Warfare in the High Skies

Abstract Etihad Airways and Emirates Airways are two rival airlines operating from the United Arab Emirates (UAE). This proposal looks at several components of a research project designed to look at the elements of their marketing strategies, against the backdrop of their rivalry. The paper provides an analysis of the two companies and compares their marketing strategies.Advertising We will write a custom term paper sample on Warfare in the High Skies specifically for you for only $16.05 $11/page Learn More The paper also presents findings of previous research regarding international market entry and examines the different approaches that may be used by a company looking to establish itself into a foreign land. The paper closes by giving various recommendations to both Etihad and Emirates on how they can advance by learning from each other which may threaten the representativeness of the achieved sample. Introduction Etihad Airways and Emirates Airways a re two rival airlines operating from the United Arab Emirates (UAE). This proposal looks at several components of a research project designed to look at the elements of their marketing strategies, against the backdrop of their rivalry. As can be seen from table 1, the income from the airline business keeps fluctuating. Chart 1 and 2 also depict the results in the table graphically. Table 1: Summary of Airline Profits and Margin Item / Year 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Operating Revenue 291 295 305 328 307 306 321 378 413 452 490 514 Operating Expense 274 279 293 317 319 311 323 375 409 440 474 498 Operating Profit 17 16 12 11 -12 -5 -2 3 4 12 16 16 Operating Margin (%) 5.8 5.4 3.9 3.3 -3.9 -1.6 -0.6 0.8 1 2.6 3.3 3.1 Net Profit 8.5 8.2 8.5 3.7 -13 -11.3 -7.6 -5.6 -4.1 -0.5 5.6 5 Net Margin (%) 2.9 2.8 2.8 1.1 -4.2 -3.7 -2.4 -1.5 -1 -0.1 1.1 1 Chart 1: Summary of Airline Profits and Margin Chart 2: Trend of Changes over the YearsAdver tising Looking for term paper on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More Aims and Objectives The aim of the study is to determine the factors affecting the choice of market entry models in the international market. Emirates Airlines and the Etihad Airlines have managed to break into international markets despite bitter domestic rivalry. This makes them the best candidates for the study. The objectives of the study will be as follows. To investigate the market entry models of Etihad Airlines and the Emirates Airlines. To investigate the defining elements and the implications of the rivalry between the Etihad Airlines and the Emirates Airlines. To determine the long term prospects of the two airlines in relation to their existing marketing strategies in the context of their rivalry Justification for the Topic Etihad Airways and Emirates Airlines are bitter rivals in the airline sector in the UAE. The two airlines have been competing for market share since the establishment of Etihad Airlines. The significant difference between these two airlines is that Etihad Airlines is much younger than Emirates Airlines. Despite this, Etihad Airlines is proving to be a strong competitor for leadership in the UAE airspace. The main question this leads to is â€Å"how can a young company take on an established company and become a fierce rival?† Secondly, â€Å"what marketing strategies do the two airlines use, and how do these strategies contribute towards their success?† Need for the Study The need to study the rivalry between Etihad Airlines and the Emirates Airlines comes from the following reasons. First, marketing determines the success or failure of any business. Therefore, the fact that Etihad Airlines and Emirates Airlines are each successful in their own right makes them ideal candidates for a study in marketing strategy. Secondly, Etihad Airlines has not yet broken even since its inception, and it will take a few more years before it makes profits. Emirates Airlines has been making profits throughout its history. Does this situation stem from the marketing strategies of the two airlines? Thirdly, there is need to determine the long term prospects for the two airlines given their existing rivalry.Advertising We will write a custom term paper sample on Warfare in the High Skies specifically for you for only $16.05 $11/page Learn More Importance of the Study The importance of this study is that it will provide a platform for examining the effectiveness of marketing strategies under a situation of bitter rivalry. The two airlines position themselves as luxury airlines. They also provide services in very competitive routes across the global landscape. Their rivalry can end up with one of them collapsing and the other becoming a monopoly. On the other hand, each of the companies is a target of acquisition by its rival. These issues il lustrate the importance of studying the marketing strategies of the two airlines in order to determine which one is likely to survive in the long term. The proposal aims to provide a good background to understand how the two competing companies operate, and how they can actually take advantage of their strengths to position themselves strategically in the market. Furthermore, the relevant data that will result from this study will be a very useful resource to both companies as they seek to expand their operations. Based on the outcome of this study, the two companies will be able to analyze their marketing strategies and make the necessary improvements where necessary in order to perform better. As the two companies have already made a move to penetrate the international market, this results of this study will provide them with information that is critical for their survival in an international set up. Besides, this study will be a good reference for future market researches or even for existing and potential airline companies. Sources of Information There are three main sources of data for this project. First, the project will examine existing data regarding the operations of the two airlines from literature. The study will also examine research papers written on various aspects of the operations of the two airlines. It will be important to interview people who use the airlines to determine the customer satisfaction indices. Finally, it will be important to study publications by the two companies to decipher their marketing strategies.Advertising Looking for term