Classic Airlines and Marketing2.Docx

In: Business and Management

Submitted By dougdoss
Words 937
Pages 4
Classic Airlines and Marketing
August 6, 2012
Dr. Isaac Owolabi

Classic Airlines and Marketing
Classic Airlines is the fifth largest airline in the world and faces the same challenges that continue to plague the airline industry. These challenges are the rising costs of labor and fuel, a decrease in consumer confidence, and fierce competitive pricing. Although Classic remains profitable their share price in the past year has decreased by 10% and customer confidence has also declined resulting in a 19% decrease in Classic Rewards members (University of Phoenix, 2010). The board of directors of Classic Airlines in an effort to prevent further financial crisis have mandated a 15% cost reduction across all departments within the next 18 months. Classic’s CEO, Amanda Miller, has requested Kevin Boyle, Chief Marketing Officer (CMO) to develop a marketing plan to lure back Classic’s frequent fliers. Although there are a number of marketing concepts found in this week’s readings that could be applied to address the challenges faced by Classic Airlines the two concepts that will be covered in the following paragraphs are the marketing concept and the holistic marketing concept.
Marketing Concept.
Unlike earlier marketing concepts such as production, product, and selling that focuses on the product or service the marketing concept focuses on the demands, wants, and needs of the customer (Kotler & Keller, 2006). The purpose of this concept is to find the right product or service for your customer, and not the right customer for your product or service (Kotler & Keller, 2006). This marketing concept relates to the Classic Airline scenario because it is obvious that the organization needs to align with the wants and needs of the customers to improve customer confidence and increase frequent flyer and rewards club membership numbers. This…...

Similar Documents

Classic Airlines

...Introduction ________________________________________ Classic Airlines is the fifth largest airline in the world and it commands a fleet of 375 and above jets that serve approximately 240 cities on daily flights that are around 2, 300. Classic Airlines was incepted 25 years ago and since then, it has grown into a large organization of almost 32,000 employees. Despite the high rate of profitability of Classic Airlines, challenges that affect today’s Airlines are inevitable. Some of the challenges include uncertainty about flying which has greatly affected stock prices. ________________________________________ The other challenge is consumer confidence that has greatly decreased probably due to increased negativity from the public, media and even Wall Street. Classic Airlines desire is to boost employee and consumer confidence and this is through increasing employee and customer satisfaction and keeping down costs. This research paper will use Classic Airline scenario to present the current issues and opportunities, identify a marketing problem, describe the end state vision and finally identify solutions to the problem. ________________________________________ Discussion Identification of issues and Opportunities The marketing activities of Classic Airlines are influenced by several factors and some of these factors are uncontrolled. It is evident that the company is faced with rising costs of labor and fuel which has led to cutting of costs through better efficiency...

Words: 2966 - Pages: 12

Classic Airline

...Classic Airlines and Marketing MKT/571 Every company recognizes that it costs far less to hold on to a customer than to attain a new one. As the commercial airline industry is shifting at a fast pace, Classic Airlines is faced with the obstacle of bringing improved value within thinner consumer budget. Since the travel industry expenses are decreasing and new technology is steadily replacing many jobs, Classic Airline is set to use this as an opportunity to influence proven techniques while improving the existing Customer Relationship Management system. Classic Airlines strives to introduce a transparent planning process to increase customer loyalty. Rising costs and over expansion has been a hindrance for Classic Airlines. With a 20% decrease in flights, 19% decrease in rewards members and 32,000 employees on the payroll; the company is need for a significant change. The Board of directors have also added a 15% cost reduction mandate for 18 months increasing the need for a transformation within the company. Amanda Miller was hired in 2000 to prepare for her promotion in 2002, following the retirement of Jack Broadway. This switch happened at a critical time, and has inopportunely set the airline back. Amanda Miller believes in operational excellence as the number one priority for the company, which has left the firm vulnerable in a time when consumers need to be valued and competitors are learning more of continuous improvement. Problem Solution Classic Airlines......

