Classic Airlines Marketing Solution
Classic Airlines ranks number five among the largest airline companies across the globe. The company has a fleet in excess of 375 airplanes servicing 240 cities with approximately 2,300 daily flights. The company has consistently grown since inception with last year’s sales at $8.7 billion and a profit of approximately $10 million (University of Phoenix, 2012). Since ultimate success is based on continuously meeting the needs of customers and company profitability, Classic Airlines is challenged with both positive and negative aspects of their marketing strategy to meet those needs. Current Problem
Instability of fuel expenses and increasing labor costs present challenges to the profitability of Classic Airlines, with increases in ticket prices being passed on to the customer. The trickle-down effect of increasing prices leads to the demise in the loyalty of customers and reward members, which make up 95% of Classic Airlines frequent fliers. Fierce competition in the airline industry has also led to fewer customers remaining loyal to flying with Classic Airlines as opposed to other airlines. As a result, Classic Airlines is under extreme scrutiny and screening from the stakeholders because of the decline in stock value due to the loss in revenue (University of Phoenix, 2012). Problem Definition
Classic Airlines has neglected to make superior customer service a high priority to keep their customers. The company must overhaul the outdated rewards program to increase market awareness and revitalize customer loyalty in the airline company. Poor business decisions made in the past will challenge the strength and success of the new executive leadership’s ability to get the company back on track with a limited marketing budget available to use. A reconfiguration of the Customer Relationship Management (CRM) system was made to ultimately decrease or eliminate call time for customer service representatives. Unfortunately, the system enhancement reduced the time that customer service representative spent talking to customers which eroded customer relationships. Customer satisfaction decreased and complaints increased causing employee morale to quickly disintegrate causing internal conflicts to increase. The company was in an external and internal nosedive to disaster. With the current mandate from executive management to decrease costs company-wide, Classic Airlines must be creative with new promotional and selling concepts. There is a fine line between the proper balance of cutting costs and increasing marketing capacity. The ability to market to a wider range of customers while not decreasing ticket prices can be quite tricky. The rewards program must be reengineered to focus on the benefits for the customers to fly with Classic Airlines. Selling the customer service value is also a needed requirement to be included in the marketing concept. Customers must feel valued and have a good experience when flying with Classic Airlines to stay loyal to the company. They must also be rewarded for choosing the company From executive management to front-line employees, organization and team development is needed to support future viability of Classic Airlines. Currently, the company does not appear to be in a joint-effort environment toward a team strategy environment and marketing effort. Internal marketing within the company, beginning with the executives, can produce a cohesive vision and strategy where all departments work together for a common cause. Buy-in and excitement from employees within the company will produce departments such as sales and customer service to work as a joint effort to produce value and customer satisfaction. Every department within the company must adopt the concept that marketing is about everyone, from employees to customers, vendors, and partners. The company must work toward 100% adoption and clear direction of the...