paper on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More Literature Review Among other things, this section will examine the literature that exists regarding these two rival companies. The information gathered will later provide a good foundation for understanding how these two companies carry out their marketing operations and what the future holds for two. Defining Marketing According to critics, the marketing concept is about producing things that people do not really need and then tricking the customers into buying them through deceitful advertising. However, Shaw (2011) describes marketing as a complete philosophy for running a business, based on the meeting of well researched, well understood, and genuine customer requirements. It is the management process responsible for identifying, anticipating, and satisfying customer requirements in a profitable manner (Shaw, 2011). Apparently, the use of the word anticipating in the definition emphasizes that marketing is a dynamic discipline, where customer requirements. According to Shaw (20 11), successful airlines are those that accept the principles of marketing should provide a framework for all they do, and set out to apply these principles as widely and as rigorously as possible. Background of Etihad Airlines and the Emirates Airlines Etihad Airways, the national airline of the United Arab Emirates, based in its capital Abu Dhabi, made its first commercial flight in November 2003 (Hausmann, Austin Mia, 2009). Since then, the airline has grown faster than any other in the commercial aviation history, currently serving more than 50 destinations in Asia, Africa, Australia, Europe, the Middle East, and North America. Etihad offers the highest standards of service and comfort both on the ground and in the air with world class cuisine, award winning flat beds in its premium cabins and the widest seats in the economy, as well as more than 500 hours of on-demand in-flight entertainment. Etihad operates a young and environmentally efficient fleet of at least 42 aircraft, which is set to continue growing (Hausmann, Austin Mia, 2009). The Emirates group consists of Emirates Airline, Dnata, Mercator, Transguard, and Emquest. Emirates Airline’s divisions include Emirates SkyCargo, and Emirates Destination and Leisure Management, which manages Emirates holidays, Arabian Adventures, and Emirates Hotels and Resorts. According to Hausmann, Austin and Mia (2009), Emirates operates services to 97 cities in 61 countries in Europe, America, the Middle East, Africa, the Indian sub content, and Asia-Pacific. The airplane’s wide bodied fleet comprises over 110 aircraft and it has on order, a further 112 aircraft worth more than US$ 30 (Hausmann, Austin Mia, 2009). Apparently, international sports sponsorship plays a central role in Etihad’s global marketing strategy, as it seeks to develop its profile in markets across the world. Major international sponsorship deals include the Ferrari F1 Grand Prix team, Chelsea Football Club, the Etihad S tadium, Harlequins Rugby Football club, and All Irish Hurling Champions. Etihad is the title sponsor of the Formula One Etihad Airways Abu Dhabi Grand Prix (Hausmann, Austin Mia, 2009). According to Kleymann and Seristà ¶ (2004), Emirates Airlines is reluctant to join a global alliance as its existing relationships with OneWorld and the Star alliance, are providing good benefits and revenue streams. Emirates Airlines is concerned that a global alliance strategy may conflict with the development of Dubai International Airport as an Emirates hub. Apparently, the carrier is not sure that joining an alliance would make it a feeder airline for others. The Market for Air Transport Services Any airline which is to apply the principle of marketing successfully needs a thorough knowledge of current and potential markets for its services. This knowledge should encompass an understanding of the business in which they participate, and of the market research techniques they must apply in order to gain the knowledge they need about the market place. They must be able to identify customers and distinguish them from consumers. In addition, it is necessary for them to segment their markets. Once they have done so, they need to identify and prioritize the requirements of customers in each of the segments. Finally, and most importantly, they must examine their markets in a dynamic rather than a static sense and anticipate future changes in customer needs. To begin with, any airline first has to deal with the question as to which market or markets are to be studied. To do so, it must answer the fundamental question about the business or businesses in which it participates. In doing so, there are two possibilities. The first and obvious way is to define business participation in terms of what the firm does. Thus, it would be easy for an airline to say that it was a player in the aviation business. There is, however, a significant problem in doing so. It will result in a serious under estimation of both the extent and nature of the competition that the airline faces. As a consequence, defining business in this manner is often characterized as marketing myopia. A much better way is to look at the question from the point of view of the needs that the firm is aiming to satisfy and the competition that it faces. A large airline will be working in at least the transport, communication, and leisure areas. These are explained as follows. Transportation According to Shaw (2011), there is a clear economic and, often social need for transport. Those with this need will look for it to be satisfied in an optimum way. Whether use is made of air transport or a surface transport mode in order to do so is less important to them. There are now many short haul routes where surface transport can provide a level of service in terms of comfort and door to door journey times which is as good as or better than that available from airlines. In the future, this form of competition is likely to become even more marked, given the ambitious investment plans now in place in many countries for the improvement of surface, especially rail, transport. Communication Airlines have always assisted people to communicate, as travel allows opportunities for face to face meetings. It should not be assumed any longer, though, that travel is essential for such meetings to take place. The world is under going a revolution