Amidst reports of the honeymoon period between Kingfisher and Deccan coming to an end, is the question: can merger of two distinct brands work? The bone of contention seems to be the brand positioning of Deccan and retaining of the brand name. In my view, Deccan had a sharp positioning and a great vision. The ‘common man’s airline’ and the vision of converting the mass of train travelers to air travelers is a promising one. But the airline’s operational troubles and perception of poor service dimmed the halo around it.
A related poser would be: can an airline in India be a true Low Cost Carrier? In an interview to The Economist, Naresh Goyal of Jet Airways said: ‘ low-cost carriers are not feasible in India. The country lacks the infrastructure and readily available skills to be had in Europe. “Here there are no alternative airports,”. “India has nothing called low-cost, only low-fare and low-margin. This is irrational pricing which will make the whole industry sick.” Therein lies the rub. Will the Deccan model be viable in the long run? Kingfisher does not seem to think so. According to DNA, Vikram Malhotra, head of marketing, Kingfisher Airlines said: “Deccan is synonymous with lowest-cost travel, and this was pulling it down because the approach attracts only bargain hunters, not loyal travellers. This brand legacy needs to be stripped off to start making profits”.
The current scenario would only mean that the existing airlines fight for the same pie and not really expand the market. The growth of the industry is likely to come from luring first time travellers and keeping them loyal. But the Catch-22 situation is about being able to afford those huddled masses. Mallya’s full-service carrier seems to focus on the metro cities’ prime slots and the business traveller, while the low-cost airline is mostly catering to non-metro cities. Is that a sharp enough differentiation? I doubt it. I think Deccan’s outlook to the business was truly visionary. Sadly, for the consumer it is yet to become a reality.