Comments on: An Airline That Is Bucking The Trend,Paramount To Expand Fleet and Provide Value Additions

By: Japan Airlines Files For Bankruptcy | aviation, buzzing, economy

Japan Airlines Files For Bankruptcy | aviation, buzzing, economy — Wed, 20 Jan 2010 11:53:00 +0000

[...] tough times. But, other carriers are battling it hard and staying afloat. As a matter of fact, Paramount Airways has aggressive expansion plans lined up. Makes me wonder if Being Small is actually a Good ThingThe [...]

By: Ankit

Ankit — Mon, 30 Nov 2009 15:34:12 +0000

Awesome thoughts Madhav, and from the content u sure know marketing more than me :-)

I second your thoughts completely.What paramount is doing here can be vaguely thought of as a blue ocean strategy.Instead of fighting for the same thing, they are trying to make the competiton irrelavant.They are going where no one else is vying to go and hence they can be the leaders of an unexploited market place.Their profits can also go up since they are the only ones to do it.

as for internet and stuff like that, yes they are short term incentives to attract a lot of eye balls.But, as they say do what do u do with a bang.So, with these services Paramount is becoming a differentatior

By: Madhav Shivpuri

Madhav Shivpuri — Mon, 30 Nov 2009 07:17:17 +0000

Ankit, if I can use my negligible marketing knowledge – a company needs to define what is the market segment, price range etc that one is targeting. Paramount is targeting the non-regular route (South to North-East) which might have some customers and so give it pricing power until there are no competitors.

I think Paramount is trying to do what Southwest airlines did for the US – no frills airlines for non-regular routes, at cheap prices with the following reasongs:
1. That way the bigger airlines do not compete due to less traffic.
2. If other airlines come into fray they would have to go low price to win customers and this place is already taken by Paramount
3. Airlines is a low-interest (marketing lingo) industry meaning, people do not care which airline they travel as long as they achieve their ends (reach destination at cheapest cost).
4. Giving internet access etc., are short term incentives to the customer. Before long all carriers will probably ape this and the advantage will be short lived.

Only time will tell if Paramount will be successful.