based on video conferencing, conference calling, and email. The future will see video conferencing becoming even cheaper, of better quality, and more widely available. More companies are now investing in video conferencing suits for their staff. Also, almost all personal computers are being sold with in built web cameras, allowing video conferencing to come to the desk top. These are all indicators of substantial amount of competition that airlines are already facing from the telecommunications industry. Seemingly, the degree of this competition will increase further in the future, especially during recessionary times when many firms are under acute pressure to save money. Leisure Airlines today are increasingly involved in the intensely competitive leisure industry. Customers have to decide how they will use both their disposal income and disposable time. Disposable income can be used to purchase holidays. It can, though, also be used to buy a wide range of other consumer items. Disposable leisure time can be used for taking of air based holidays. In the same way, it can be used for other leisure activities. It certainly will be if traveling by air becomes a tiresome experience through flight delays and more and more chaotic airport handling brought about by increasing congestion, more strikes and growing security requirements. For leisure travelers, the impact of surface transport competition is likely to be greater still. Besides competition on service quality, surface operators will be able to challenge airlines on price, with both train and bus services likely to become increasingly significant. The customer in such a situation might be the family member who has most influence in travel decisions. International Entry Strategies As companies face maturing markets and stiffening domestic competition, they show a growing interest in cross border initiatives. Many of today’s leading companies are making foreign market entry decisions on a fairly recurring basis whereas others are taking their first steps in this competitive arena. For example, Best Buy, the world’s largest electronics specialist, continues to internationalize, with market entries into emerging markets such as Mexico and Turkey, and mature markets such as the UK (Carpenter Shankar, 2012). The world’s largest company, Wal-Mart, also actively pursues new foreign operations. As of March 2011, Wal-Mart operated 4587 units in 14 countries outside the USA. The most recently entered market was India, where Wal-Mart runs a wholesale operation under joint venture with India based Bharti Enterprises. So as not to be undone by their Western rivals, rising companies from emerging markets such as Tata Motors and Lenovo are also diligently cultivating a global mindset. India based Tata, for example, recently acquired Jaguar/Land Rover, China’s Geely took over Volvo, and Lenovo bought IBM’s personal computer division. The success of these foreign entries obviously depends on the appropriateness of the firm’s post entry decisions, but may also depend on the strategic choice made at the time of entry, as they shape the platform from which competitive advantages can be gained. Here, we will reflect on both the antecedents and performance consequences of some of the most important decisions that have to be taken at the time of entry. These decisions include; country selection, timing, mode, scale of entry, and the level of adaptation and standardization. As observed by Carpenter Shankar (2012), marke t entry decisions are some of a firm’s most risky strategic choices, as international market entry requires a major commitment of financial and managerial resources. For most firms, it remains uncertain as to whether a large scale presence will ever materialize in the hoped for economies of scale. In a similar way, they wonder when it is best to enter a given market or how much a firm should adapt its concept such as brands, products, and store format, to local taste or whether similar entry strategies will prove to be optimal in mature and emerging markets. This uncertainty helps to explain the variability observed in entry strategies adopted by international players, even within the same industry. Considering that entry decisions remain difficult, managers often turn to prevailing practices in the industry to learn which decisions are good, or even best. Competitive entry decisions are monitored closely, providing a significant input in the decision process. However, the wi de variation in the year of entry, in the scale and mode of entry and in the extent of standardization indicates that this does not imply a mere copying of the most popular pattern. Rather, industry rules suggest different entry decisions contingent on external and internal conditions. Besides looking into the above antecedents of these decisions, here are some insights into the contribution of different strategic choices at entry on post entry performance, especially in the longer run. In spite of this growing extent of internationalization, several firms are still struggling to develop the competencies needed to compete in the global arena. Mixed success has been reported when expanding into the foreign markets. Clearly dominating the US retail market, Wal-Mart’s attempts to apply the company’s proven US formula in an unmodified manner to the German market turned out to be nothing short of a fiasco. Moreover, many international companies do not realize comparable mar gins or returns abroad as in their home market, an a few reach break even in their international. For example, the French retail giant Carrefour loses money in many of its European and cross continental markets. In 2010, Carrefour decided to sell off its 61 supermarkets in Singapore, Malaysia, and Thailand, and focus on markets where it is either the market leader or a strong contender. Overall, firms favor countries with a large prospective customer base as such markets offer better opportunities for good returns. As for scale, several potential indicators are used to assess the potential attractiveness of the market. The indicators a company selects are to a large degree driven by the strategic objectives spelt out in the company’s global mission. Some indicators are derived from macroeconomic trends, others from consumer behavior and culture. Colgate Palmolive, for example, views per capita purchasing power as a major driver behind market