Karthik S

Governments intervene when markets fail. But markets fail when no challenger is hungry enough to make the incumbents look bad by doing something simple that flyers notice every single time they book.

The policy enforcement is obvious. What is non-obvious is why India's aviation market hasn't produced a brand willing to compete on differentiation that flyers can repeatedly and tangibly feel. 1/3

Mar 19 at 10:36amWeb
Show threadKarthik S5d ago
2/3 Ironically, free selection of seats is not dependent on larger forces like airport crowds (affects boarding experience), airport infrastructure (affects on-time take-off and landing), among others. This was something available to all airlines, an experience fully owned by the airline. As this Hindu Businessline news adds, seat selection also contributed a relatively smaller share in ancillary revenues. Meaning: this could have been a competitive differentiation for an airline brand.
Show threadKarthik S5d ago

3/3 And yet, both IndiGo and Air India have taken the industry to such a situation that the Government had to mandate a rule, something which was a norm a few years ago!

The moment their combined upsell architecture required removing something customers used to have for free, they have crossed from value creation into value extraction.

#regulation #marketing #positioning