Southwest airlines 4 p reportPresentation Transcript
Marketing Management July, 2011
About the company
Products and Services
About The Company
Gary Kelly is Chairman of the Board, President & CEO
A publicly traded company (NYSE: LUV)
Headquartered in Dallas, Texas
35,000+ Employees, 82% unionized
The United States’ most successful
- Low-fare, high frequency
- point-to-point carrier
- No Frills airline (no meals, no in-flight movies)
History In 1971 by Rollin King and Herb Kelleher founded the company with one simple notion “ "If you get your passengers to their destinations when they want to get there, on time, at the lowest possible fares, and make darn sure they have a good time doing it, people will fly your airline." Southwest Airlines commenced Customer Service on June 18, 1971, with three Boeing 737 aircraft serving three Texas cities-Houston, Dallas, and San Antonio and in 1979 flew to all the major cities in Texas. In 1989 - Exceeded the billion-dollar revenue mark and became major airline http://www.southwest.com/html/about-southwest/index.html?int=GFOOTER-ABOUT-ABOUT http://www.blogsouthwest.com/blog/flashback-fridays-southwest-airlines-early-san-antonio-days
Largest U.S. carrier based on domestic passengers carried in 2010.
Fly more than 88 million passengers in 2010
1 st major airline to offer “ticketless” travel
1 st major airline to have its own web page 1 st airline to offer online booking.
1 st airline to offer satellite-enabled WiFi
As of Sept 2010, Southwest.com is largest airline site in terms of unique visitors
As of June 2011, Southwest operates 552 Boeing 737 aircraft among 72 cities in 37 states
Customer Service http://blog.marketingmetricshandbook.com/2010/02/customer-satisfaction-and-retention/ http://www.southwest.com/html/customer-service/index.html?int=GFOOTER-CUSTOMER-CUSTOMER-SERVICE “ We like to think of ourselves as a Customer Service company that happens to fly airplanes”
Customer Service In 2010, Southwest Airlines led the U.S. Department of Transportation Customer Satisfaction ranking. Only 27 customer complaints per 100,000 customer boarded http://www.southwestonereport.com/people_cu.php
Products and Services
Fly to 72 cities in 37 states
Fly 3400 flights per day
Fly more than 88 million passenger in 2010
Major airline that provides;
-Point to point service
Map - Destinations
*Service to Newark, NJ began March 27, 2011. *Service to Greenville-Spartanburg, SC and Charleston, SC began March 13, 2011.
Products & Services http://www.southwest.com/html/air/corporate-travel.html Allows members to get direct access to the front of ticket counter and security lanes No fee on changing the flight Low cost option allows customers to obtain better boarding position Get priority lane access and priority boarding Allows to check in one stroller, one car seat free of charge, in addition to two free checked bags. At minimum charge provides satellite based internet service
Products & Services A forum where you share your stories and travel advice, rate hotel, restaurants and more.. Application for desktop and iPhone, delivers exclusive, limited-time-only airfare deals on select flights Small pets are allowed in flight cabin at $ 75.00 fee Weekly email that provides information on all deals including air, hotel, car rental App for Blackberry and iPhone allows to access same feature as southwest.com Provide customizable leisure vacation packages
Services for business travelers http://www.southwest.com/html/travel-extras/business-select.html
Extra Rapid Rewards Points
Fly By Priority Lane Access
Online tool that allows business travelers to plan, book, and purchase a Travel on Southwest Airlines
Acquisition of AirTran Airways, which closed May 2, 2011 for about 3.2 billions
After complete integration mid-2012, Southwest will expand service to 38 additional destinations
Will offer direct international service to Mexico and Caribbean and a lso Atlanta, largest US city not served by Southwest prior to the acquisition
Southwest Airlines will add AirTran Airways's 88 Boeing 717 aircraft to their fleet totaling 640 fleet
This term was coined to describe the boost in air travel by DOT in 1993.
The Southwest Effect - When Southwest starts flying into the new city;
-Air fare drops
-Increase in air travel
-It’s Business Model is major inspiration to other low cost carriers
Brand Loyalty - Low-priced fair - “Southwest Spirit” of Employees - Employees committed to “doing the right thing” - Customer-friendly policies on handling complaints "Our people are our single greatest strength and most enduring long term competitive advantage." Gary Kelly, CEO Southwest Airlines http://www.southwest.com/html/about-southwest/index.html
Flies only one type of fleet Boeing 737 so saves money
20-minute turnaround time so high aircraft utilization
No seat assignments
No meals – no frills, snacks only
No electronic entertainment
Small airports, back gates
No seat assignments
No baggage transfers to other airline
No connection with other airlines
Paperless tickets (e tickets)
Single-class of service so more seats are used
Business Travelers (Point – to – Point)
Dissatisfied customers from full-service airlines
People who travel by Road, Rail
Cost and value conscious consumers
Small business executives
Travel short distances
Prefer low cost fares
Direct marketing –
- Via Internet – 84% of tickets in 2010 sold thru Southwest.com
- No travel agents
- Do not use any other reservation system websites
- Does not offer joint fares with other airlines
Online booking tool for business travelers
- SWABIZ.com – allows business travelers to plan, purchase, and track business travel thru their companies web page.