opportunities. Starbucks looks at economic indicators, the size of the population, and whether the company can locate good joint venture partners. When choosing markets for a particular product, the metrics to consider should depend on the nature of the product and the way local consumers use and perceive this product. Proctor Gamble chose Malaysia and Singapore as the first markets in Asia for roll out of Febreze, a fabric odor remover. Not only were both markets known for home proud consumers, people there tend to furnish their homes heavily with fabrics. A company might also decide to enter a particular country that is considered as a trendsetter in the industry. Kodak, for example, re-entered the digital camera market in Japan precisely for that reason. According to the president of Kodak Japan, what happens in Japan eventually happens in the rest of the world. The critical role of market size in country selection is supported by several empirical studies. Given that there are several measures to proxy market s ize, the selection of the proper variable is important. A study of the Finnish software enterprises found that the size of the software market in the target country was the most important country selection factor, not GDP or per capita GDP. Apart from the current size, also the future growth prospects are a key consideration. For example, the growth of the middle class is an important driver for many grocery retailers to enter emerging economies. Distance is another selection criterion. Like scale, distance is a multi attribute dimension. It encompasses geographical, cultural, economic and administrative distance (Carpenter Shankar, 2012). All of these criteria will determine how similar a prospective host and home market are. In general, the more similar both markets are, the more likely a firm will enter the prospective host market. One way to capture or quantify the firm’s knowledge of the economic and cultural environment is through the notion of near market knowledge. T he near market knowledge concept enables a firm’s understanding of potential new markets is based on the knowledge generated from operating in similar markets. Administrative distance and hurdles also play a role in a firm’s country selection process. Tariffs, trade quota, restrictions on foreign direct investment and preferences to protect domestic competition by prospective host countries’ governments will directly impede a firm from selecting a country as potential new market. On the other hand, when administrative borders erode, cross border diffusion will accelerate. Generally, the importance of distance tends to evolve as the firm gains more international experience. As the firm gathers more internal expertise, it can expand into countries that are geographically or culturally more distant. For example, Starbucks opened its first store in Canada in 1987, Wal-Mart chose Mexico as its first market outside the US for the launch of the Xbox 360 game console (C arpenter Shankar, 2012). When operating in similar countries, it is hoped that relevant knowledge can be transferred from one country to another. Tracking competitors’ moves also plays an important role in country selection. As firms meet their competitors more and more in several different international markets, the mere presence of those rivals can become an important selection criterion. Dynamics of Entry Strategies The impact of an entry decision can change over time. Some decisions will have along term impact, while in other cases their effect will be relatively short lived. Moreover, the importance of certain factors can change as firms grow more familiar with foreign operations. For example, as the firm builds more international experience, the cultural or economic distance to the home country may become less of an impediment. A study of the international expansion paths of US service firms found that as their international experience increases, these firms indeed see k out markets that are geographically and culturally more distant. An important factor in this evolution is the firm’s ability to transfer knowledge across countries. Conventional wisdom appears to be that firms should gradually enter into more remote countries, where each time, one’s knowledge base is updated in a rather incremental fashion and without major shocks. However, at some point, the firm may adopt an alternative strategy to immediately go to a variety of vastly different target markets, in order to quickly enrich its base through a wide variety of experiences. The former corresponds to a waterfall strategy, while the latter is associated with a sprinkler strategy of international expansion. Firms may also adapt their entry mode over time. The drivers that resulted in the initial entry mode selection tend to evolve over time. As a result, the firm may feel the urge to switch its presence mode. Conventional wisdom suggests that firms progressively move to gre ater control modes. For instance, Starbucks initially entered China through three joint ventures covering different regions. Over time, the firm raised its control in three ventures. In 2006, the coffee chain increased its ownership in the North China partnership to 90 percent so that it could achieve greater operational efficiencies and accelerate its market expansion. So far, scant attention has been paid to the dynamics of entry mode choices. The limited research that dies exist has primarily focused on the antecedents of an internationalization mode change and, not so much on the performance consequences. Finally, while previous research has often focused on the scale of the initial entry, interesting research opportunities are present when studying the subsequent evolution in the investments in different countries, especially for companies with an extended country portfolio. Indeed, trade offs have to be made then on where to grow first. This may require divestments in other co untries, even when the operations in the latter are profitable as well. More and more are no longer confined to their local market, but extend their operations across multiple countries. This involves considerable risks, as major decisions with long lasting performance implications need to be made under considerable uncertainty. Indeed, various decisions have to be made when entering foreign markets, including the selection of the target countries, the timing, the scale and