...Classic Airlines Marketing Solution Jeanine M. Taylor MKT 571 April 9, 2012 Michael Wilson, MBA Classic Airlines Marketing Solution Classic Airlines is the fifth largest airline in the world with a fleet of more than 375 jets that serve over 240 cities with over 2,300 daily flights. Since it was incepted 25 years ago, the airline has grown to 32,000 employees. Though currently profitable, Classic has not gone unscathed by the challenges faced by the airline industry. Financially, increased uncertainty about flying has resulted in a 10% decrease in Classic’s stock prices. Operationally, the airline is suffering from waning consumer confidence. The airline’s rewards program has lost 19% of its members and the flights booked by the remaining members have decreased 21%. Rising costs, particularly in the area of fuel and labor, have limited the airlines ability to compete for the high value frequent flier. Classic’s board of directors has mandated a 15% cost reduction in all departments over the next 18 months to protect the profitability of the company (University of Phoenix, 2012, Classic Airlines Scenario). Financial success is dependent upon marketing. Without marketing to generate the demand for a product, the company cannot make a profit (Koller & Keller, 2006). Classic’s Chief Executive Officer (CEO), Amanda Miller, has tasked the new Chief Marketing Officer (CMO), Kevin Boyle and his team comprised of the Senior Vice President of Customer Service, Renee Epson...
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...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...
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...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 company...
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...Classic Airlines Marketing Solution MKT/571 June 11, 2012 Karlene Swalley Classic Airlines Marketing Solution Classic Airlines is facing numerous internal and external issues both internal and external. The external and internal marketing problems are affecting the needs and wants of the customers, stakeholders, and the profitability of the company. It is the responsibility of the Marketing department to review and come up with a sound marketing solution to assist with combating the poor sales, and reduced profits of the company and to win back and connect with its customers. The marketing department will employ a problem-solving model to solve Classic Airlines marketing problems. The model will consist of nine steps and it will assist the marketing department with identifying and defining the problem. Then, applying the problem solving process, it will help to aide with the comeback of the company to a thriving business. To be an effective marketing team it is imperative that the stakeholders are involved and that a plan of action is utilized to research the problems that are identified. The following nine step approach to problem solving by Management-Hub (2012) is an effective tool to assist the marketing department. • Develop a problem statement • Identify the potential cause of the problem • Gather data and verify the likely cause • Identify possible solutions • Evaluate alternative solutions • Determine the best solution • Revise the project plan ...
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...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 model...
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...Classic Airlines marketing Solution Student Name MTK/571 Marketing University Name April 2011 Instructor Name Classic Airlines Marketing Solution Classic Airlines is the fifth largest airlines in the world. The company services 240 cities worldwide commanding 2,300 flights daily and has over 375 jets. Classic Airlines has increased the number of its employees to 32,000 over the past 25 years. Classic Airlines earned $10 million on $8.7 billion in sales last year. Competition and the need to gain customer satisfaction necessitated the creation of innovative products and marketing techniques such as frequent flyers and reward programs. Classis Airlines faces increasing challenges similar to all other airlines. Like all other airlines, the challenges range from rising fuel costs, economic turndown, customers’ increased ambiguity about flying, and scrutiny from all sectors including Wall Street, the public, and media. Despite the company’s efforts to reduce cost by employing price cuts, these challenges continue to affect the corporation’s profitability (University of Phoenix, 2011). Furthermore, Classic Airlines’ corporate culture has become dysfunctional. The company stood stagnant while looking for ways to implement new strategies particularly when faced with challenges. To be successful and to meet the challenges, Classic Airlines will need to use the problem solving approach, which will entail employing the nine-step model. The company will need to use its internal...
