...April 25, 2011 Dr. Bea Bourne Marketing Solution Classic Airlines, one of the largest airlines in the country, “commands a fleet of more than 375 jets that serve 240 cities with over 2,300 daily flights” (University of Phoenix, Classic Airline Scenario, 2011) and has gained 32,000 employees with earnings of $8.7 billion in sales. September 11, 2001 was the start of the economic crisis for the airlines, along with the rising costs of operations. Classic Airlines has internal and external factors, which also contribute to the airline’s crisis. Addressing the crisis, Classic Airlines should consider using a ten-step basic problem-solving method as well as seek suggestions from the airlines internal and external resources. Define the Problem The first step in the method is defining Classic Airlines problem by determining the purpose of the project. Classic Airline’s shares are declining even though the airlines still earn a profit. A problem found is Classic Airline’s reward program offered to customers has declined, which could be because the customers are traveling less because of the economic times or the customers are traveling on other airlines. The decline could also be linked to the lack of customer satisfaction. Employee morale is another contributing factor to the airlines problems. The morale has decreased because of the September 11, 2001 attacks, referred to as 9/11. After 9/11 the airline was criticize for the lack of attention to security and...
Words: 2193 - Pages: 9
...Classic Airlines marketing Solution Student Name MTK/571 Marketing University Name April 2011 Instructor Name Classic Airlines Marketing Solution Classic Airlines is the fifth largest airlines in the world. The company services 240 cities worldwide commanding 2,300 flights daily and has over 375 jets. Classic Airlines has increased the number of its employees to 32,000 over the past 25 years. Classic Airlines earned $10 million on $8.7 billion in sales last year. Competition and the need to gain customer satisfaction necessitated the creation of innovative products and marketing techniques such as frequent flyers and reward programs. Classis Airlines faces increasing challenges similar to all other airlines. Like all other airlines, the challenges range from rising fuel costs, economic turndown, customers’ increased ambiguity about flying, and scrutiny from all sectors including Wall Street, the public, and media. Despite the company’s efforts to reduce cost by employing price cuts, these challenges continue to affect the corporation’s profitability (University of Phoenix, 2011). Furthermore, Classic Airlines’ corporate culture has become dysfunctional. The company stood stagnant while looking for ways to implement new strategies particularly when faced with challenges. To be successful and to meet the challenges, Classic Airlines will need to use the problem solving approach, which will entail employing the nine-step model. The company will need to use its internal...
Words: 2004 - Pages: 9
...Classic Airlines is facing the same issues that many organizations are faced with which is providing increased value to their customers with a tighter budget, as the fifth largest airline Classic airlines has had declining profits and their stock prices have fallen this has adversely affected the organization. To make matters worse Classic Airlines has lost 19 percent of their Classic reward members; and the members they have left are flying with Classic even less these days (UOP Portal, Classic Airlines, 2011). This has forced the company to restructure based on extreme competition and the declining metrics disclosed from their customer loyalty report. Chief Executive Officer Amanda Miller has tasked the leadership teams to make improvements to the frequent flier program that will promote positive returns. The board of directors recently mandated a 15 percent cost reduction across the board that will be in effect for the next 18 months. To achieve this task Classic will need to analyze feedback from customers and understand their objectives and align those with their long term goals. The issues and opportunities present in Classic airlines will be addressed as well as any ethical dilemmas or stakeholder perspectives that need to be addressed. The problem definition and the end state vision will be discussed and the optimal solution will be proposed for Classic Airlines. Issue and Opportunity Identification Classic Airlines has several issues that they need to address...
Words: 2665 - Pages: 11
...SOLUTION: CLASSIC AIRLINES Problem Solution: Classic Airlines Problem Solution: Classic Airlines Classic Airlines has established themselves as the fifth largest airline within their 25 years of existence. Recently they have experienced a 10% decrease in share prices and are faced with a challenge of expanding their frequent flier program using methods that will demonstrate a return on the investment. Classic Airlines will first take a dive into the environmental factors of social, economic, technological, competitive and regulatory forces in order to determine the right problem. (Kerin 2005) “These five forces may sometimes serve as accelerators or brakes on marketing, sometimes expanding an organization’s marketing opportunities and other times restrict them.” Ultimately Classic Airlines will reach the point where they value their customer’s needs. Airlines will always be in demand; therefore it is imperative Classic Airlines develop a marketing plan that will ultimately keep the airlines ahead of the competition. Describe the Situation Issue and Opportunity Identification Classic Airlines has experienced a 10% decrease in share prices over the past year, along with a 19% decrease in Classic Rewards members, and 21% decrease in flights amongst remaining members. Classic Airlines Employees are experiencing low morale issues from the media input of the state of Classic Airlines. Although the Customer Relationship Management (CRM) system was inputted at Classic Airlines...