mode of entry, and the extent of standardization versus local adaptation. Throughout this section, relevant literature has been reviewed on these decisions. More attention should be given to capture simultaneously the impact of certain variables on both the selection decision and the subsequent post entry performance of the foreign venture. One concern in addressing this challenge is that researchers usually restrict their samples to countries that the firm decided to enter. Typically, information on the firmâ₠¬â„¢s consideration set of countries at the time of the entry decision is ignored, thereby creating potential sample selection biases. Still, one could envision modeling the selection issue and incorporating it in the performance evaluation. By looking simultaneously at an outcome and selection equation, less biased results may be obtained with respect to the relative importance of the various selection criteria. Although the discussion in this section has concentrated on international entry strategies, exist in global marketing are not uncommon. In 2001, Colgate Palmolive sold its laundry detergent brands in Mexico to Henkel, its German competitor. In 2006, Wal-Mart retreated twice in a row. The company first sold its stores in South Korea and then, barely two months later, it also sold its German stores to Metro. Similarly, Nokia, the world’s largest mobile phone maker, decided to stop making phones for the Japanese market in 2008. However, the literature on market exits is much more limited than on market entries. Initially, firm exits were mostly described as failures, with a focus on poor market shares, low profitability, or lack of financial resources. More recently, more strategic motives have also been identified, such as the need to exit because of a lack of a lack of strategic fit, restructuring, and other proactive moves. Within the more resource based view of the firm, divestments are then described as a move towards the core business by getting rid of non core assets, while portfolio theory has focused on how firms may want to realign their country portfolio to optimally exploit market opportunities. In line with the entry literature, the antecedents and performance consequences for the firms as a whole should be investigated in more detail, so that we can learn when exits may benefit the firm or when they made in vain. As such, one should consider both economic costs of exit, including the sunk costs made during entry that will not be reco vered, and the more strategic costs coming from the ties between the subsidiary that has to be divested and the rest of the firm’s network. Market Entry Modes of Etihad and Emirates Airlines One of the approaches that used by Etihad to penetrate new market us is by forming new alliances. One of the major reasons why alliances are created is to strengthen a company’s position in the market. By forming alliances, Etihad will be able to take advantage of the network created by collaborating partners. Eventually, this leads to reduced operation costs. Emirates and Virgin, however, refused to form an alliance based on the fact that they had distinct products and were, therefore, convinced that working separately offered the solution. The two companies felt that the incremental benefits of global alliance membership do not justify the costs involved in joining. When the Director of External Affairs and route planning of Virgin Atlanta was asked about the possibility of his c ompany entering an alliance, he answered that there had been no need to join any alliance so far (Iatrou Oretti, 2007). Apparently, the Director was convinced beyond doubt that the main advantage of not joining an alliance was flexibility, adding that although he could not point to any particular hard benefit, he also believed that by not having to pay alliance subscription fees or dedicate management time to alliance meetings, Virgin had lower costs. The benefits of joining an alliance are outweighed by staying independent. There is no need to consult anyone regarding timetables or fleet schedules. According to Emirates, the most negative aspects of alliances are slow decision making and compromises members of an alliance are required to make, causing them to settle for the lowest common denominator. Emirates further claims that alliances become bureaucracy laden and divert members’ attention from their core business which is considered an unhealthy situation for forward lo oking and progressive carriers. It is, however, assumed that the growing strength of close competitors such as Qatar Airways and Etihad Airways may at sometime influence its future decisions. Even though Emirates prefer to operate in isolation, the airline acknowledges that alliances are good and is, thus, still open to the idea of forming alliances. As explained earlier, Etihad’s performance has been spectacular despite having been in existence for only a short period of time in comparison to Emirates. Clearly, Etihad, is not afraid to venture into new grounds and this explains why its performance is the way it is. It may be necessary for Emirates to rethink their operational strategy. According to Iatrou Oretti (2007), alliance carriers retain a host of bilateral relations with non member airlines and there are several instances of code sharing between members of rival global alliances. Once the shape of global alliances becomes clearer and more stable, and they grow more exclusive in nature, member airlines may find it difficult to grandfather existing agreements at the time of joining or develop new ones with carriers belonging to a different grouping. Furthermore, should existing coalitions proceed towards deeper integration and start achieving meaningful revenue enhancements and cost reductions it would eventually tip the scale in favor of alliances, increasing their competitive advantages and desirability. Such developments could put extra pressure on the unaligned airlines such as Emirates to re-evaluate their approach towards multilateral partnerships. Etihad also markets itself by offering high quality standards of products and services. Etihad also takes advantage of international sports sponsorship to penetrate the global marketing, as it seeks to develop its profile in markets across the world. As noted elsewhere in this paper, major international sponsorship deals include the Ferrari F1 Grand Prix team, Chelsea Football