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Products-southwest after merger airtran airways
Southwest airline marketing plan
Southwest airlines marketing strategy
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Southwest Airlines operates in the American domestic market. It is well known for its growth over the years. Its mission is the dedication to the customer service of the highest quality that is delivered with a sense of friendliness, company spirit, personal pride and warmth, (Inkpen & Degroot, 2). The airline industry had general environmental factors that do impact it is several ways within the market.
The first one includes the political and legal factors. These include the intervention of the government in the economic operations of the industry. The government intervention is necessary since it protects the interests of the passengers as well as the safety measures of the airline operations, (Inkpen & Degroot, 12). Economic factors are
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This has rattled the global financial markets. The stocks of the airline industry have been hit very hard whereby fears of the demand for traveling are slackening. It is expressed by the International Air Transport Association, there are expectations for the passenger market of the U.K. to shrink by 2020 in the band of 3—5% due to the Brexit materializing, (Inkpen & Degroot, 14). The strategy of the Southwest Airlines is to focus on a short-haul passenger and to provide rates that are as low as a third of the competitors. Its HRM strategy is to be using the business model that is very straightforward and rather than having a hub-and-spoke service, they have a point-to-point …show more content…
It is a problem that will affect the profitability of SWA. This would be by lowering it since it will be experiencing an increased cost. But so as to hedge its exposure to the fuel price fluctuations, SWA will have to make use of the fuel swap. This is an agreement between parties that makes sure that the floating (market) price can be traded over a specific timeframe for a fixed price. The marketing tool by SWA in the “Bags Fly Free” program is made specifically so as to show its clients that they care for them. The first and the second checked bags are not paid for as well as skis and golf bags. This is a tool that favors many passengers and therefore many like SWA for this. Since it is a strategy that benefits them, SWA will hold on to it even in the future.
Despite the challenge with the fuel price fluctuation, SWA has a growth rate that would see it far economically in the future. The acquisition of AirTran clearly explains that SWA will have great heights in the future. This is because the AirTran has helped very much in entering into the international markets. It also assisted in adding 21 cities into the network of the airline whereby 7 of them are lying in the international market. The international presence has led to the expansion of the Southwest to Northern and Central America. The AirTran has also made SWA the largest domestic
Environmental factors have changed drastically over the past fourteen years. Since September 11, 2001, Airlines have changed greatly to enable safer and cost efficient flights for the world. Specifically, Southwest Airlines has changed their marketing strategy for their flights since 2001. Southwest has faced environmental factors that have affected the costs in airlines, exploited those environmental factors, and faced influential factors in addition.
Southwest Airlines is operating in an industry that is struggling to make profits. The slowing economic growth and raising fuel costs are lowering earnings while revenues remain the same. The macroeconomic factors affecting the airline industry include unemployment, the economic growth in the United States, and inflation. With low economic growth, consumers are finding luxury items more difficult to purchase and airline tickets for vacations fall into that category. Unemployment contributes to a lack of vacation travelers since individuals who are not employed do not have extra money for vacation or airline tickets. Inflation also causes operating costs of the airlines to be higher cutting into profits.
Another internal challenge for Southwest Airlines is the conflicting management style and business operation with AirTran. On top of that, the external challenges such as the increase of competitions and gas prices are some of issues f...
Southwest Airlines strategy of focusing on short haul passenger and providing rates as low as one third of their competitors, they have seen tremendous growth in the last decade. Market share for top city pairs on Southwest's schedule has reached 80% to 85%. Maintaining the largest fleet of 737's in the world and utilizing point-to-point versus the hub-and-spoke method of connection philosophy allowed Southwest to provide their service to more people at a lower cost. By putting the employee first, Southwest has found the key to success in the airline business. A happy worker is a more productive one as well as a better service provider. Southwest will continue to reserve their growth in the future by entering select markets only after careful market research.
Also, Southwest is renowned in the airline industry for its short turnaround time on arrivals and departures. And since people's biggest concern nowadays is money and time, having low price airline tickets to cater their traveling needs in a shorter period of time will surely satisfy them. Moreover, aside from the low prices offered, what attracts customers is Southwest’s way of dealing with them. The employees of the airline treat their customers well and really listen to their needs. Southwest Airlines is also well-known for having a very productive and loyal workforce.
Since 1987, when the Department of Transportation began tracking Customer Satisfaction statistics, Southwest has consistently led the entire airline industry with the lowest ratio of complaints per passengers boarded. Many airlines have tried to copy Southwest’s business model, and the Culture of Southwest is admired and emulated by corporations and organizations in all walks of life. Always the innovator, Southwest pioneered Senior Fares, a same-day air freight delivery service, and Ticketless Travel. Southwest led the way with the first airline web page—southwest.com, DING, the first-ever direct link to Customer’s computer desktops that delivers live updates on the hottest deals, and the first airline corporate blog, Nuts About Southwest. Our Share the Spirit community programs make Southwest the hometown airline of every city we serve.
