southwest airlines presentation

Southwest Airlines Marketing Proposal Group 7 Andrew Daley Lydia Thankambaby Megan Mugavero Henna Kim Nick Fu

Table of Contents 1 2 3-4 5 6 7-15 16-20 21 22

Cover Page Table of Contents Company Brief Marketing Problem SWOT Analysis STP Analysis Marketing Mix Conclusion End Page

Company Brief ● ●

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Southwest Airlines was founded in Dallas, TX in 1967. It began based out of Love Airfield, and had an early history of being a low cost airline in the Southwest region. Flights out of Love airport were originally limited by the Wright Amendment, a federal law that limited non-stop flights out of Love Airport to Texas and the surrounding area. This was repealed in 2006. Since the Repeal of the Wright Amendment, Southwest Airlines has expanded non-stop flights to airports nationwide, and as of 2011 carries more domestic passengers than any other US airline.

Love Campaign ●

Southwest recently completely rebranded the company in what they call the “Love Campaign”. This repositioned them as a competitively priced airline with a focus on their enthusiastic service, triple bottom line, and perks such as no baggage fees and no assigned seating.

Marketing Problem ●

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Southwest recently acquired new terminals in New York and Washington D.C., and they need to begin building a brand in those cities Southwest has also begun a transformation from the cheap alternative, to a competitively priced option that differentiates itself through its superior service and personable brand

SWOT Analysis

S.T.P Analysis

Geographic Segmentation ● New Markets ○ Recently acquired terminals ○ New York-LaGuardia ○ Washington DC-Reagan

● Existing Markets ○ DFW, Houston, etc.

Targeting & Positioning

Demographic Segmentation ●

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Families ○ Require more friendly and flexible service Single Travelers ○ On-time oriented High income vs low income ○ High income less price sensitive ○ Low income most price sensitive

Targeting & Positioning

Psychographic Segmentation ●

“Heart” Lifestyle ○ Enthusiastic people who are looking for a different, more personable flight experience ○ People who are environmentally conscious ○ People who appreciate charity and philanthropy ○ May alienate more business oriented individuals

Targeting and Positioning

Behavioral Segmentation ●

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Cost/Value oriented consumers ○ Most price sensitive ○ More sensitive to promotions Service oriented consumers ○ Less price sensitive ○ Brand loyal ○ Sensitive to perks

Targeting and Positioning

Marketing Mix

Price ● Keep prices low, but increase them if necessary to maintain quality service. ○ ○ ○

“Cheap” market is overtaken by new low cost airlines Southwest no longer just the “cheap” airline company Compete by keeping competitive prices while providing better services

Product ● Maintain high standards as an airline ○ Never institute baggage fees ■ 2 bags free per passenger ○ Keep employee benefits ■ Employees and families fly free/discounted ○ Continue to hire enthusiastic employees ■ Happy workers tend to make for happier customers

Promotion ● Direct promotions ○ local flyers and free promotional points

● Keep current frequent flyer system ○ Points earned determined by flight cost ○ Reward system

● Conventional advertisements ○ Billboards, commercials,etc.

● Increase online presence

Place ● Utilize online ticket distributor services ○ ○ ○ ○

Travelocity Orbitz Expedia Priceline

Conclusion ● Southwest airlines already has the best service and value in the industry, they simply lack the brand recognition of larger firms ● Aggressively promote “Heart” brand in new markets, and offer promotions to begin building a strong customer base ● Maintain quality service in old markets while informing the market of their new non-stop destinations and competitively advertising perks that competitors lack (i. e. baggage fees)

Thank you!