Classic Airlines Marketing Solution Essay

2169 WordsMar 3, 20129 Pages
Classic Airlines Marketing Solution It costs an organization more money to acquire a new customer than it does to keep or retain an old one (Kotler & Keller, 2006) . Classic Airlines, the world’s fifth largest airline, has been in business for 25 years and has 32,000 employees. Their fleet is 375 jets and serves 240 cities. It operates more than 2,300 flights per day (UOPX, 2005). With a decline in sales and a shrinking market share, membership in the rewards program, thus profitability, has been affected in an adverse way. Based on these issues and the latest customer loyalty information, chief financial officer Amanda Miller has given the leadership team the task of making vast improvements to the rewards program. By promoting a return on investment (ROI) while meeting cost reduction goals and giving stakeholders what they desire, the objective outcome for Classic Airlines is within grasp. In addition to the above problems, the board of directors recently mandated an across-the-board cost reduction over the next 18 months. The goal for Classic Airlines is to build consumer and employee confidence while keeping costs low. To do this, customer feedback gets thoroughly analyzed so the company can understand forecasting and marketing objectives going forward (UOPX, 2005). Classic Airlines has faced many obstacles, three being the rapid increase in employees, the 19% decrease in rewards members, and the 20% reduction in flights. They need a significant change in very little of time (UOPX, 2005). Another hurdle they are facing is the mandatory cost reduction of 15% handed down by the board of directors for the next 18 months. Combined, these issues have caused a 10% decrease in the stock price. Another factor that has contributed to the current crisis is the replacement of Jack Broadway (former CEO) with Amanda Miller (current CEO). Amanda’s philosophy
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