Words: 2160 - Pages: 9
...Classic Airlines Marketing Solution Classic Airlines is one of the largest airlines in the world. Their routes include more than 240 cities and more than 2,300 flights a day. In 2004, they had a net operating income of $10 million dollars (Classic Airlines Scenario, 2011). Despite this achievement, Classic Airlines has been experiencing many challenges in operations that are threatening their profitability. These challenges include increased competition, higher overhead costs, decreased employee morale, dwindling stock prices, shrinking consumer confidence, market uncertainty, and customer dissatisfaction. Classic Airlines could use the nine-step problem-solving model to find the true cause of these symptoms and rectify the problem. Profitability will increase once the true problem is solved effectively. According to the Critical Thinking textbook, “Problem solving is applying critical thinking to achieve the goals and personal harmony that are important in our personal and professional lives” (Kirby & Goodpaster, 1999, p. 251). There are many approaches to problem solving. We will use the nine-step model described in Problem Solving-Based Scenarios (Problem Solving-Based Scenarios, 2011). The first step is to describe the situation. Classic Airlines has experienced a 10% decline in share prices. Customer surveys show that they are becoming dissatisfied with the airline’s customer service and frequent flier program, Classic Rewards. Rewards membership has decreased...
Words: 2340 - Pages: 10
...Introduction ________________________________________ Classic Airlines is the fifth largest airline in the world and it commands a fleet of 375 and above jets that serve approximately 240 cities on daily flights that are around 2, 300. Classic Airlines was incepted 25 years ago and since then, it has grown into a large organization of almost 32,000 employees. Despite the high rate of profitability of Classic Airlines, challenges that affect today’s Airlines are inevitable. Some of the challenges include uncertainty about flying which has greatly affected stock prices. ________________________________________ The other challenge is consumer confidence that has greatly decreased probably due to increased negativity from the public, media and even Wall Street. Classic Airlines desire is to boost employee and consumer confidence and this is through increasing employee and customer satisfaction and keeping down costs. This research paper will use Classic Airline scenario to present the current issues and opportunities, identify a marketing problem, describe the end state vision and finally identify solutions to the problem. ________________________________________ Discussion Identification of issues and Opportunities The marketing activities of Classic Airlines are influenced by several factors and some of these factors are uncontrolled. It is evident that the company is faced with rising costs of labor and fuel which has led to cutting of costs through better efficiency...
Words: 2966 - Pages: 12
...2011 University of Phoenix Marketing Solution Classic Airlines, one of the largest airlines in the country, “commands a fleet of more than 375 jets that serve 240 cities with over 2,300 daily flights” (University of Phoenix, Classic Airline Scenario, 2011) and has gained 32,000 employees with earnings of $8.7 billion in sales. September 11, 2001 was the start of the economic crisis for the airlines, along with the rising costs of operations. Classic Airlines has internal and external factors, which also contribute to the airline’s crisis. Addressing the crisis, Classic Airlines should consider using a ten-step basic problem-solving method as well as seek suggestions from the airlines internal and external resources. Define the Problem The first step in the method is defining Classic Airlines problem by determining the purpose of the project. Classic Airline’s shares are declining even though the airlines still earn a profit. A problem found is Classic Airline’s reward program offered to customers has declined, which could be because the customers are traveling less because of the economic times or the customers are traveling on other airlines. The decline could also be linked to the lack of customer satisfaction. Employee morale is another contributing factor to the airlines problems. The morale has decreased because of the September 11, 2001 attacks, referred to as 9/11. After 9/11 the airline was criticize for the lack of attention to security and...
