Classic Airline Case Analysis Name of Course Your Name Your University Introduction This report is a critical analysis of the marketing department of Classic Airlines. The report will critique the main marketing problems and issues with the airline through the Root Cause Analysis model…
As per the case study, the firm is losing its profitability and faring really poorly against its competitors. Customer retention rate is poor and the service is very inadequate. Root Cause Analysis Model The Root Cause Analysis (RCA) model is used in internal audits and other problem detection fields. It is “a research-based approach to identify the bottom-line reason of a problem with root cause representing the problem” (Mainardi, 2011: p180). It involves a structured investigation into a given problem to ascertain the true and real cause of a given problem (Anderson et al, 2009). This is done to ensure the continuous improvement in the quality and systems of a given organization. Root Cause Analysis is a practical transition from the apparent cause analysis to the examination and critique of the root cause of a given problem. This involves the identification of the actual causes in order to find the intermediate causes and from there, detect the root causes (Lorenzo and Hanson, 2008). Issues in Classic Airline's Marketing Unit From the case study, some apparent causes and issues are identifiable in Classic Airline's marketing unit. In order to identify it and critique it better, it will be worthwhile to identify the apparent issues, the intermediate issues in order to identify the root cause. A. ...
The deregulation of the markets and the integration of small carriers and other overseas investors has led to price wars and other competitive restructuring. Classic Airline's extremely low margins give a strong indication that the airline is really losing out in the competition presented by the other airline companies in the industry. Market Share Issues The failure to compete on the markets have led to a sharp fall in the market share that Classic Airline controls. There customer retention of the company has been weakened by the competition posed by other companies. This is because their current reward program has lost as much as 19% of its members, which has culminated in the reducing the flights of the company by as much as 21%. B. Intermediate Issues Areas of Interest: Marketing Alliances & Restructuring of Marketing It has become almost apparent that the firm needs to restructure its marketing units, the marketing structures and the marketing alliance programs. This is meant to correct the wrongs in the company and also retain some degree of stability. This has created two issues which also needs to be examined and resolved from the root-cause approach. Cost Structure Issues The quick and aggressive growth of the firm has been identified as a major cause of issues with the company. The reduction of the cost budget by a whopping 21.5% and the reduction of budgets in other departments is one of the apparent issues. It will therefore be worthwhile to identify the impact of this reduction and the best way of soothing its effects and correcting its issues. This include amongst other things, infighting amongst the executive managers, and the reduction in important units ...
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This shift in paradigm has been the result of an increase in the level of inflation and a rise in the cost of fuel. These two variables have made it imperative for airline carriers to achieve operational excellence and enhance customer loyalty. Unfortunately for the company, it has encountered some internal problems which are preventing it from addressing these challenges effectively.
Classic Airlines is facing problems as the firm has not been effective at retaining customers. In the last year the firm has lost 20% of the member of its customer loyalty program. The firm has lost approximately 160,000 recurrent clients.
Classic Airlines is a company in the airline industry with over 25 years of experience. The firm has an operation that includes 2300 daily flights across 240 cities. The firm has a global workforce of 30,000 employees. Due to the size of the company it is imperative for this firm to invest its marketing dollars well.
One of the fifth largest airlines, Classic Airlines is experiencing challenges due to larger service costs and fuel costs and issues related to service and marketing. Due to this there has been a steep decline in the consumer traffic.
The paper starts by identifying as well as defining the problem and this is followed by application of the above mentioned problem solving model. The internal as well as external pressures contributing to Classic Airline’s current crisis will be discussed in detail and the essay will also seek to establish the marketing resources that are available to resolve the crisis.
Last year it earned a profit of $10 million on sales of $8.7 billion. However, Classic Airlines has been facing some similar problems as the rest of the industry, such as rising fuel costs, while its customer retention and loyalty programs have been failing resulting in falling sales and bookings.
The current paper focuses on the marketing needs of a well – known organization, in the context of the airline industry, Classic Airlines. It should be noted that the above firm has, traditionally, focused on the limitation of its costs, so that its potentials for high profitability are increased.
However, the approach is similar as finding a solution is applicable in both. Ideally, it will not be wise to close down a business because of the problems encountered. In order to solve a problem, it is crucial to apply the relevant problem solving skills in order to overturn the outcomes (Blais, 2012).
improved management system that laid emphasis on meeting customer expectations and at the same time eliminating wasted expenditures and operating costs and put the saved resources to a more effective use.
This case is very much similar to that of Classic Airlines, wherein the
Hence, it is believed that classic airlines is not reaching its targeted market effectively.
In order to devise a proper strategy for treating the above problems an internal and external analysis of the firm must be carried out which would help the organization
5 Pages(1250 words)Essay
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