Southwest Airlines Case Study Essays

Southwest Airlines Case Study Essays

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Southwest Airlines Case Study

Marketing. Marketing savvy also plays a key role in Southwest's strategy. Since Southwest's inception, the major elements of the product offering have been price, convenience and service. As a Texas native serving mostly Texas markets, it has played the role of the hometown underdog, fighting against the majors. Now, when Southwest enters a new market, they use a sophisticated combination of advertising, public relations, and promotions in the belief that once people fly Southwest they will be hooked.
Growth. Despite its remarkable growth in what had been until recently a relatively moribund industry, Southwest has not emphasized growth as an objective. In fact, Herb Kelleher expresses a "go-slow" philosophy. For example, Southwest will not enter markets unless it perceives favorable conditions, which range from the wishes of the local community to the availability of an appropriate labor supply. Given its record of success and its reputation it is not surprising that there are many communities that want Southwest to serve their markets. After all, good air service is considered by most communities to be an essential aspect of economic development. However, Southwest's policy prohibits accepting monetary subsidies or other incentives that cities and airports offer to gain air service. Southwest has also demonstrated a remarkable ability to manage its growth, an essential commodity in an industry known for its complexity. The inability to manage rapid growth has been blamed for the failure of many carriers, including Braniff, PeopleExpress and ValuJet
Technology. Like all airlines, Southwest is a very heavy user of computer-related technology. This technology supports all activities ...

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...ronment is changing, people are traveling again and with improving opportunities, it is looking for and jumping on opportunities as other airlines struggle to be simply profitable as fuel costs rise and fares shrink. Kelly also faces significant threats: low-cost carriers JetBlue and AirTran Airlines are also looking to expand in the same markets. To do so, he is asking for more productivity from already efficient employees and asking pilots to fly as many as 70 hours a week for less money than they could make at other carriers. KellyƳ strategy to link up with ATA stunned the market and the industry
Moving into 2005, Southwest was facing many familiar challenges: rising oil prices, intense competition, cumbersome regulations. In the uncertain times that had legacy (traditional) carriers reeling, Southwest was still winging ahead with its ever-popular low-fare formula

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