Words: 2590 - Pages: 11

Classic Airlines

...Classic Airlines Classic Airlines and Marketing MKT/571 May 12, 2012 Dr. Robert Miller Classic Airlines and Marketing Competition in any field of business is usually encourages innovation and creative thinking within the organization. Management is always researching new ways to improve current operations to have an advantage over the competition. Classic Airlines is an example of the fierce competition in the business world, as they are losing customers and seeing a reduction in their sales. The company’s reward program member numbers are shrinking along with the increase of fuel prices are a few factors pushing the company towards bankruptcy. This research will identify the products and services, the challenges and also the marketing concepts the company uses. Classic Airlines travel / flight service to their customers in 240 cities. The Company offers a classic rewards program as a benefit to its frequent fliers, which allow them to collect points for flights and car rental with specific partners at many locations. These points can be redeemed for flight upgrades and pre-boards. Classic Airlines has a CRM or customer relationship marketing program which enables interaction with their customers. The marketing concept pushes an organization to thrive and focus its operations on the customer (Kotler & Keller, 2006). The concept is to alter the product to the customer orientation and lifestyle. Customer focus has to continue to......

Words: 490 - Pages: 2

Classic Airline

...Classic Airlines Marketing Solution Classic Airlines is the sphere's fifth leading airline by way of a fleet of more than 375 jets, serving 240 cities (Keller & Kotler, 2007), using additional 2300 flights daily. The airline has developed into an organization of 32,000 employees from exemption of 25 years ago. The corporation has earned $10 million on $8.7 billion in transactions from the preceding year (University of Phoenix, 2010). The commercial airline industry has continuously been vulnerable to the economic and political fluctuations, typically in times of an economic calamity for that reason; Classic Airline’s tests as an airliner are not unforeseen. The corporation is a significant contender within the airline business; nevertheless, like countless airlines; Classic faces several challenges because of the increasing customer worries about flying and the current market ups and downs. Classic Airlines recognizes changes that are necessary for the business; conversely, the managing team needs to recognize the present-day marketing difficulties that are troubling the business and determine choices for solving these complications. The paper will benefit Classic Airlines by means of the nine-step problem-solving model in the direction of identifying issues and prospects that will support the airline within the current marketing problems, pinpoint the internal and external pressures contributing to the corporation's crisis. By using the nine step-problems solving......

Words: 2140 - Pages: 9

Classic Airlines

...Classic Airlines Classic Airlines is one of the world’s largest airline companies that functions with 375 jets and continues to serve 240 cities with 2300 flights a day. Classic Airlines Company grew over the 25 years in business to 32,000 employees and with 10 billion dollars in sales. Even though Classic Airlines has had a positive success, the company also faces the challenges that other airline company’s face in today’s market. Classic Airlines needs to come up with ways to market the company’s product so the customers will want to choose Classic Airlines instead of the other airlines. In addition, Classic Airlines worries about the increase of the global market, competition for the company, the changes in customers spending habits, and the increase of concerns with the airlines security. Classic Airlines needs to take into consideration the amounting stressors and the reduced profits for the company. Classic Airlines has an increase of uncertainty because of the decrease in the stock prices. Classic Airlines stock prices decreased 10% per share. “Classic Airlines experienced a 19% decrease in the members in the affinity program and with a 21% decrease in flights for other members” (University of Phoenix, 2012). Classic Airlines has come across some issues with the rising costs for airline fuel and labor. Financially Classic Airlines is suffering and hampering the company’s abilities to compete with other airlines. To make matters worse Classic Airlines has to increase......

