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Alaska Airlines

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by

Jaime Oleksik

on 13 March 2013

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Transcript of Alaska Airlines

Anthony Johnson
Caitlin Keller
Jaime Oleksik
Susan O'Shauhnessy
Lissell Paredes Alaska Airlines Market Analysis Marketing Strategy Overview of Problems Pursuing technological efficiency while still fostering customer-employee relationships. How much further should Alaska Airlines advance technologically?

Challenges to their website

Solidifying their market segment

Manually Operated Flight Monitors

Restraints of the FAA How much further should they advance technologically? Airport of the Future Team
Need to sustain the competitive advantage without complicating their business design
What should be their primary focus? Challenges of the website Cannot retain customer data
Integration Issues with SABRE
Cannot redeem frequent flyer miles
Goal of moving to 50% of online business Solidifying their target market Changed over the years due to the economy Manually Operated Flight Monitors Restraints of FAA Not providing the most accurate or timely information Navigational Performance Technology limited to Alaska only Overview of Solutions Enhance website capabilities and user friendliness

Effectively utilize customer data

Invest in newer technology to automate Airport Flight Monitors

Work cohesively with other major airlines

Airport of the Future team Enhance website capabilities and user friendliness Create customer profiles
Redeem miles on-line
24-hour live chat Feature Effectively Utilize Customer Data Track satisfaction levels
Determine their premier market segment
Develop a loyalty program targeted to premier segment Automate Flight Monitors Timely flight information for customers
Real-time data Work Cohesively With Other Major Airlines Help get further approval from FAA
License technologies Airport of the Future Team Utilize effectively Objectives Revamp Mileage Program

Utilize 'Airport of the Future Team'

Customer Service Feedback

Improve Website Online Profile

Extensive Employee Training Utilize 'Airport of the Future' Team Revamp Mileage Program Customer Service Feedback Improve Website Historical Summary Market Overview Industry Trends Competitor Analysis Southwest Airlines Created in 1966.
Has become the 5th largest carrier in the U.S.
Only airline to record profits throughout the decade.
Has a fleet of 280 planes.
Serves 55 cities in 29 states. Value Only low-fare, short-haul, high-frequency, point-to-point carrier in America
Triple Crown winner
Frequent Flier rewards different from the rest
Keeps costs down through fuel hedging Weaknesses No strategic alliances with other carriers American Airlines Formed in 1934
Evolved from mail carrier to commercial
Largest U.S. carrier and second in the world
International Service - over 130+ countries
First to introduce electronic booking Value Oneworld alliance with British Airways, Qantas, and Canadian Airlines.
Strong presence on large East Coast cities, especially NYC.
Ranked 1st in on-time dependability
Large, modern fleet of approximately 400. Weaknesses High costs
Weak presence in West Coast
Higher fares Company Analysis Competitor Analysis SWOT Analysis Contingency Plan Disaster Recovery Plan
Tier 1
Tier 2
Tier 3 Efficiently Back Up Data Strengths:
Customer Service
Lead Edge Technology
Size
Exclusive Market Opportunities:
New Technology
New Sources of Revenue
Expand to New Markets Threats:
Low Cost Airlines
Similar Innovations
Telecom Industry Weaknesses:
Business Model
Technology Founded in 1932; reputation of customer service.
19 consecutive years of profits
accumulated 2 years of losses due to entry of low cost providers in the market.
adjust cost structure and quickly return to profitability.
technologically driven and not afraid to innovateto find new ways to serve passengers. Historical Summary 1950s Introduction of commercial jets 1970s Introduction of "jumbo jets" 1978 Air Deregulation Act 1980s Industry Expansion 1990s 4 consecutive yrs of net losses totaling over $22B Market Overview 2 Demand Components Industry Trends Elastic Demand: Pleasure Travelers travel more when price is lower Inelastic Demand: Business Travelers fly regardless of price Impact of Deregulation Market Instability due to
M&A activity Increased Competition: Price Focus on operating profitability & cost efficiency New market entrants Market Statistics 1950s-60s annual industry growth of 15% 1980s-90s annual industry growth of 5% 1990-93 $22B losses industry wide 1995-99 $25B industry wide profits 2000-05 $40B losses industry wide Cost Cutting & Subsidization Frequent Flier Programs industry symbol of peanuts revamping routes 18% industry-wide decrease in marketing expense renegotiating cost of labor Congress noted them as a barrier to competition/ market entry Alaska's program difficult to use; yielded a small cost to Alaska but kept consumers flying Alaska Incentives for returning customers
Simplify the Mileage process
Accessible personal mileage information available online Aggressively investigate new technological ventures
Management support for 2-3 large projects annually Current competitive advantage
Online survey
Customer lunch forum Implement website team
Simple online check-in
Interactive customer profile
Full transcript