Words: 2193 - Pages: 9
...Classic Airlines Marketing Solution Classic Airlines is the sphere's fifth leading airline by way of a fleet of more than 375 jets, serving 240 cities (Keller & Kotler, 2007), using additional 2300 flights daily. The airline has developed into an organization of 32,000 employees from exemption of 25 years ago. The corporation has earned $10 million on $8.7 billion in transactions from the preceding year (University of Phoenix, 2010). The commercial airline industry has continuously been vulnerable to the economic and political fluctuations, typically in times of an economic calamity for that reason; Classic Airline’s tests as an airliner are not unforeseen. The corporation is a significant contender within the airline business; nevertheless, like countless airlines; Classic faces several challenges because of the increasing customer worries about flying and the current market ups and downs. Classic Airlines recognizes changes that are necessary for the business; conversely, the managing team needs to recognize the present-day marketing difficulties that are troubling the business and determine choices for solving these complications. The paper will benefit Classic Airlines by means of the nine-step problem-solving model in the direction of identifying issues and prospects that will support the airline within the current marketing problems, pinpoint the internal and external pressures contributing to the corporation's crisis. By using the nine step-problems solving model...
Words: 2140 - Pages: 9
...Running head: PROBLEM SOLUTION: CLASSIC AIRLINES Problem Solution: Classic Airlines University of Phoenix January 21, 2008 Problem Solution: Classic Airlines “Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders” (Kerin, 2006). Marketing is a fundamental key to any businesses success and involves determining the needs, wants and desires of consumers and satisfying them to the best ability. Classic Airlines is the world’s fifth largest airline they command 375 jets serving 240 cities with about 2300 flights per day for about a quarter of a century. Classic Airlines has around 32,000 employees. They earned about $10 million on about $8.7 billion in sales. With the uncertainty about flying Classic Airlines and the industry has seen this affect stock prices, Classic Airlines in particular has seen a 10% decrease in their share prices over the past year. Classic Airlines is also dealing with low employee morale, and the consumers’ confidence also seems to be declining as well. (Anonymous, 2007a) According to their financials for the past year, Classic Airlines would have been losing money if it were not for the $15 billion aid package passed by Congress for the airline industry (Kaye, 2002), which is resulting in a $22 million Income Tax Provision...
Words: 4904 - Pages: 20
...Classic Airlines Marketing Solution Classic Airlines is the fifth largest airlines in the world. Classic Airlines has had a history of success and profitability, but as the competitive market changes and a downturn in the travel industry, management has identified changes that need to be made. To ensure the airlines remain competitive and profitable Classic Airlines is faced with the challenge of delivering increased value within leaner budgets. The analysis of the current situation of Classic Airlines is to use proven techniques to address customer loyalty issues and improve the existing Customer Relationship Management (CRM) system. Classic Airlines may uncover numerous opportunities to meet executive demands when implementing the use of the nine-step problem-solving model. Issues and Opportunities: Step One Classic Airlines has become a successful company in Customer Relationship Management. Classic has continued to be profitable; however, recently has been plagued by the uncertainty in the flying industry. Issues have been identified that need addressed, both internally and externally to avoid bankruptcy. External issues include competition, government regulation, and operating costs. Classic Airlines price structure has been uncompetitive compared with other airlines in the industry. Discount Airlines, such as Southwest, and its no-frill business model have enjoyed tremendous success, wooing customers based on price, not perks (Plunkett, J, 2012). Operating costs, such...
Words: 2925 - Pages: 12
...Classic Airlines Marketing Solution Egypt Grandison MKT571 October 10, 2011 This paper will explain and analyzed Classic Airlines, a twenty five-year old passenger airline. Classic Airlines operates more than 375 jets that serve 240 cities and more than 2,000 daily flights; which makes it the fifth largest airline in the world (University of Phoenix, 2011). Therefore, the organization has grown with 32,000 employees, and it earned $10 million on $8.7 billion in sales (University of Phoenix, 2011). Current Situation Classic Airlines is aware of the challenges that come along with a successful organization. With customers unsure about flying because of the rise in prices, it is affecting stock prices. Therefore, causing Classic to have a 10% decrease in share prices last year. Now that the investors are watching Classic more, they have to be aware of the business operations (University of Phoenix, 2011). The reward program had a decrease in numbers and customers are either not flying with Classic, or booking through other airlines. To make matters worse; Classic Airlines has to find a way to make the frequent fliers program appealing to customers, which will bring a hefty return on investment to the company. Stakeholders and Ethical Dilemmas The airline must consider all shareholders and the ethical dilemmas. There are four stakeholders involved in this scenario: Employees, management, shareholders, and of course the customers. Currently the employees have several issues...
