MARKETING SPOTLIGHT- SOUTHWEST AIRLINES Southwest Airlines entered the airline industry in 1971 with little money‚ but lots of personality. Marketing itself as the LUV airline‚ the company featured a bright red heart as its first logo. In the 1970s‚ flight attendants in red-orange hot pants served Love Bites (peanuts) and Love Potions (drinks). With little money for advertising in the early days‚ Southwest relied on its outrageous antics to generate word-of-mouth advertising. Later ads showcased
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Southwest Airlines’ Seven Secrets for Success What’s the airline-industry jargon for unconventional wisdom? Southwest Airlines. By some estimates‚ the country’s major carriers have consumed perhaps $100 billion in capital during the past decade‚ but Southwest Airlines continues to be profitable. It’s been in the black for 33 consecutive years and‚ last week‚ for the 127th consecutive quarter‚ it paid a modest dividend. Its balance sheet‚ with about $3 billion in cash on hand and $600 million
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The domestic US airline industry has been intensely competitive since it was deregulated in 1978. In a regulated environment‚ most of the cost increases were passed along to consumers under a fixed rate-of-return based pricing scheme. This allowed labor unions to acquire a lot of power and workers at the major incumbent carriers were overpaid. After deregulation‚ the incumbent carriers felt the most pain‚ and the floodgates had opened for newer more nimble carriers with lower cost structures
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Southwest Airline Case ¨C Executive Summary Introduction in 1971‚ Herbert D. Kelleher with other few business partners started an Airline services. Up till 1991‚ Southwest served low-fair air transportation among 32 cities in 14 states with over 20 million customers annually in the United States. Although the industry suffered a major blow from the unfavorable economic conditions‚ the company was still holding strong; while other airline companies were in debt. The major success to their continued
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Southwest History 1966: Rollin King marched into Herb Kelleher’s law office with a plan to start a low-cost/low-fare airline that would shuttle passengers between San Antonio‚ Dallas‚ and Houston. Thought of this idea because businessmen were complaining about the commute. 1967: Kelleher filed papers to incorporate the new airline and submitted an application to the Texas Aeronautics Commission for the new company to serve Dallas‚ Houston‚ and San Antonio. ------4 year legal and regulatory
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Southwest and Continental Airlines: A Managerial Economic Perspective Introduction In order for companies to maximize profits and productivity‚ it is important that they implement managerial economics on both a day-to-day and strategic basis. This paper will compare and contrast Southwest and Continental Airlines from a managerial economic perspective. The goal of the paper is to critically analyze both companies on their use of managerial economic practices. The Airline industry is a capitally
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Case Analysis Southwest Airlines and Gary Kelly Oscar A. Anzaldua Davenport University Southwest Airlines Company is a well-known low-cost American airline that offers excellent customer and employee service. As of 2009 Southwest is the largest airline company in the world that carries the most number of passengers and it is the third largest passenger fleet of aircraft among the world’s commercial airlines. It also boasts the highest number of customers than any other airlines in the United
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At the onset of the airline industry in the United States‚ major network airlines were the sole providers of air travel. This multifaceted industry was a difficult industry to break into as a consequence of “sophisticated customer segmentation‚ hub-and spoke models and costly information systems for reservations‚ fare wars and intense competition” (Thompson 2008). Shrinkage in airline ticket prices augmented the demand for airline travel. Many markets were simply deserted or over-looked by major
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Southwest Airlines: A Corporate Cultural Assessment University of X September 17‚ 2005 Southwest Airlines: A Corporate Cultural Assessment Southwest Airlines (Southwest) is a domestic US airline that provides short haul‚ high frequency‚ point-to-point‚ and low-fare service to and from 60 airports in 59 cities across 31 US states. From humble beginnings in 1971‚ this airline with only four passengers per flight‚ and airhostesses wearing hot pants and white go-go boots‚ has evolved into a leader
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Abstract Airline companies are facing many challenges keeping their cost down and profits up. Some of the main issues are gas prices and pilots pay. CEO of Southwest Airlines‚ Gary Kelly‚ has been able to work with fuel companies to provide one of the lowest costs for gas than any other company. With his great knowledge and social personality‚ he has been a very effective leader for Southwest. The company’s core competencies is treating their customers with respect and showing them that they are
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