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...This paper will cover a full scale and analysis of Classic Airlines, a 25 year airline organization. Classic Airlines demand is over 375 jets that serve 240 cities with more than 2300 daily flights making it the fifth largest airline in the world (University of Phoenix, 2007). Classic Airlines has grown from a small business to an organization of 32,000 employees and earned $10 million on $8.7 billion in sales (University of Phoenix). A general problem-solving process or framework provides leaders with a way to begin managing and understanding a wide range of decisions to be made, problems that needs attention, and concerns that arise from internal and external customers. According to University of Phoenix Week Three Scenario (2011), “Classical Airlines has seen a 10% decrease in share prices in the past year,” (para 2.) With this decrease in share prices the rising cost (fuel and labor) have hit the organization hard. The employees’ morale is at a low and Classic’s financial strain the corporate culture is under pressure. The board of directors for Classic Airlines has mandated a 15% cost reduction over the next 18 months. This cost reduction brings some challenges for all departments including finance, human resources, marketing, and customer service. From a marketing point of view, Classic is challenged with increasing customer loyalty and satisfaction, while decreasing expenditures. The first step of the problem-solving method is a key question to ask, “Is all the...
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...Classic Airlines Marketing Solution Classic Airlines is one of the largest airlines in the world. Their routes include more than 240 cities and more than 2,300 flights a day. In 2004, they had a net operating income of $10 million dollars (Classic Airlines Scenario, 2011). Despite this achievement, Classic Airlines has been experiencing many challenges in operations that are threatening their profitability. These challenges include increased competition, higher overhead costs, decreased employee morale, dwindling stock prices, shrinking consumer confidence, market uncertainty, and customer dissatisfaction. Classic Airlines could use the nine-step problem-solving model to find the true cause of these symptoms and rectify the problem. Profitability will increase once the true problem is solved effectively. According to the Critical Thinking textbook, “Problem solving is applying critical thinking to achieve the goals and personal harmony that are important in our personal and professional lives” (Kirby & Goodpaster, 1999, p. 251). There are many approaches to problem solving. We will use the nine-step model described in Problem Solving-Based Scenarios (Problem Solving-Based Scenarios, 2011). The first step is to describe the situation. Classic Airlines has experienced a 10% decline in share prices. Customer surveys show that they are becoming dissatisfied with the airline’s customer service and frequent flier program, Classic Rewards. Rewards membership has decreased...
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...Running head: PROBLEM SOLUTION: CLASSIC AIRLINES Problem Solution: Classic Airlines University of Phoenix January 21, 2008 Problem Solution: Classic Airlines “Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders” (Kerin, 2006). Marketing is a fundamental key to any businesses success and involves determining the needs, wants and desires of consumers and satisfying them to the best ability. Classic Airlines is the world’s fifth largest airline they command 375 jets serving 240 cities with about 2300 flights per day for about a quarter of a century. Classic Airlines has around 32,000 employees. They earned about $10 million on about $8.7 billion in sales. With the uncertainty about flying Classic Airlines and the industry has seen this affect stock prices, Classic Airlines in particular has seen a 10% decrease in their share prices over the past year. Classic Airlines is also dealing with low employee morale, and the consumers’ confidence also seems to be declining as well. (Anonymous, 2007a) According to their financials for the past year, Classic Airlines would have been losing money if it were not for the $15 billion aid package passed by Congress for the airline industry (Kaye, 2002), which is resulting in a $22 million Income Tax Provision...
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...Classic Airline’s Marketing Problem Resolution Classic Airline’s Marketing Problem Resolution Classic Airline’s has been one of the top five airlines for over the last 25 years. They have had many loyal fliers over the years until recently. Many of their loyal fliers who remained a part of their Classic Rewards program aren’t even always choosing Classic Airlines as their means of air travel. They have come to the conclusion that their current Customer Relations Management system (CRM); the Classic Rewards program; isn’t working to the point that it isn’t keeping current customers or attracting new ones. Classic Airlines must find a way to reestablish their Classic Rewards program so that it will beneficial towards keeping them one of the leading airlines. Through intensive market research and a commitment towards understanding what their customers want by analyzing customer feedback; Classic Airlines will improve their customer loyalty and raise customer value. In order to reestablish Classic Airlines Classic Rewards program as a great marketing tool for the company, they will need to commit to a nine-step problem solving model. A nine-step problem solving model is a structured process in which each step is designed to lead to a predetermined set of results or to find the reason a process is failing. Classic Airlines will use the problem solving model to help them turnaround their Classic Rewards program by identifying the failures of the current system and offering alternatives...
