IndiGo grow through brilliant basics
Guest post from Prasad Narasimhan, Managing Partner Asia
IS NOW 8.20 am, INDIGO STANDARD TIME”
This innocuous announcement from the IndiGo airhostess startled me for its subtle brazenness. And it got me thinking about the success of this amazing budget airline.
India has always had a fuzzy concept of
time. Never a nation paranoid over time or timeliness, India has its share of
caricatures that reflect this easy relationship with time – the cow lying on
the street impervious to traffic, the ascetic meditating for days at end, the
elephant ambling down the market. Time is but a marker in the flow of life.
Indian languages have their own peculiar
phrases to mock the obsession with urgency. From the ubiquitous “Jaldi Kya Hai?”
(what’s the hurry?) in Hindi to the unique Bengali phrase “Ghudiye Aashun” (go
around and come back!), Indian bureaucracy has its rich vocabulary of
procrastination. But the most interesting of all is the moniker that our time
zone has earned – “Indian Stretchable
It is against this backdrop that IndiGo’s success as a budget airline stands out.Started as a budget airline just 6 years
ago, IndiGo has quickly risen to the top. It is already India’s largest carrier
by market share, and the only one making profits. It has gone from success to
success, winning a series of awards along the way. Yet at launch, most people
didn’t give it a chance. Wasn’t the service too basic? Where was the
differentiation? After all, Indians were spoilt by affordable yet full service
airlines like Air India, Jet & Kingfisher.
But the tables have turned. The big brands
are struggling. And Kingfisher has crash-landed, weighed down by competitive
fares and high taxes. Yet IndiGo runs profitably full flights, untouched by the
turbulence around it. How?
It seems obvious in retrospect, but IndiGo
understood that for the business traveler it targeted, real luxury is the luxury of time. Armed with this insight, they
focused all their efforts on improving the basics that customers come to the
category for – being on time, every time. In light of the traditional Indian
indifference to timeliness, this was a bold move.
IndiGo has stuck firmly to its
low-cost business model through good & bad times. Single aircraft type,
high aircraft utilization, paid-for on-board meals, a single flying class with
no-frills service, and optimal use of space (190 seats vs. 150 in full-fare
airlines) are the basic pillars of the business model.
Aircraft utilisation is maximised
by cutting turnaround time. This further reduces fuel burn; and with fuel
prices rising sharply, every bit helps. IndiGo employs far fewer people, with
one of the industry’s leanest work forces. And by not serving hot meals on
board, IndiGo carries no heavy equipment or cutlery, thus lightening the
aircraft and allowing for less fuel burn.
Initially, many marketers scoffed at the
poor differentiation in IndiGo’s offering. After all, it didn’t have one
feature that was different, apart from a swanky new fleet. Management has
however been focused on consistently bettering the basics: on-time performance,
neat aircraft & hassle-free service. They believed that this would give
them distinctiveness, and when delivered well, this distinctiveness would be
seen as relevant, desirable & defensible.
IndiGo is paranoid about time. Their tag
line reads, ‘On-time is a wonderful thing’. They have led industry ‘on-time’
performance every month for the last 3 years. Staff incentives are heavily
skewed to deliver this – they urge passengers to board early to ensure punctual
departures, and even come around collecting trash during the flight to minimize
turnaround time. On-board announcements refer to ‘yet another on-time landing’
& IndiGo Standard Time.
the box, don't think outside it
focused on creating systems that enhance on-time performance. For example, the
ACARS (Aircraft Communications Addressing And Reporting System) automates
flight take-off & landing information, removing the neef for human intervention. Their Leadership
Academy trains all staff on specifically 2 key areas: on-time performance &
hassle free service.
brand is as the brand does
IndiGo realized early the brand is
no different from its people. Hence ‘on-time’ & ‘hassle-free’ are as much
internal mantras as they are external brands. On-time for IndiGo is not just
about on-time flights but also about on-time meetings, on-time salaries, on-time
hiring, promotions, increments, and bonuses. Similarly when IndiGo says
hassle-free, it refers to making the company a hassle-free place to work in. No
wonder IndiGo has been named one of the Top 50 companies to work for in India
and the best in the transportation industry for 4 years in a row.
In conclusion, IndiGo is a truly inspiring example of how being brilliant at the basics can drive brand and business growth.