Aali, 2011).
Conclusion
Etihad Airways is one of the most successful air companies worldwide. This literature review found extensive evidence to that fact and comprehensively described the current market situation and Etihad Airways’ role. Owing to numerous factors, such as customer satisfaction, pioneering approaches, and quality service, the company is on top of the charts and is determined to keep pushing forward. The current literature review extensively describes the present state of affairs in Etihad Airways and concepts that relate to the profitability of the business. According to the statistical evidence, customer experience should be considered the main driving factor of the success of Etihad Airways. There is still room for improvement, but a thorough reassessment of the current values and strategies is required.
References
Al Katheeri, M., & Ocler, R. (2013). The relationship between strategic planning and suitable growth: A case study in luxury airline industry. International Journal of Sustainable Human Development, 1(2), 65-70.
Al-Ali, H. A., & Ahmad, S. Z. (2014). Etihad Airlines: Growth through successful strategic partnerships. Emerald Emerging Markets Case Studies, 4(5), 1-17. Web.
Balakrishnan, M. (2011). Etihad Airways: Reputation management – an example of the Eyjafjallajökull Iceland Volcano. Emerald Emerging Markets Case Studies, 1(4), 1-17. Web.
Chang, Y., Park, H., Jeong, J., & Lee, J. (2014). Evaluating economic and environmental efficiency of global airlines: A SBM-DEA approach. Transportation Research Part D: Transport and Environment, 27(11), 46-50. Web.
Cole, A. (2011). Analysis of the Etihad Airways. Business Economics and Marketing Research, 3(1), 1-17.
Laming, C., & Mason, K. (2014). Customer experience — an analysis of the concept and its performance in airline brands. Research in Transportation Business & Management, 10, 15-25. Web.
Nataraja, S., & Al‐Aali, A. (2011). The exceptional performance strategies of Emirate Airlines. Competitiveness Review, 21(5), 471-486. Web.
O’Connell, J. F. (2011). The rise of the Arabian Gulf carriers: An insight into the business model of Emirates Airline. Journal of Air Transport Management, 17(6), 339-346. Web.
Reynolds-Feighan, A. (2012). Comparative analysis of air freight networks in regional markets around the globe. Global Logistics: International Series in Operations Research & Management Science, 2(1), 325-366. Web.
Vespermann, J., Wald, A., & Gleich, R. (2008). Aviation growth in the Middle East – impacts on incumbent players and potential strategic reactions. Journal of Transport Geography, 16(6), 388-394. Web.