Classic Airlines Marketing Solution Essay

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Classic Airlines Marketing Solution The company of Classic Airlines (Classic) has been part of the airline industry for 25 years. Classic employs 32,000, operates over 375 jets, and has a net profit of $10 million from $8.7 billion of sales (University of Phoenix, 2012). Although profitable, the organization cannot always avoid the problems and struggles that the airline industry companies face from time to time. In the last few years, uncertainty and fear about flying among consumers has created problems for the organization. One major problem is that Classic’s share prices dropped 10% in the last year. This drop in share price has made investors skeptical and they have begun to scrutinize operations. This skepticism and scrutiny is causing negative thoughts from Wall Street, the media, and the public. Employee morale levels have also lowered for Classic Airlines. Like most competitors, Classic Airlines offers a customer rewards program known as Classic Rewards. The second major problem for Classic is that the program has experienced a 19% drop in members and a 21% drop in number of flights booked using a rewards number (University of Phoenix, 2012). Customers were either not using their rewards number or they were flying with competitors. Either way something needs to be done. One of Classic’s main goals as an organization is to have a valued frequent flyer program and loyal customers. Increases in fuel and labor costs are believed to be the cause of the drops in membership and flights booked. To make matters worse, the Board of Directors “recently mandated a 15 percent across-the-board cost reduction over the next 18 months” (University of Phoenix, 2012). Classic is now faced with the task of finding a way to make the Classic Rewards program more successful while providing the company with a reasonable return on investment. Kevin Boyle, Chief

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