Club, the Etihad S tadium, Harlequins Rugby Football club, and All Irish Hurling Champions. Etihad is the title sponsor of the Formula One Etihad Airways Abu Dhabi Grand Prix (Hausmann, Austin Mia, 2009). In spite of it being a negative approach to forward progression, avoiding alliance membership has bee supported by other airlines as well. This is an expression of the desire to prevent the alliance from taking too much influence over one’s airline. For example, in the aftermath of the failed integration between KLM and British Airways in mid 2000, the Chief Executive Officer of KLM resorted to stressing his airlines capabilities to go it alone, thereby implicitly down playing the absolute need for an alliance with a competitor. During the discussions with British Airways, KLM has successfully continued on the development and profitability of the airline company. Frequently, the reluctance to integrate too tightly was defined with the fact that alliance membership had really nothing to offer or that up to now, the alliance scene is still considered to be too unstable, or less frequently, because alliancing as such was seen as inherently detrimental to the airline. Generally, it is smaller carriers that have been quick to acknowledge integration. As to outright alliance avoidance, non aligned carriers tended openly to justify their choices of avoiding alliance group membership. As noted earlier, Emirates Airlines is still not ready to join a global alliance as its existing relationships with both the OneWorld and the Star alliance are providing good benefits and revenue streams. Emirates corporate treasurer is, however, concerned that a global alliance strategy may jeopardize its chances of becoming the Emirates hub at Dubai International. Methodology Basically, this study will be based on primary and secondary information sources. Firstly, the literature review will be carried out by consulting books, journals, the Internet, and other relevant sources. Secondly, primary data will be acquired by means of questionnaires. In addition, case studies from the United Arab Emirates will be used to complement the practical part of this research. Research Design and Data Collection Instruments The approach for the study will be quantitative analysis. As has already been stated above, questionnaires will be used for gathering primary data. Other techniques that may be useful for this study are interviews and focused group discussions. These data collection instruments are explained in the subsequent sub sections. Questionnaires Questionnaires are the most frequently used methods for data collection. They provide a method of collecting data by asking people questions or asking them to agree or disagree with statements representing different points. Questions can be open ended, where respondents supply their own answers, or closed ended, where they select from a list of provided answers (Babbie, 2000). According to Gillham (2000), questionnaires are rarely ade quate as a research method on their own. Apparently, this is true of every research methods, especially when one is dealing with a complex real world situation. Generally, the format of a questionnaire can influence the quality of the data collected. A clear format for contingency questions is necessary to ensure that the respondents answer all questions intended for them. It is also possible that the order of items in the questionnaire can influence the response given. Before being administered to the study sample, it is imperative to pretest the questionnaires (Babbie, 2000). The items in a questionnaire are constructed to elicit information on attributes, attitudes, beliefs, reported behavior, health status, knowledge, or psychological traits or states. Respondents may be asked to respond to items on a past, present or predicted timescale. Each item might provide a response that is analyzed individually or be one of a number of items that collectively constitute a measurement sca le on some concept or variable. It should be noted that, in contrast to the measurement of physical quantities such as weight, or distance, the process of measurement involved with such composite scales is not direct. A good questionnaire takes time and skill to construct, and its content and structure should be consistent with the research questions or hypotheses of the study. In general, a questionnaire might comprise all close ended items or might incorporate a portion of open ended items. Questionnaires produce quantitative data for the most part though those that include open ended items will generate some qualitative data, but of less detail and much depth than that obtained by an unstructured interview. The principle alternative to questionnaire is the interview. Questionnaires tend to be classified according to their mode of delivery, whereas interviews are classified in terms of their degree of structure. Although questionnaires are self-completed, they can also be research er completed. Although typically administered by post, a self completed questionnaire might be handed to a group of respondents whom the researcher might hand deliver the questionnaires to the respondents’ homes. Questionnaires have the advantage of saving time. They are also less costly unlike interviews and focused groups. However, where questionnaires are used, the researcher does not get the opportunity to provide any clarifications. To deal with this challenge, it will be necessary to ensure that the questions are properly prepared. Any ambiguity will only serve to confuse the respondents. In addition to the general strengths and weaknesses of self completed questionnaires, there are some specific advantages and disadvantages of postal administration. On the positive side, the cost of this method of delivery is about half that of the telephone administration and a quarter that of face to face administration. The lack of interviewer costs which include recruiting, trainin g, and monitoring, is a particular advantage in this respect. A study using postal questionnaires takes about the same length of time to execute regardless of sample size or geographical spread. Furthermore, the geographical dispersion of respondents does not normally affect the cost, in contrast to methods that require telephone or especially face to face contact. A postal questionnaire can also be delivered to the whole sample at the same time. In addition, it