Running head: CLASSIS AIRLINES AND MARKETING

Classic Airlines and Marketing
Classic Airlines is the fifth largest airline in the world with annual earnings of $10 million. After being in business for 25 years, they have amassed more than 375 jets with 2,300 flights daily (University of Phoenix, 2010). Even with this success, there are concerns for their financial stability. The challenges facing Classic Airlines are common among airline companies. These challenges include stock instability, low employee morale, pubic uncertainty about flying; declining rewards program membership, increasing costs for labor and fuel along with a recent directive to reduce 15% over the next 18 months. This leads to major concerns by the management team. To reach stable ground, the management team will attempt to improve and increase the value of the rewards program, enticing previous members back while ensuring retention of current members. Rewards programs can be detrimental to the success of a business, according to Furinto, Pawitra and Baliah “Programs that are perceived favorably by consumers will in turn create stronger attitudinal loyalty and higher consumer profitability” (p. 307, 2009).
The Small Business Administration suggests that “marketing activities and strategies result in making products available that satisfy consumers while making profits for the company” (para. 1, Market and Price). The goal of marketing is to use resources to increase the number of consumers while improving their perception of services and products. These goals also support meeting stated goals and objectives (Wienclaw, 2009). Marketing is a functional part of a business that encompasses all departments. The other functions of a business (finance, production, accounting, operation) will not matter if the demand for the product or service is not sufficient. Effective marketing