Southeast Airline Case Analysis
CASE REPORT #7
GROUP 10
(按姓氏首字母排序) 黄昕 靳子仪 刘静 刘天娇 王小茜
2011/5/3
CASE REPORT #7：
Southwest Airlines: Waging War in Philly Case Briefing：
In May 2004, Southwest Airlines’ new line in Philadelphia began to operate, which triggered enormous commotion in the existing airline industry—especially US Airways. Southwest Airlines is famous for its low cost strategy, which goes against the industry’s conventional wisdom (See Form 1 below). Having persisted in its strategy, Southwest expended quickly, becoming the most popular airlines which boarded more domestic customers than any other airlines in US. While Southwest Airlines kept growing continuously, indicated as one of the nation’s best-performing stocks, the major airlines of US has stuck with the problems as their high cost structures make them difficult to change while many other small airlines begin to adopted Southwest-like strategies and began to capturing more and more market shares. Form 1 Southwest Airlines’ Strategy vs. Conventional Strategy Southwest Airlines—low cost strategy Fly Pattern Meal Change Fee Point-to-point No meal, only snacks No charge for changing same-fare tickets Seats No assigned seats Choose seat beforehand Electronic entertainment Retirement plan, including pension and health benefits Hub-and-spoke Formal meals Extra fee for ticket-changing Industry’s conventional strategy
Entertainment Comic flight attendants Employees’ Benefits Profit-sharing, but no retirement plan
In order to emulate the success in US, Southwest Airlines made new promotion plan particular for Philly to deal with the factors that work against Southwest’s strategy of 20-minute turnarounds for its planes. Southwest assigned 50% more employees to the airport than it would in a customary launch and developed a more
1 / 10
CASE REPORT #7： intense ad campaign aiming at intensify Southwest’s unique low-cost image in the public eye. Although Southwest has done a lot in Philly, it still faces furious
GROUP 10
(按姓氏首字母排序) 黄昕 靳子仪 刘静 刘天娇 王小茜
2011/5/3
CASE REPORT #7：
Southwest Airlines: Waging War in Philly Case Briefing：
In May 2004, Southwest Airlines’ new line in Philadelphia began to operate, which triggered enormous commotion in the existing airline industry—especially US Airways. Southwest Airlines is famous for its low cost strategy, which goes against the industry’s conventional wisdom (See Form 1 below). Having persisted in its strategy, Southwest expended quickly, becoming the most popular airlines which boarded more domestic customers than any other airlines in US. While Southwest Airlines kept growing continuously, indicated as one of the nation’s best-performing stocks, the major airlines of US has stuck with the problems as their high cost structures make them difficult to change while many other small airlines begin to adopted Southwest-like strategies and began to capturing more and more market shares. Form 1 Southwest Airlines’ Strategy vs. Conventional Strategy Southwest Airlines—low cost strategy Fly Pattern Meal Change Fee Point-to-point No meal, only snacks No charge for changing same-fare tickets Seats No assigned seats Choose seat beforehand Electronic entertainment Retirement plan, including pension and health benefits Hub-and-spoke Formal meals Extra fee for ticket-changing Industry’s conventional strategy
Entertainment Comic flight attendants Employees’ Benefits Profit-sharing, but no retirement plan
In order to emulate the success in US, Southwest Airlines made new promotion plan particular for Philly to deal with the factors that work against Southwest’s strategy of 20-minute turnarounds for its planes. Southwest assigned 50% more employees to the airport than it would in a customary launch and developed a more
1 / 10
CASE REPORT #7： intense ad campaign aiming at intensify Southwest’s unique low-cost image in the public eye. Although Southwest has done a lot in Philly, it still faces furious