Social Media and Internet Marketing http://swamedia.com/
Promotions Rapid Reward program to earn free air ticket Discount on air fare for 10 or more people traveling together Provide customizable leisure vacation packages
Online Advertisement DING - Application for Desktop, iPhone and Blackberry that notifies the customer of hot limited-time-only airfare deals on flights Click N Save - Weekly email to Inbox that provides travel deals on Southwest flights, car rentals, hotel offers, cruises and Southwest Vacations
“ Just Plane Smart”
“ THE Low Fare Airline”
“ Symbol of Freedom”
“ Wanna get away?”
"The Somebody Else Up There Who Loves You"
"Grab your bag, It's On!“
“ fees don’t fly with us”
Sponsorships http://www.southwest.com/html/southwest-difference/community-involvement/sponsorships.html "Official Airline" Sports Team Sponsorships
Southwest Airlines to Increase Service To Mexico With Volaris Partnership
http://swamedia.com/releases/05fbe1c7-4826-25f5-1b8c-19004dc2ea77 http://swamedia.com/releases/d040b542-390e-0611-e12c-5c004dcbfcfb http://www.mediapost.com/publications/?fa=Articles.showArticle&art_aid=152637 Southwest Airlines is teaming with the Student Conservation Association (SCA) for the Conservation In Action Tour Partner with Sea World in their 40th Anniversary celebration. This sweepstakes gives 40 families the chance to enjoy a VIP experience
Charitable Giving's & Volunteerism
SWA serve the community through a program titled “Share the Spirit”.
In 2010 Southwest Airlines received 16,678 donation requests and distributed more than 29,664 tickets and $1,266,950 in cash in response, for a combined value of more than $11.6 million in total contributions
Relationships with nonprofit organizations on both a local and national level. Support by committing resources of time, tickets and monetary donations.
Support “The Ronald McDonald House program” by sponsoring golf tournament
Support families Facing Serious Illnesses thru Medical Transportation Grant Program
1984 - #1 in customer satisfaction (4 th year in a row)
May 1988 - First airline to win the Triple Crown award
2009 - Ranked # 2 in Top 20 Best Companies for Leadership list (Business Week)
April 2010, Ranked as the top-rated brand among the nation's small-and midsized-business owners and top executives, for a second year in a row
In November 2010, ranked # 1 in the Zagat Airline Survey, in the following categories: Top Website; Best Customer On-Time Estimate, Best Luggage Policy, Best Value, and Best Checkin Experience for Domestic Airlines.
In December 2010, Southwest Airlines was named “Best Low Cost Airline in North America” by Business Traveler Magazine.
In 2010 - Rank second in customer satisfaction survey conducted by J.D. Power
In March 2011, Ranked fourth in World's Most Admired Company list ( Fortune magazine)
Part of our environmental policy is striving to meet our annual goal of zero recorded environmental violations in our operations.
Fuel savings and reduction in greenhouse gas (GHG) emissions – thru use of efficient planes with winglets
In the air, to reduce emission, initiated programs such as efficient flight profile speeds, aircraft specific performance monitoring,
“ Green Planes” – made with environmental friendly material , light weight to save fuel and reduce GHG emission, use of recyclable materials
Comprehensive engine wash program, along with gate services and an industry-leading Ground Support Equipment (GSE) electrification program.
Recycling and Waste Reduction – aim to increase the quantity of materials recycled on board by 10 percent over our 2010 levels
For Southwest, Safety of Customers and Employees is number one priority.
Southwest supports the culture that identifies risks to the operation and workplace
Southwest proactively deals with these issues before they become injuries or accidents
To accomplish this goal the following Company policies are established:
All employees are responsible to comply with all governmental safety regulations and guidelines
Employees are responsible to follow Company policies and procedures
Encourages proactive reporting Culture, no disciplinary action against any Employee for reporting a Safety occurrence
In its 40th year of service, Southwest Airlines continues to differentiate itself from other low-fare carriers by offering a reliable product with exemplary Customer Service.
Since its initiation, Southwest has managed to grow in a controlled fashion by adding only a few new cities each year.
Southwest has proven itself to be successful and analysts believe that it will continue to be profitable as long as it never ceases to offer customers efficient and low cost air transportation, with continuous aggressive promotion and strong commitment
Southwest will remain the preferred airline for providing low fares.
After Mexico, future target market would be Canada or Hawaii
Resource Citation http://www.southwest.com http://www.southwestvacations.com/generalInformation/aboutUs.aspx http://swamedia.com http://en.wikipedia.org/wiki/Southwest_Airlines http://www.hoovers.com/company/Southwest_Airlines_Co/rrykki-1-1njdap.html http://mobile.southwest.com/ Book – Southwest Airlines by Chris Lauer