Words: 738 - Pages: 3
...Classic Airlines Marketing Solution Creating an effective business strategy includes finding ways to enforce marketing solutions for resolving or evaluating any problems that may arise in the business structure. Successful factors must be considered that are geared towards how the market and consumers response to the strategies of a companies products and services. Classic Airlines continued efforts to ensure that consumer satisfaction remains effective by applying ways to identify its problems and finding effective solutions will help build confidence in the company growth. The following paper will present a 9-step model for problem solving on the main issues of Classic Airlines. Being able to state the problem, redefine the problem, and apply a robust problem-solving process that would present the best alternative solution will help Classic Airlines achieve their sale goals. Challenges for Classic Airlines: Case Scenario The notion that customer satisfaction brings awareness as business has decreased for Classic Airlines set the company at its highest deception for a strait forward marketing goal. Increasing customer relations is the far most challenge, amongst other challenges for the company without lowering cost. Providing a positive marketing strategy that targets the consumers needs strictly identifies the company’s issues. These issues identified have an effect on how Classic Airlines fluctuates within the market, whether technology is being enforced, if the operations...
Words: 2314 - Pages: 10
...Classic Airlines Classic Airlines is one of the world’s largest airline companies that functions with 375 jets and continues to serve 240 cities with 2300 flights a day. Classic Airlines Company grew over the 25 years in business to 32,000 employees and with 10 billion dollars in sales. Even though Classic Airlines has had a positive success, the company also faces the challenges that other airline company’s face in today’s market. Classic Airlines needs to come up with ways to market the company’s product so the customers will want to choose Classic Airlines instead of the other airlines. In addition, Classic Airlines worries about the increase of the global market, competition for the company, the changes in customers spending habits, and the increase of concerns with the airlines security. Classic Airlines needs to take into consideration the amounting stressors and the reduced profits for the company. Classic Airlines has an increase of uncertainty because of the decrease in the stock prices. Classic Airlines stock prices decreased 10% per share. “Classic Airlines experienced a 19% decrease in the members in the affinity program and with a 21% decrease in flights for other members” (University of Phoenix, 2012). Classic Airlines has come across some issues with the rising costs for airline fuel and labor. Financially Classic Airlines is suffering and hampering the company’s abilities to compete with other airlines. To make matters worse Classic Airlines has to increase amount...
Words: 1521 - Pages: 7
...Classic Airlines Marketing Solution Because of the tragic events following 9/11, airline industry’s profits significantly decreased which resulted in an economic downturn. Classic Airlines was not immune to the recession. Classic Airlines Classic’s Rewards Program is currently suffering. Classics Customer Rewards Program has seen a 19% decrease in the number of members and a 21% decrease in flights among its current reward members. Classic Airlines marketing department needs to make an effort to increase customer volume and sales. So what can Classic Airlines do to increase these numbers? Identifying and addressing the internal and external factors contributing to Classic Airlines current crisis will help alleviate pressure associated with this current economic downturn. Employing market data to help develop goals while recognizing and focusing on the challenges and opportunities facing Classic Airlines, will give the airline the ability to take their future to new heights. Classic Airlines is the fifth largest airline and commands a fleet in excess of 375 jets that serve 240 cities with more than 2,300 daily flights. The airline also manages a staff of nearly 32,000 employees. Classic has managed to remain profitable over the past year. The airline earned $10 million on $8.7 billion in sales; however with rising overhead costs Classic Airlines is experiencing setbacks. The airlines share prices have decreased by 10% in the past year. Furthermore, with the negative publicity...
Words: 7997 - Pages: 32
...Classic Airlines Marketing Concepts Marketing MKT/571 Classic Airlines, an airline organization who faces competition is seen in its reduction of customers’ confidence resulting in lower sales. “Classic Airlines saw a decrease in their share prices and a decrease in the number of customers enrolled in their Classic Rewards Program” (University of Phoenix, 2012). The reward program is recording reduction in the number of members and the increase of fuel and labor costs is pushing the organization to the possibility of going bankrupt. Classic Airlines has had declining profits and their stock prices have fallen which has affected the organization. This has forced the company to restructure based on extreme competition and the declining metrics disclosed from their customer loyalty report. The paper is meant to identify the products or services and its challenges plus discussing the marketing concepts that the organization uses to guide its marketing efforts. Current Situation Classic Airlines is a company with an extensive history of success however, the company has encountered difficulties in their advancement toward an effective customer service and marketing campaign. Over the years the cost of fuel and labor has been increasing and the top executives at Classic Airlines have a hard time figuring out how to cut costs, so that they can afford increases. There is a need for the airline to keep up with providing the best services...
Words: 3284 - Pages: 14
