Classic Airlines and Marketing Concepts

Classic Airlines and Marketing

The first purpose of marketing is to sell products or services by obtaining attention from potential or current customers. If an organization expects long-term profits and maintains their customers based on loyalty, an organization should understand that marketing requires continuous customer management and understand their customers’ needs and wants to establish long-term customer relationship. This paper will discover the marketing challenges, and corporate culture along with marketing concepts that a company can adapt to get over a situation the company may face.

Challenges and corporate culture

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Classic Airlines has faced a negative business environment that has affected the company’s profits such as an increase of labor and fuel costs along with a decrease in stock price, and a number of Classic Airline rewards program showing customers’ loyalty (University of Phoenix, 2010, Week One Supplement).

The CEO and CFO of Classic Airlines believe that the company can overcome the negative situation by implementing a cost reduction program and price will be the top priority when customers choose the airline. However, the rest of management members believe that Classic Airlines should implement a customer-oriented marketing management program to re-establish company’s position in airline industry. The management groups have extremely different views to solve the problems for accomplishing the company’s goals. In this scenario, employees believe that top management has not listened to employees’ suggestions to solve the problems. The company does not share the same values and blames each other on issues that Classic Airlines is facing.

Marketing concept

Kotler and Keller (2006) stated, “Marketing concept holds that the key to achieving organizational goals consists of the company being more effective than competitors in creating, delivering, and communicating superior customer value to its chosen target markets” (p. 16). In this scenario, CMO and team strive to re-build the customer relationship by implementing a new strategy by listening customers’ demands and wants, and develop an effective customer relationship management program so the company can get back customers whom left to other competitors by satisfying their lost customers. To find out customers’ needs and wants, the customer service department conducts customer interviews with existing and former top-level frequent flyers (University of Phoenix, 2010, Week One Supplement).

Production Concept

The Classic Airlines scenario shows the production concept. Kotler and Keller (2006) stated, “Production concepts holds that consumers will prefer products that are widely available and inexpensive” (p. 15). The Classic Airlines had cut airfare in 2004; the company cannot lower the price further to survive in the severe price war to attract customers to Classic Airlines.

Product concept

Kolter and Keller (2006) stated, “Consumers will favor those products that offer the most quality, performance, or innovative feature” (p. 15). The CMO believe that a price is not the top priority when customers choose the airlines based on conversions with customers. When Classic Airlines provides satisfied service to customers, customers will choose the Classic Airlines.

Target Market, Positioning, and Segmentation

Classic Airlines shows target market, positioning, and segmentation marketing concepts.

Classic Airlines develops segmentation strategy to identify the needs and wants from different groups that are leisure and business travelers in this scenario. The segmentation strategy allows Classic Airlines to have a different targeting plan by analyzing demographics, behaviors, personalities, and lifestyles in their customer groups (University of Phoenix, 2010, Week One Supplement). Classic Airlines can provide a differentiated service to customers based on their needs and wants.

Relationship marketing

Kotler and Keller stated (2006), “Relationship marketing has the aim of building mutually satisfying long-term relationship with key parties – customer, supplies, distributors, and other marketing partners to earn and retain their business” (p. 18). CMO and team strive to make marketing alliances with other airplane partners to bring up the customer loyalty by providing convenience using a single network.

Conclusion

Marketing is the way to communicate with customers and provides an opportunity to analyze customers, competitors, and market trends. Marketing helps identify for the company what customers needs and wants are, understanding those needs and wants helps the company obtain customers’ satisfaction and in turn allow the company to be competitive and profitable for the long-term.

Reference

• University of Phoenix. (2010). Week One supplement: Exhibit A. Retrieved October 25, 2010, from University of Phoenix, Week One, MKT/571-Marketing Course Web site.
• Kolter, P., & Keller, K.L. (2006). Marketing management (12th ed.). New Jersey: Pearson-Prentice Hall

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