can be completed at recipients’ own convenient time, and allows them to provide information that may not be readily available. A practical draw back of postal administration is that the researcher requires a list of postal addresses, or access to respondents through a third party such as a professional body or charitable organization, in which case, the researcher often has no direct control over follow up to non responders. A further problem is that postal questionnaires can be subject to higher non response rates th an other means of administering questionnaires. If open ended items are included, in a postal questionnaire, the answers obtained are usually shorter and less in depth than with face to face or telephone interviews. Whatever their intended mode of delivery, questionnaires should be piloted. Table 2 shows the advantages and disadvantages of self completed questionnaires. Table 2: Advantages and Disadvantages of Self – Completed Questionnaires Advantages Disadvantages Easy to complete, if well constructed and presented in a way suited to the target Developing a well constructed questionnaire that produces valid and reliable data is difficult Suitable for topics for which fixed response options can be determined Of limited use for topics where the nature or form of responses cannot be predicted, or for complex issues can not be broken down into a series of simple questions Suitable for gathering much the same information from respondents Less suited to situations where different categories of information are required from different types of respondents since this would entail undue structural complexity in the questionnaire The form in which information is gained from each respondent is usually the same, facilitating comparative analysis across respondents Participants answers are largely constrained to fixed response options which may not be wholly appropriate or comprehensive with limited scope to qualify their answers or introduce issues of their own Can gather somewhat superficial data economically form a large number of individuals The researcher can not explore issues in depth by seeking clarification or elaboration Questions can be worded to include a retrospective time frame for the response May be inappropriate when spontaneous responses are required since the respondents are first required to read and understand the questions asked The language as well the terminology are the same for all respondents Require a minimum common leve l of literacy and comprehension and there is a potential for bias if the questionnaire has to be translated for some participants Anonymity of the respondents is easy to guarantee, and this encourages to be fully cooperate There is little guarantee as to where, when, by whom, and in what order the questionnaire is completed The reactive effects of direct contact between the researcher and participants are avoided The wording and structure of individual items may lead to biased responses, and hence unreliable results Data, particularly those deriving from closed ended questions are relatively easy to analyze and a detailed analysis procedure can be determined in advance. It can be difficult to interpret missing data or inconsistent or ambiguous responses. There is no opportunity to query the actual meaning of individual responses Interviews An interview may be defined as a conversation between interviewers and interviewees with the purpose of eliciting certain information. T hey may be carried out face to face or by telephone (Sim Wright, 2000). The essential characteristic of interviews is that they be neutral. Interviewers must be carefully trained to be familiar with the questionnaire, to follow the question wording, and question order exactly, and to record responses exactly as they are given. The advantage of interviews is that the interviewer can provide some guidance in case a respondent is not sure of what is expected of him or her. Interviews can, however, yield compromised results, especially when the interviewer is biased. Focus Group Discussions Focus groups are groups made up of a small number of people, coming together, to address a specific issue. Although this approach guarantees credible results, it has the disadvantage of being very costly. According to Sim and Wright (2000), focus group discussions have been in the tool kit of social scientists for some time now. In more recent decades, the use of the focus group discussions has incr eased amongst some areas of research as a tool to inform policy and practice. For example, focus group discussions have been used in health and behavioral research, strategic planning, health promotion, policy development, and programme evaluation (Holloway 2008). The increased use of focus group discussions is partly due to a broader acceptability of qualitative methods in these disciplines, but also due to a greater emphasis on the inclusion of qualitative methods in mixed method research designs, to respond to research issues not accessible by quantitative approaches. This more recent emphasis on integrating qualitative and quantitative approaches has ben encouraged by research funding bodies and has led to a renewed focus of raining in missed method research design for post graduate students in academic institutions. The increased use of focus group discussions has led to a greater number and variety of researchers using the method. Focus group discussions are also being applied in a greater variety of settings than in the past. In particular focus group discussions are often used in international research, particularly in developing country contexts. Despite the broader application of the focus group discussion in a wide variety of contexts, much of the existing methodological literature is written with an implicit assumption that the method is being applied only in western developed country context. For this research, questionnaires will be used to collect primary data. The method has strategically been selected because it is quicker than the other data collection methods. In addition, questionnaire will cost much less than either the interviews or focused group discussions. They will also make it possible to reach a bigger number of respondents (Rivera 2007). The questionnaire designed for the research is included under appendix 1. Findings and Conclusion Most airlines have a competitive strategy embodying the type of value