The features of United Airlines’ strategy are: three classes: first, premium and economy, reduction of total number of seats, reduction of economy class seats , price increase for “extra legroom” seats and for economy class seats, decreasing the weight limit for economy class passengers’ baggage, increasing the weight limit for premium and first class passengers’ baggage.
The features of American Airlines’ strategy are: two classes: first and economy, extra legroom for economy class seats, reduction of total number of seats, reduction of economy class seats , prices for economy class seats don’t change , weight limit for baggage doesn’t change.
The reaction of competitors was different. British Airways chose strategy similar to United Airlines by creating ‘world traveler plus’ class with extra legroom seats. No pricing information is announced.
Continental Airlines doesn’t support the idea of creating extra legroom seats for the company believes that the main criterion for passengers is PRICE.
Delta Air lines takes neutral position. The company waits for the results of its competitors’ strategies.
In order to estimate the importance of such criterion as extra legroom, I held two surveys among students and business people. They listed top 5 criteria important for them while choosing airline company. (The lists of criteria is presented at 5-6 slides).
The surveys showed that the main criterion for students is Price. They prefer the cheapest airlines, others criteria are not so important. No one mentioned extra legroom criterion as important.
The main criterion for businessmen is Schedule. Business people have to travel a lot all over the world so it is important to travel fast. That’s why they usually chose those airlines where the schedule of flights is suitable for them.
Both respondents have chose such criteria as : flight time and online booking.
One of the tasks was to compare the pricing strategies of United Airlines and American Airlines, I mentioned all steps in strategies chains. (They are presented at 8-9 slides).
The mission of both companies is increase in profit, the difference is in means.
United Airlines’ customers are business people and those who like and can afford themselves comfort. The number of customers that’s why is fewer and the probability of attracting new customers is low.
American Airlines’ customers are both business people and ordinary people. The number of customers is very large. The new strategy help to attract new customers.
The pricing strategy of American Airlines' is superior for it helps to attract new customers and make them loyal to the company. The chosen strategy shows positive image of the company.
United Airlines and American Airlines differs in their influence on customers decision-making.
United Airlines is attempting to influence customers’ decision making by implementing image of “premium class” company. That’s why the management of the company is attempting to get it’s positional customers.
American Airlines is attempting to influence customers’ decision making by keeping its prices at the same level and implementing the image of “caring company” which satisfies all the customers needs.
British Airways is attempting to influence customers’ decision making by the same strategy as United Airlines does.
Above it was said, that the reaction of competitors was different. According to the survey held among students and business people extra legroom space is not the main criterion. That’s why the position of Continental Airlines is understandable. Continental Airlines doesn’t share the idea of providing their passengers with extra legroom space because their customers often chose its airline for cheapest prices. The main criterion for ordinary people is the price of the ticket.
According to the survey held among students and business people extra legroom space is not the main criterion. That’s why the position of Continental Airlines is understandable. Continental Airlines doesn’t share the idea of providing their passengers with extra legroom space because their customers often chose its airline for cheapest prices. The main criterion for ordinary people is the price of the ticket.
