June 26, 2012
Classic Airlines Marketing Analysis
Classic Airlines the fifth largest airline with 8.7 million dollars in sales and servicing 240 cities (University of Phoenix, 2012) Classic Airlines is marketing their rewards program to foster frequent fliers and loyalty amongst their respective fliers. The airline is currently selling in a consumer market, trying to establish a brand image. A brand could be a symbol, name, sign, design, etc. used to identify the service or good of the seller. The brand becomes the staple for the company’s promise to deliver the expected product or service (Kotler & Keller, 2012). Classic Airlines proposed brand is based on customer focused services, which will be discussed later in the paper. (According to Kotler and Keller (2012), brand equity is the customer’s opinion of the brand, which may differ from his objectively perceived value. It’s stated that brand equity is the most important driver for customer equity because brand equity show how consumers feel and think about the brand which can lead to profitability for the company. To increase profitability for Classic Airlines and bring the attention back to the customers, the airline introduced the rewards program which offers members an opportunity to earn miles with all qualifying flights. It states 95% of Classic Airlines flights are eligible flights (University of Phoenix, 2012). This feature will allow more consumers to qualify for the program and feel inclusive in a reward program that actually works. Focusing on customers Classic Airlines choose to move towards the marketing concept, which is finding the right products for the customer (Kotler & Keller, 2012). Fliers have different level options based on the fliers needs, such as basic, silver, and gold member status. Marketing is defined as identifying and meeting human and social needs (Kotler & Keller, 2012). With the marketing concept Classic Airlines has chosen to adopt, they must become effective in administering stellar customer service in order to retain a decreasing flier base. Decisions are usually made top down by executives who don’t fully understand what the customer wants are. Classic Airlines has a strained top down organizational structure with a CEO who does not see the importance of marketing; implementing this concept efficiently could pose a problem for the airline. Each business unit within the company has a different outlook on what’s important for the success for Classic Airlines. The battle internally amongst Classic Airlines management level associates has to come to a common ground for the success of the company. With different business units wanting to take different approaches and not executing on the vision, adds to low employee morale. With unsatisfied associates, customer service is impacted. With a negative impact of customer service, the goal of having an effective marketing concept will not be successful. The internal pressures contributing to Classic Airlines current crisis is low morale amongst associates. Having a workforce that no longer believes in company and the stability of the company causes issues for the company. The service model indicates that an unhappy associate correlates to an unhappy customer. Another internal pressure is lack of support for marketing by senior management. An associate can go no further than the person leading them and having senior management have no regards to the job function of a business unit, sends the wrong message to the associates. This also loops back to internal culture issues that will have a lot of misguided individual effort that isn’t cohesive to the team or what is needed. Union demands for Classic Airlines pilots and servicemen have put a constraint on revenues. The Union relationship has been praised publicly for other airlines to follow but internally it’s a pressure for Classic Airlines to...