Words: 1521 - Pages: 7

Classic Airlines

...Classic Airlines Marketing Solution Classic Airlines is the fifth largest airlines in the world. Classic Airlines has had a history of success and profitability, but as the competitive market changes and a downturn in the travel industry, management has identified changes that need to be made. To ensure the airlines remain competitive and profitable Classic Airlines is faced with the challenge of delivering increased value within leaner budgets. The analysis of the current situation of Classic Airlines is to use proven techniques to address customer loyalty issues and improve the existing Customer Relationship Management (CRM) system. Classic Airlines may uncover numerous opportunities to meet executive demands when implementing the use of the nine-step problem-solving model. Issues and Opportunities: Step One Classic Airlines has become a successful company in Customer Relationship Management. Classic has continued to be profitable; however, recently has been plagued by the uncertainty in the flying industry. Issues have been identified that need addressed, both internally and externally to avoid bankruptcy. External issues include competition, government regulation, and operating costs. Classic Airlines price structure has been uncompetitive compared with other airlines in the industry. Discount Airlines, such as Southwest, and its no-frill business model have enjoyed tremendous success, wooing customers based on price, not perks (Plunkett, J, 2012). Operating costs,......

Words: 2925 - Pages: 12

Classic Airlines

...Classic Airlines and Marketing Solution Your Name Here MKT/571 December 12, 2012 Instructor Stuart Ringer Introduction The standard method for solving a problem primarily will involve defining the problem, understanding the problem in relation to the current developments, and assessing what in fact needs to change. In the case of Classic Airlines, budget restrictions, decreased sales, low employee morale, diminished customer satisfaction, and the need to cut costs are the issues that plague the organization. According to the University of Phoenix (2012), Classic Airlines has experienced a decrease in stock prices due to limited consumer assurance, rising costs of labor and fuel. In searching for solutions, this paper will employ an aggressive nine step process of defining the problem to achieve the recommended marketing solution that includes the following steps: 1) define the situation or problem; 2) frame the right problem and measure the levels of current performance; 3) describe the end-state goals that will provide direction and vision to help management make the appropriate choice; 4) identification of alternatives that determine root causes and determine the reasons the process is working or not working appropriately; 5) evaluation of alternatives and select the best strategy to solve the problem; 6) identify and assess risks; 7) making a decision; 8) develop and implement solution and appropriate changes in the process; 9) evaluation of results to stay......

Words: 2302 - Pages: 10

Classic Airlines

...Week Three: Classic Airlines University of Phoenix MKT/571 The economy, increasing fuel costs, and strict security measures lead to intense competition in the airline industry. In attempts to remain profitable and successful, airline company management is challenged to reinvent continually company strategies to remain competitive. Classic Airlines is currently the fifth largest airline company with a fleet of more than 375 jets, serving 240 cities, and more than 2,300 flights daily. To maintain and potentially grow profits and market share, Classic Airlines, and its more than 32,000 employees, will make complex and risky decisions in an attempt to implement problem-solving strategies. The terrorist attack on September 11, 2001 immediately affected the profitability of the airline industry. Leisure travel has been significantly affected because of initial fear of flying and continued increase in security measures. To date, Classic Airlines, although subject to a 10% decrease in market share price, remains profitable. However with low employee morale and decreasing customer loyalty, evident in a 19% decrease in the number of reward members and a 21% decrease in flights of current members, the executive leaders of Classic Airlines elect to reduce costs over an 18-month period. Challenges of reducing expenditures, increasing employee......

Words: 2939 - Pages: 12

Classic Airlines

...Classic Airlines Marketing Solution Because of the tragic events following 9/11, airline industry’s profits significantly decreased which resulted in an economic downturn. Classic Airlines was not immune to the recession. Classic Airlines Classic’s Rewards Program is currently suffering. Classics Customer Rewards Program has seen a 19% decrease in the number of members and a 21% decrease in flights among its current reward members. Classic Airlines marketing department needs to make an effort to increase customer volume and sales. So what can Classic Airlines do to increase these numbers? Identifying and addressing the internal and external factors contributing to Classic Airlines current crisis will help alleviate pressure associated with this current economic downturn. Employing market data to help develop goals while recognizing and focusing on the challenges and opportunities facing Classic Airlines, will give the airline the ability to take their future to new heights. Classic Airlines is the fifth largest airline and commands a fleet in excess of 375 jets that serve 240 cities with more than 2,300 daily flights. The airline also manages a staff of nearly 32,000 employees. Classic has managed to remain profitable over the past year. The airline earned $10 million on $8.7 billion in sales; however with rising overhead costs Classic Airlines is experiencing setbacks. The airlines share prices have decreased by 10% in the past year. Furthermore, with the negative......

