Classic Airlines Marketing

Classic Airlines Marketing Solution
As the world’s fifth largest airline, Classic Airlines serves over 240 cities with more than 2300 daily flights. Facing high fuel cost, tight competition, and low customer satisfaction, Classic airlines currently experiences difficulties to maintain its effective operation. The September 11 terrorist attack in the United States has also affected travelers, as they prefer other transportation means and use air travel less. As the global economy becomes weaken, the airline industry has been under pressure to control costs by cutting down customers’ services program. The paper will examine Classic Airlines current situation and focus on challenges, opportunities, external and internal pressures on marketing. By providing a clear problem statement, using SMART end-state goals and benchmark, recommendations will be made to solve the marketing problem at Classic Airlines.
To improve the customer’s services, the airline must utilize its Customer Relationship Management (CRM) system to learn about its customers and their needs. Although Amanda Miller, Classic Airline’s CEO, tends to focus on the overall cost cutting process, other management team members believe the airlines can improve by applying more marketing concepts (University of Phoenix, 2007). There is not much room left for reducing ticket prices. The main focus for the airlines still involve with its customers and the frequent flyer program. Currently, the airlines share price has been reduced by 10%, while the Classic’s Rewards program decreases 19% in memberships.   Using relationship marketing, the airline can recover by rebuilding its customer relationship. In essence, customer satisfaction can be expected to increase customer loyalty, reduce price elasticity, lower transaction costs, and improve the company’s image (Andersen et al., 1994). The airline travel industry has been attempting to keep costs down while trying to improve services. In the...