Why Nigerian airlines fail, by CITA boss

The inability of Nigeria’s airlines to grow, expand and be strong enough to attract more Nigerians to travel by air has contributed to excess capacity that has led to huge economic losses in terms of potential turn-over of the carriers, Chief Executive, CITA Aviation Fuelling Company, Dr. Thomas Olaleye Ogungbangbe, has said.

He spoke in a paper he delivered at the weekend in Lagos entitled: “Strategies and Business Performance of Domestic Airlines in Nigeria.”

Specifically, he carpeted executives in Nigerian airline industry whom he said have not been market-driven, saying they lagged behind in adopting marketing concept and other promotions.

These, according to him, brings about low capacity, inability to provide quality services and the resultant abysmal profit. Ogungbangbe stated that in the aviation industry where air travel business is highly competitive, marketing activities are inevitably vital to ensure competitive edge.

He stressed that most airlines are doing just about anything in order to remain relevant and still meet the ever dynamic needs of the passengers. He disclosed that most airlines in Nigeria have not actually contributed to the growth of the economy as required, just as he lamented that most carriers close down before their fifth anniversary.

Ogungbangbe stated that marketing strategies represents not just a change to the commercial environment in which individual airline operates, but also needs to be considered in terms of its net effect on the Nigerian economy.

His words: “Studies have shown that for these airlines to survive the competition in their  industry, they need to take their marketing very seriously.The global world of business today is a very dynamic one in order to satisfy the ever changing needs of customers. Organisations must first know their needs and ensure such needs are met with the services they provide.

“For airlines to survive in today’s competitive market, they need to treat the marketing drive of its business with top priority to ensure adequate business performance,” he added.

He stated that poor marketing strategies were responsible for the low business performance of airline operators in the country.

He recommended that the airline industry should aggressively be market driven by adopting marketing concept. The business mogul disclosed that a random sampling of the passenger manifest of any airplane coming in or going out of Nigeria reveal that at least 80 per cent of the passengers are Nigerians, describing Nigerians as very open minded people when it comes to their travel, comfort and safety, stressing that they would travel with any airline that offers them good fares, safety and comfort.

Ogungbangbe noted that the health of the Nigerian economy is directly proportional to the viability of the Nigerian aviation industry.

He said: “To unlock the unprecedented returns in Nigeria airline industry, we need to have the market share, working capital, customer satisfaction and profitability of these carriers. To achieve all these, the marketing factors such as sales growth, direct marketing, mouth-to-mouth marketing, online marketing and transactional marketing are not negotiable.”

Ogungbangbe urged airline operators to see marketing as a strategic tool to survive and prosper in a turbulent environment that demands both financial performance and effective stakeholder responsiveness.

He reiterated that it should be realised that the economic configurations that were so successful during the 20th century are unlikely to serve airlines so well in the 21st century, particularly with the challenges posed by the continuous, changing demands and growing sophistication of customers, new technology and ultimately employees’ dynamic and conflicting interests with that of the owners.

In order to get around these issues, the CITA boss explained that the efforts of airline operators must be directed towards harnessing the non-economic and long run effects of marketing strategies to achieve corporate visibility, enhanced public image and viability.

He further stated that given the multiplicity of interests, the challenge now facing airline operators like most other companies, is how to reconcile and manage these varied interests without compromising one for the other in the achievement of their organisational strategic goals.

Wole Shadare