Words: 7997 - Pages: 32

Classic Airlines

...Classic Airlines Marketing Solution Introduction Classic Airlines is the fifth largest airline in the world. Despite achieving high profitability, there are a number of organizational issues facing the company. Both internal and external marketing programs have failed to meet stakeholder expectations. Target customers shifted to other airlines in an attempt to get their needs and wants satisfied. The outcome of this shift is low sales and profits for Classic Airlines. The fundamental role of a marketing plan is to enable a firm to establish a strong connection with its customer. In this scenario, Classic Airlines needs to come up with an effective action plan that will help in attracting and retaining customers as well as boosting profits and sales. A marketing solution to Classic Airlines case scenario will be presented using the nine-step model. Description of the Situation Identification of Issue and Opportunity Classic Airlines is one of the major airlines in the world, and has been operating for more than 25 years. The company directs a fleet comprising of jets exceeding 375 and serving 240 towns with daily flights exceeding 2,300. There are several challenges that the company is facing, owed to lack of innovation and escalating costs. In addition to customers not being content with the service received, the management has not identified effective solutions to the issues faced. According to a Classic Airlines’ manager, “rising above our competition without......

Words: 2490 - Pages: 10

Classic Airlines

...SOLUTION: CLASSIC AIRLINES Problem Solution: Classic Airlines Problem Solution: Classic Airlines Classic Airlines has established themselves as the fifth largest airline within their 25 years of existence. Recently they have experienced a 10% decrease in share prices and are faced with a challenge of expanding their frequent flier program using methods that will demonstrate a return on the investment. Classic Airlines will first take a dive into the environmental factors of social, economic, technological, competitive and regulatory forces in order to determine the right problem. (Kerin 2005) “These five forces may sometimes serve as accelerators or brakes on marketing, sometimes expanding an organization’s marketing opportunities and other times restrict them.” Ultimately Classic Airlines will reach the point where they value their customer’s needs. Airlines will always be in demand; therefore it is imperative Classic Airlines develop a marketing plan that will ultimately keep the airlines ahead of the competition. Describe the Situation Issue and Opportunity Identification Classic Airlines has experienced a 10% decrease in share prices over the past year, along with a 19% decrease in Classic Rewards members, and 21% decrease in flights amongst remaining members. Classic Airlines Employees are experiencing low morale issues from the media input of the state of Classic Airlines. Although the Customer Relationship Management (CRM) system was inputted at......

Words: 2160 - Pages: 9

Classic Airlines

...Classic Airlines happens to be one of the largest airlines in the world. They command a fleet that has more than 375 jets that happen to serve over 240 cities and has more than 2,300 flights daily (University of Phoenix, 2010) The company continues to be very profitable, but with the current state of the economy, and the rising overhead cost that Classic Airline faces. Recently the company has faced some setbacks. There have been many both external and internal pressures that have contributed to current crisis that is facing Classic Airlines. Classic Airlines will use their internal marketing resources and employ marketing options to find a solution that will help the company. Classic Airlines will use the 9-step model to solve some of their problems. It is not required for the company to use a problem solving model. In using the 9-step model classic Airline’s will be able to identify and define some of the problems that the company faces. It will consider the internal and external pressures that happen to be contributing to the current crisis that Classic’s faces. Classic Airlines implementing the 9-step problem’s solving model Classic Airlines will be able to uncover numerous opportunities that the company may not have found, It will help Classic Airlines to identify the problems that the company has, help them come up with plans for the solution, help the company display ethical dilemmas, and it also helps the company measure the solutions that may help the......

