From Inception to Innovation: redefining the aviation business model

Change is in the air, companies across all industries are now well-accustomed to change as the world economy starts to pick up following the economic downturn over the past few years. Here in the UAE, and in particular Dubai, there has been rapid growth and progression over the past decade. This has resulted in greater infrastructure development and more stringent regulation of businesses to support changing market needs.

Moving forward, positive financial indicators in the region, such as investment ratings company MSCI’s upgrade of the UAE from frontier to emerging market status, will undoubtedly attract more institutions and foreign investment. This will help to boost the local economy and further cement its position as a leading logistics hub.

Changes can also be seen, quite literally, ‘in the air’ within the regional aviation industry, which is an integral mechanism for supporting overall growth. Traveller habits have become much more focused on cost-effective and flexible solutions that allow them to choose the products that suit their individual requirements.

There has been growing demand for travel to destinations within a five-hour flying distance from Dubai. Strategically positioned as the gateway between East and West, Dubai International Airport is now set to become the world’s busiest airport over the next two years, overtaking London Heathrow.

The number of passengers visiting this regional aviation hub, which connects travellers between Central and Eastern Europe, Africa, Asia, the Subcontinent and beyond, increased by 13.2 per cent to 57 million in 2012. With an array of mega-projects in the pipeline and the UAE awaiting the imminent announcement of the Expo 2020 bid, this is a trend that is expected to boost passenger numbers to an impressive 70 million in 2014.

In order to cater to the short-haul market, airline companies can benefit from moving away from the traditional business model and focusing on streamlining operations and giving passengers a more customised travel experience.

flydubai’s business model, was built around the fundamentals of agility and flexibility. This has allowed the airline to continuously tailor its offering to suit passengers’ needs by gauging and responding to the evolving traveller behaviour.

From the very beginning, the airline has challenged conventions within the aviation industry. Moving beyond the definition of a low-cost carrier (LCC), flydubai has opened up routes to primary airport to more than 45 previously under-served markets while maintaining a relatively low operating cost structure and achieving profitability in its third year of operation.  This has been realised by growing the airline sustainably and maintaining a focus on efficiency which has allowed the airline to continue to invest in its passengers’ flying experience.

Most recently, the airline created a whole new product offering with the introduction of Business Class on board its flights. Passengers can now benefit from faster check-in services, a dedicated business team, more comfortable and spacious seating and a variety of internationally inspired menus during their journey, complemented by the convenience offered by Dubai International’s Terminal 2.

In the few short years since flydubai was established, the airline has enabled more than 10.4 million passengers to travel affordably across a network of over 65 destinations in the Middle East, Southeast Europe, Russia, Ukraine, Central Asia, Subcontinent and North and East Africa; a growing network that has resulted in the constant review and evaluation of market conditions and passenger requirements to inform a dynamic and continuously evolving business strategy. For flydubai, change is in the air.