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 credit for the company. Based upon this and the latest Customer Loyalty Report, Chief Executive Officer, Amanda Miller, has tasked members of the leadership team with improving their frequent flier program with methods that will demonstrate a measurable return on any investment while still meeting the cost reduction goal and without discounting fares. In addition, the Board of Directors
