1. How does Southwest add value? What makes southwest different from just “any airline”?
Southwest airlines is unique because of its policy of not following conventional rule set up by other players in the airline industry. It adds value by not serving meals and avoiding handling baggage between airlines making a profit margin of 6% making them most consistent, profitable and fastest growing airline resulting to value addition. It is different since it has the best baggage service and has received few customer complaints. It also takes 15-20 minutes to turn plane around as opposed to the usual 45minutes in other airlines. In addition, the company adds value by developing a customer friendly attitude and a focus on equality of people with low prices.
2. How would you describe the competitive priorities of Southwest? How does this differ from other airlines?
South West has been able to say competitive by focusing on lowest cost in the airline business. The company does not have a hub but has 30 cities point to point thus maximizing output. In addition, it charges the lowest possible fair for in the industry. It has best baggage service and shortest turnaround time reducing time wastage in turning thus attracting more customers. Other airlines charge fee for baggage for domestic flights and takes 40 -45 minutes (twice as much) to turn around and set off the journey. Similarly, the company prides of having the most productive workers in the industry.
3. Is Southwest for all traveling customers? Why or why not?
No. Southwest is made for a specific niche of customer. First class travelers are not treated any differently from the rest of the travelers. The company does not discriminate on customers based earning power and this makes it popular for most common folks. However, the company does not fly to all major airports thus locking out travelers form those regions.
4.During Herb Kelleher’s interview in the video, what did he state was his unique pricing strategy to explain his incredibly low airfares (i.e., how did he decide how little to charge for fares)?
Herb Keller said that his pricing strategy depends on focusing on a strategy that allows the company to target the common folks in the market. This means that he beats the high cost of running businesses by the choice of planes used. The choice of the plane to fly often depends on planes with simple and fewer maintenance costs are flown thus reducing expenses. With low expenses, they can decide on low prices resulting to more customers attracted raising revenues. In addition, they charge low fair to capture on for big volumes thus saving 25 million dollars a year.
5. Why is it important for Southwest to maintain its culture of humor on its flights?
6. Given that Southwest is the only major U.S. carrier that doesn’t charge for luggage, they are missing out on easy money, or are they? What is your take on this decision?
No. With no fee on luggage, they attract more customers with and without luggage hence more customers raising the revenue that they missed from the luggage.
7. To what do you attribute the success of Southwest airlines?
Less crowded airports’ strategy that makes them make many trips within a day with efficient operations. Best deals in terms of t baggage services and good customer services provided resulting to fewer customer complaints.
8. What challenges is southwest facing in the future and how should they meet those challenges?
Flight delays. Competition from other airlines To curb delays not related to weather, proper maintenance of the planes should be ensured. They should also insist on efficiency in the airline operations.