they intend delivering. Its c hoice of competitive strategy is reflected in each carrier’s operating strategy. However, the performance associated with an opening strategy depends largely on benefits earned from delivering expected benefits to targeted customers and on costs incurred delivering those benefits. According to airlines have annual revenues of approximately half a trillion dollars and employ over 2 million people. They directly support another 2.9 million jobs at the airport and civil aerospace manufacturers, and may indirectly support in excess of 15 million jobs in tourism. From the discussion presented in this paper, it is obvious that market penetration is not an easy task. It is, therefore, important for each of the airlines to ensure that a good marketing plan is followed by everyone. Although the two airlines focus on different standards of operation, they can each learn form each other, eventually leading improved services. Although Emirates airline does not care about forming alliance s, it will be necessary for the airline to consider forming alliances in order to take advantage of the structures that have been put in place. A key issue is the enhanced competition in the airline industry. There is an obvious polarization between luxury between luxury and low cost brands which will progress. This means that not only does LCC detract market share of established airlines but are also previous middle class airlines will entering the high class market segment. Clearly, both Etihad and Emirates are competing to offer better services to clients and increase their profits. However, the competition will only serve to make the airlines fail to operate smoothly. Rather than compete against each other, it would be beneficial for both airlines to learn good practices from each other in order to progress and go even further. References Babbie, E. R. (2010). The Basics of Social Research. Belmont, CA: Cengage Learning. Carpenter, G. S., Shankar, V. (2012). Handbook of Marketi ng Strategy. Northampton, MA: Edward Elgar Publishing. Gillham, B. (2000). Developing a Questionnaire. New York, NY: Continuum International Publishing Group. Hausmann, R., Austin, E. L., Mia, I. (2009).The Mexico Competitiveness Report 2009. Geneva, Switzerland: World Economic Forum. Holloway, S. (2008). Straight and Level: Practical Airline Economics. Burlington, VT: Ashgate Publishing, Limited. Iatrou, K., Oretti, M. (2007). Airline Choices for the Future: From Alliances to Mergers. Burlington, VT: Ashgate Publishing, Limited. Kleymann, B., Seristà ¶, H. (2004). Managing Strategic Airline Alliances. Burlington, VT: Ashgate Publishing, Limited. Rivera, M. M., Rivera, R. V. (2007). Thesis Dissertation Writing. Quezon City, Philippines: Goodwill Trading Co., Inc. Shaw, S. (2011). Airline Marketing and Management. Burlington, VT: Ashgate Publishing, Limited. Sim, J., Wright, C. (2000). Research in Health Care: Concepts, Designs and Methods. Cheltenham, UK: Nelson Thornes. Appe ndix: Questionnaire Part A: Demographics Kindly answer the following questions by ticking (√) against your preferred choice (s). Please Indicate your position in the organization Marketing Manager Sales Executive Flight Attendant Any other? Please specify How long have you worked for the airline? Less than 1 year 1 – 2 years 2 – 3 Years More than 3 Years How long have you worked at your current position? Less than 1 year 1 – 2 years 2 – 3 Years More than 3 Years Part B: Market Entry Models In your opinion, which of the following is the most effective mode of entry into a new foreign market? (Please circle the number closest to your choice) Most Effective Effective Least Effective (a) Joint ventures 5 4 3 2 1 (b) Alliances 5 4 3 2 1 (c) Direct Investment 5 4 3 2 1 Part C: Multinational Experience In your opinion, does the company generate a huge income from foreign investments? (Please tick (√) one of the following) Strongly Agree Agree Do not Agree Disagree Strongly How capable do you think your firm is in terms of technological, managerial, and financial capabilities to handle international expansion? (Please tick (√) one of the following) Not Fully Prepared Prepared Somehow Fully Prepared Part D: Ability to Develop Differential Products How do you rate your firm’s training program in terms of preparing personnel to conduct international business? (Circle the number closest to your view) Most Effective Effective Least Effective (a) The firm has well designed training programs 5 4 3 2 1 (b) The firm has a poorly structured training programs that can not full prepare personnel to conduct international business 5 4 3 2 1 How do you rate your firms potential to create new and creatively structured products? (Please tick (√) one of the following) Poor Excellent Not Sure Part E: Ability to Stay ahead of Competitors How would rate y our firms ability to handle the fierce competition in the airline industry? (Please tick (√) one of the following) Most Effective Effective Least Effective Part F: Government Policies and Political Environment What do you think is the attitude of government toward foreign investment in general? (Please tick (√) one of the following) Supportive Not Supportive Not Sure Do you think that the political, social, and economic conditions in the potential foreign investment markets are stable? (Please tick (√) one of the following) Strongly Agree Agree Do not Agree Disagree Strongly Part G: Contractual Risk How would you rate the costs associated with making and enforcing foreign contracts? (Please tick (√) one of the following) Very Costly Costly Not Costly Do you think that your firm’s standards of quality will be maintained if the firm operated jointly with local companies in the foreign market? (Please tick (√) one of the following) Strongly Agree Agree Do not Agree Disagree Strongly In your opinion, do you think there are any risks associated with the dissipation or misuse of your firm’s proprietary knowledge if you operated jointly with local companies in the foreign market? (Please tick (√) one of the following) Strongly Agree Agree Do not Agree Disagree Strongly This term paper on Warfare in the High Skies was written and submitted by user Hayden Villarreal to help you with your own studies. You are free to use it for research and reference purposes in order to write your own paper; however, you must cite it accordingly. You can donate your paper here.