Words: 2164 - Pages: 9

Classic Airlines

...Classic Airlines: The Situation University of Phoenix MKT/571, Marketing Classic Airlines: The Situation Problem Solution: Classic Airlines In order for Class Airlines to overcome its current conditions, the company must undergo a very structured problem solving process. The nine-step problem solving process is just the process that Classic Airlines need. The nine step process consists of the following: • Step 1: Describe the Situation, o Involves identifying key concepts, issues, and opportunities in order to determine the overall focus of the project (McNeese, 2004). • Step 2: Measure the Problem, o Requires that baseline data be collected on the present processes and that the problem be observed and analyzed from a broad perspective so that many problem solving possibilities may be examined (McNeese, 2004). • Step 3. Set End-Goals, o This step will help provide vision and direction and help make choices as to which path Classis Airlines should take (McNeese, 2004). • Step 4: Identify Alternative Solutions, o Allows Classic Airlines the opportunity to look at other companies as benchmarks in order to develop techniques that will help the company conquer disadvantages (McNeese, 2004). • Step 5: Evaluate Alternatives/Strategies, o Allows Classic Airlines to examine the best strategy that will solves the company’s current problems and avoid future occurrences (McNeese, 2004). • Step 6: Identify and Assess Risks, o Allows Classic Airlines to develop...

Words: 1367 - Pages: 6

Classic Airlines

...The purpose of this paper is to use a problem solving model to analyze the current situation with Classic Airlines. Initially, we will focus on the challenges, opportunities, external and internal pressures of marketing. Next, a clear problem statement will be constructed that is open to multiple solutions. It will conclude with SMART en-state goals that are specific, measurable, attainable, realistic and timely. Classic Airlines has seen a 10% decrease in share prices within the last year as uncertainty about flying has affected industry stock prices. Rising costs, specifically of labor and fuel, have crippled them and negativity from Wall Street, the media and the public has affected employee morale reducing it to an all time low. Although Classic’s Board of Director’s recently mandated a 15% across the board cost reduction over the next 18 months, it’s still mandated they create a way increase the frequent flier program reflecting a measurable return on any investment. The 9 step problem solving model includes the following steps: 1) Describe the situation. Provide an initial description of the issue or opportunity, which will become the basis for defining the “right” problem. 2) Frame the right problem. This is done based on the situation or scenario. 3) Describe end state goals. This is done based on that problem definition from the previous step. 4) Identify alternatives. Possible alternative solutions are created. 5) Evaluate alternatives. The alternatives from......

Words: 2246 - Pages: 9

Classic Airlines

...Classic Airlines Marketing Solution Kandice Bell MKT 571 April 24, 2012 Professor Barnet Classic Airlines Marketing Solution Introduction Classic Airlines is one of the top airline industries at this moment in time but the company has faced head on with challenges trying times and a decline in revenue and passenger activity. The company has attempted to attract and retain customers through different programs and strategies such as the rewards program, which can be found with many companies that offer a product or service. Although the company offers a rewards program with a decrease in passengers the rewards program is not bringing in the type of profit was expected or anticipated. If the company macro-environmental change, a marketing research program, and develops a marketing plan the airline should be able to re-introduce the current rewards program to fit the current economic conditions and market the program to the public in a manner that the plan increase passenger activity and revenue for the airline and the company as a whole. Problem Statement Classic Airlines is losing customers to the competition due to rising fuel and labor costs, unsatisfied customers, and the company may also be facing bankruptcy. The number of Classic Rewards members has decreased by 19% and the loyal customers that Classic Airlines does have are leaving the company because they feel as if their voice is not being heard. The frequent flyers have also stopped flying as......

Words: 511 - Pages: 3