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...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 the...
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...Classic Airlines Problem-Solving Process Barbara Terry MKT/571 – Marketing April 10, 2012 Clifford M. Lavin MSIM University of Phoenix Classic Airlines Problem-Solving Process Classic Airlines, one of the largest airline carriers in the world, servicing 240 cities, and more than 2,300 flights every day is in the service industry (UOPX Classic Airlines scenario, 2012). Classic Airlines is making a profit; however, its share prices have decreased 10% in the past year alone, and its customer base is also on the decline. This year the company had a net income of 10 million, whereas the previous year they had a net income of $71 million (UOPX Classic Airlines scenario, 2012). There are numerous internal and external factors contributing to Classic Airline’s current predicament. Decreasing stock prices, rising fuel costs, and declining consumer confidence are a few of the challenges the airline is facing. Additionally, internal disagreement among upper management is causing a direct problem to the Marketing team. Air travel around the globe is steadily increasing, and many people fly because it is necessary, however; minimal research has been conducted on how stress is related to people who fly frequently (Mawhinney, 2007). Classic Airlines management must take proactive measures, and conduct some in-depth research to determine the root cause of the current dilemmas. The purpose of this...
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...Classic Airlines is up against not just one challenge but several challenges they need to deal with. Unfortunately travel has decreased as a result of uncertainty with regards to flying; this has forced the stock prices to be reduce decreasing the price of a share of Classic Airlines stock by 10% over the previous year. The negative messages being conveyed by Wall Street and the media is bringing employee morale down to an all time low. Consumer confidence in the airline has resulted in a 19% decrease in Classic flight reward members which in turn has decreased flights by loyal members by 21%. The rising cost of fuel and labor as a result of economic times is preventing Classic from competing to regain its lost customers. In an attempt to balance out their financial loses and cut down on any further financial crunches, the board of directors is mandating a 15% cost reduction but expects the marketing strategies to be beefed up to bring in more profitable return on investments of the frequent flyer program. This plan is being put into action to prevent bankruptcies of the airlines. Classic Airlines needs a begin with their business mission then move on to a strategic plan. The strategic plan will layout, based on analysis, what areas of the airline market has the most promising opportunities. The next step is a tactical marketing plan that will help to point out promotions that could be featured and services they could offer to bring lost customers back as well as to draw new...
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...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 committed...
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...Mkt 571 Week 6 Final Exam Classic Airlines Marketing Solution MKT/571 Classic Airlines Marketing Solution Classic Airlines Classic Airlines (CA) is the 5th largest airline enterprise in the world that is comprised of more than 375 jets that travel to 240 cities and run in excess of 2,300 flights daily (University of Phoenix, 2012). 25 years following its inception, CA has grown to employ 32,000 people. Last year, CA earned over $10 million profit on $8.7 billion in sales (University of Phoenix, 2012). However, CA has been noticing some negative changes recently. In the last year, the Classic Rewards Program saw a 19% decline in the number of members and the existing members purchased 21% less flights (University of Phoenix, 2012). Increased expenses, the most important of which are fuel and labor, have had a negative impact on the corporation and employee morale is at an all time low due to increased scrutiny on the airline industries from all sectors of the economy, not simply the airline industry. According to the American Marketing Association Board of Directors (2012), “Marketing is the activity, set of institutions, and processes for creating, communicating, and exchanging offerings that have value for customers, clients, partners and society at large (Definition of Marketing, para. 2). Economic conditions have amplified CA’s financial strain. CA can not afford to decrease the ticket prices past the current price or they will face bankruptcy. This is unfortunate...
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