Air-India’s Vistara conundrum

Vistara came in at a time that India lacked a premium flying experience – with Kingfisher Airlines out and once market leader Jet Airways on the path of rapid decline, writes business strategist Lloyd Mathias.

By  Storyboard18Sep 10, 2024 8:20 AM
Air-India’s Vistara conundrum
Vistara built itself around some sharp differentiators – targeted at corporate travellers, with service being the cornerstone and epitomised by its tagline ‘fly the new feeling’.

By Lloyd Mathias

The ultimate goal of every brand is to get consumers to like the brand so much so that they choose it over other competitors – sometimes even at a price premium. All brand custodians have this as their objective. Often their ultimate goal.

Yet, every once in a while you have a wonderful brand built painstakingly with all elements in place – good product differentiators; sharp consumer targeting; and effective reach – that bows out unceremoniously. This may happen due to macro factors often beyond the brands’ control, or unanticipated tectonic shifts in industry. An example in the past decade of a great brand that has vanished is Vodafone in India. It got subsumed under VI (Vodafone-Idea) and another – Vistara, is getting there.

To quickly go into Vistara’s origin. Launched in 2016 – by a JV comprising two large conglomerates – Tata’s and Singapore Airlines - it hoped to provide Indian travellers a seamless and personalised flying experience that combined Singapore Airlines efficiency and service excellence and the Tata’s pedigree of reliability and hospitality.

Vistara came in at a time that India lacked a premium flying experience – with Kingfisher Airlines out and once market leader Jet Airways on the path of rapid decline. While Air India, the then state run airline was a full service career, its service was never its hallmark.

Vistara built itself around some sharp differentiators – targeted at corporate travellers, with service being the cornerstone and epitomised by its tagline ‘fly the new feeling’. It had state-of-the-art aircrafts; appealing brand colours - the distinctive logo and the purple and gold palette connoting luxury. It focused on experience, as against functional parameters like efficiency and punctuality. The design spoke the language of premium hospitality – with every element cabin interiors, livery, and music aimed at creating a 5-star hotel experience.

Tata’s acquisition of Air India in early 2022 – spelt the death knell for Vistara. It just did not make sense for the same group to operate two separate airlines with independent teams in the competitive Indian commercial aviation market. Air India being the brand with the rich legacy, launched way back in 1992 and still recognized unofficially as the national career – would inevitably be the chosen one. Also it’s fitting that the Tatas restore Air India to its glory.

The disappointment among Vistara loyalists when Air India officially announced the sunsetting of Vistara by November 12, 2024 was there for all to see. Outpourings in social media likened the happening to the loss of a dear friend. Many recalled their many happy moments flying Vistara, the music playlist, the crew’s attention to detail and personal mementos like pictures with hand written notes presented to them by Vistara crew.

Clearly reflecting that Vistara in its short span of eight years had left its mark, and had almost achieved cult brand status. This partially aided by the fact that top end Indian travellers were so starved of a premium choice in air travel since Jet Airway’s demise. Parallelly the democratisation of air-travel, with regional connectivity through the Government’s UDAN scheme and rapid spread of low cost, bare bones airline travel, have left many longing for the pampering they once took for granted on flights.

However, while the decision has been taken to merge Vistara under Air India here are a few things the Air India management should consider:

1. Use Vistara’s distinct brand identity to front Air India’s premium offerings. So for example Air India’s business class cabins could be called the Vistara class – with all the Vistara elements included.

2. Incorporate elements of Vistara’s design language into Air India’s lounges, loyalty program and higher end offerings. I know, design purists will see this mixing as sacrilege, But by any measure, transferring carefully built equity and brand regard – makes good business sense. Also, important to recognize that the Vistara loyalist may not naturally migrate to Air India, given ‘low-cost’ airline Indigo’s imminent plan to create a premium segment and a loyalty program.

In a little over two years since the Tata acquisition, Air India has still not emerged from the woods, with tales of lackadaisical service and chronic inefficiency still rampant. The ‘grace period’ from Air-India’s sarkari past, that passengers allow for is over. This Vistara merger could well be the much needed boost, to help Air-India turn the tide.

Moreover, a group like the Tata’s that runs the Taj Hotels – combining luxury (Taj Palaces & Resorts) with less frills and everyday functionality (Vivanta & Ginger) should be able to handle this seamlessly.

Lloyd Mathias is a Business Strategist and an Independent Director who was a leading marketer at PepsiCo India & CMO of Motorola and HP Asia-Pacific.

First Published on Sep 10, 2024 8:20 AM

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