The Nature of the Marketing Problem
Promoting the business was the major problem that the new airline had to overcome if it had to achieve success in its operations. Other than the need to hire an advertising agency to handle publicity and public relations issues, Southwest Airlines was yet to evaluate and/or conduct an analysis of the Texas airline industry. Analysis of the image of each independent career with respect to the quality of their advertising and promotional effects became an overriding issue for Southwest Airline. While the Company needed to come up with a detailed and innovative marketing strategy, designing the ideal personality description model was essential in order to differentiate the new airline from others in the industry became a significant factor (p. 7). Simply put, advertising and promotional activities including relevant budgetary allocations became the vital factors that influenced the nature of marketing for Southwest Airline (8).
Question 2
Many a customer purchasing decisions and consumption behaviors are influenced by a plethora of factors. First, the ticket or flight prices forms one of the major determinants of consumers purchase decisions given that frequent flyers of look for low prices or discounted prices. The effects of discounted or half-price fares enabled SWA to regain control of low-market areas such as the Southwest’s Dallas-San Antonio routes that were scheduled for discontinuation. For instances, extension of discounted flights on Fridays attracted more business as compared to other standard-priced flights. Second, the strength and quality of promotional activities plays a pivotal role in influencing customer consumption patterns and purchase decisions. This is evidenced from the ability of Southwest Airline to enter the market and sustain competition through strengthened reinforcements of the company’s image. Third, improved public relations and mass communication plan ensured that efficiency and efficacy is received within the airline and thus, serving customers became an easy process. Fourth, the image of the organization and brand equity influences customers purchasing decisions. Last, customer service and on-board services are some of the factors that improve the overall customer experience and purchasing decisions.
Question 3
Segmentation exists in the Airline industry depending on a number of factors that include discounted fares, regular fares, level of comfort and service, and passenger volume. Discounted fares involve offering special discounts on fares on certain roots for specific periods. Such roots are either competitive or less travelled by passengers and hence, incentives are needed to attract passengers to such roots. Regular flights mainly involve those routes and schedule whose fares are determined based on the prevailing market conditions. Speaking of the level of comfort and service, customers are categorized into different categories depending on the level of comfort or service they desire. For instance, consumers in the first class service or VIP category receive specialized treatment and extra comfort as compared to those passengers in the ordinary or economy class. Finally, passenger volume determines the number of flights, route structure, and pricing requirements. Airline companies often offer discounted rates to less frequented routes as compared to more frequented roots.
Question 4
a)
In Early 1971, the Southwest market was characterized by high cases of flight cancellations and difficulty in getting flight reservations. Braniff and TI did not satisfy the flight needs and demands of customers very well due to increased cases of unscheduled flights, and punctuality problems. Additionally, these airlines offered interline traffic thereby creating less space for local passengers. However, they seemed to do well in the introduction of free on-board drinks and reduced fares.
b)
In January 1973, Braniff had introduced half-price fares thereby enabling it to increase the total number of flights in every route. They seemed to satisfy the needs of the customers judging from the increased number of passenger per flight.
Question 5
Southwest Airline marketing mix can be evaluated based on four elements of the marketing mix; price, place, promotion, and product. Pricing of flights such as discounted fares and half-price fares enabled Southwest Airline to increase its market share in those routes that were dominated by its strongest competitors. Place entails the selection of the Southwest region as the ideal location for setting up business. This was a fundamental decision owing to the large number of passengers who frequented this route and as well, the availability of marketing opportunity in this route. Equally, massive advertising and promotional activities undertaken by the company contributed immensely to the success and popularity of SWA. In fact, advertising and promotional activities solved the major marketing challenges that hindered the company by the time it commenced its operations in the region.
Question 6
Since the company was making profits on this route, the management team should consider countering Braniff’s by offering the same “60-Day-Half-price-sale” all flights on the Dallas-Houston (Hobby) route. To minimize losses occurring from the Dallas-San Antonio route, SWA should consider maintaining its “60-Day-half-price-Sale” on this route as well since the major competitor had made no similar offer. This will enable the company to increase sales from this route while maintaining sales from the Dallas-Houston (Hobby) route.
Work Cited
Southwest Airlines Harvard Case Study. Harvard Business School. 1985.