Advertising: As one of the largest domestic airlines, Southwest Airlines has an enormous advertising budget to sustain its presence and increase its market share through focusing on the benefits of flying Southwest over its competitors. Southwest recognizes that flying is no longer a pleasurable experience for many customers, even on Southwest, historically a budget airline. Even though Southwest is often regarded as a no-frills airline, it still attempts to build goodwill from its customers based on its advertising. Of the $249 million it spent on advertising in 2011, Southwest Airlines is unique in that it does not sell additional ad space on the exterior of its aircraft. Many domestic airlines have begun selling aircraft exterior space as a way to increase revenue, but Southwest Airlines insists that it wants to keep its product and advertisi...
There are few things that are impressive about Southwest Airlines first one is how they treat the employees. For Southwest Airlines employees are first and customers are second. If the employees are treated well that will bring in happy customers. Next is that Southwest is not only with their low prices but is able to create a competitive advantage by offering a fun and humorous experience when flying. Finally another impressive fact is when Herb Kelleher’s retire from CEO position yet remained a Southwest employee till July 2014. Even after the retirement he was still active with the Southwest Airlines that reflected his enthusiasm and dedication for the
Before to select the proper alternative, three alternatives were analysed and evaluated under four decisions criteria: customer experience, cost, growth rate / market penetration and ease to implementation (See Exhibit 2: Factor Analysis). Between all the alternatives, it was suggested that Southwest Airlines enters to New York City by bidding the slots and gates at the LGA (See Exhibit 3: Alternatives Analysis). This alternative sustains the challenge of changing the customer experience which means adding more flights from and to the East; furthermore, entering to new markets will reinforce “the power of the network” through LGA. At the same time, this decision will allow signing more code-sharing agreements with other airlines flying to international destinations and offer new products and services to LUV customers as loyalty rewards, in-flight internet, onboard duty-free purchases, etc.; as a result of this, it will increase passenger’s insights and experiences by flying with Southwest Airlines. Nevertheless, there is potential risk by selecting this alternative, in the recent years the energy prices has had a huge increase affecting costs, fares and even capacity needed, however Southwest Airlines has been able to hedge fuel for decad...
It all started in 1971, when Rolling King and Herb Kelleher decided to challenge the existing rut of charging high prices for air travels. They considered the railways and roadways their competitors and decided to offer cheaper travel for smaller routes. The company was incorporated in 1967, apart from initial entry troubles, Southwest has been the only US airline to have earned profits since 1973. The eccentric company’s outlandish way of conducting themselves has been the sole reason for Southwest Airlines to succeed in a highly competitive and packed industry.
The mission of Southwest Airlines is a dedication to the highest quality of service delivered with warmth, friendliness, individual pride, and company spirit (Mission…, 2007). The company also provides opportunities for learning and personal growth to each employee. Creativity and innovation is very important and highly encouraged, for the purposes of improving effectiveness. Employees are to be provided the same concern, respect, and caring attitude within the organization that the employees are expected to share with the customer. Southwest Airlines was initially created to be a low-cost alternative to high price of intra-Texas air carriers (Freiberg, 1996). Southwest’s fares were originally supposed to compete with car and bus transportation. It was a little airline, and it would withstand the test of time. As a discount, no-frills airline, it would provide stiff competition for larger airlines. Their strategy was to operate at low cost, offering no food, no movies, no first class, and no reserved seats. They created their own market and provided increased turnaround times at the gate, by avoiding hub-and-spoke airports and opting for short-haul, direct flights. Through this market approach, Southwest has a majority of market share in the markets they serve.
The perennial crisis in the airline industry: Deregulation and innovation. Order No. 3351230, Claremont Graduate University). ProQuest Dissertations and Theses,, 662-n/a. Retrieved from http://search.proquest.com/docview/304861508?accountid=8364.
Several large scale, interrelated conditions have affected the airline industry over the past several years in such a manner that every carrier has had to respond in order to remain viable and competitive.
As a consequence, SAA markets has gradually suffering from slack down recorded from the past three years dated 2012. SAA is finding itself difficult to sustain profitability due to reduction in passenger’s traffic and increased in operating expenses coupled with heavy competition burdened by competitor’s pressure. Customers are more than ever demanding a different and personalised relationship with the airline.
It is clear that talks about Brexit will not end quickly, and most important question is, what will happen in future. Well it could be claimed that is three different endings how this situation could end. Firstly one of the scenario is that Brexit happened and the U.K. completely leaves EU. In that case firstly British currency, the pound sterling, will fall down even more, than in the start after referendum. Also it will have consequences not only in Britain but also in the hole world, for example , some other countries, will see how Britain left European Union, and they will also will spoke to leave EU. So British leaving EU will have wide ranging repercussions on the other countries who look into EU skeptically also it will help Euro-skeptic