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Delta Final basic economy
- 1. Basic Economy Class JoshDoiron Veronica Garcia Nicole Kuester Silvia Linares Joanna Zaki
- 2. Delta Airlines Overview -Little aerial crop dusting operation called Huff Daland Dusters in 1924 - First established in Atlanta, Georgia in 1967 - 334 Destinations; over 60 countries - Grew into world’s largest global airlines - More than 180 million travelers each year - Reputation for excellent service - Ranked one of the top Airlines by Forbes-2013 - SkyTeam global alliance
- 3. Basic Economy - Wi-fi -Free video entertainment - Complimentary snacks & non-alc. - Service - Assigned seating after check-in - No changes or refunds (after 24 hr cancellation period) - No paid upgrades
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- 5. Environment Political- Must adhereto FAA rules Economic- Changing generations and fuel prices Social and cultural- 9/11 and other events Technology- New technology and expectations
- 6. SWOT Strengths â—Ź Strong marketposition â—Ź Diversified geographical presence & wide global presence â—Ź Modern aircrafts â—Ź Great Reputation Weaknesses â—Ź High labor expenses â—Ź Capital expenses & worldwide operating expenses â—Ź High debt Competitive Market: â—Ź Low switching costs â—Ź Very competitive industry â—Ź Frequent Flyer Program
- 7. SWOT Opportunities â—Ź Fuel Efficiency â—ŹImproving Technology â—Ź Global Industry â—Ź Benefits such as complimentary upgrades or preferential customer service â—Ź Improve Skymiles Rewards Threats â—Ź Increases in Fuel Costs â—Ź Terrorism â—Ź Government Regulations â—Ź Weather â—Ź Bad press â—Ź Low rated points and miles (basing miles earned on ticket price rather than distance)
- 8. Analysis of Competitors Variouscompetitors in air travel industry Direct: American Airlines Indirect: Southwest Airlines Final analysis of Spirit Airlines, & other discount airlines: No competition
- 9. Direct Competition: AmericanAirlines American Airlines’ = “No benefit” service -Rolling out in the second half of 2016 -Targeting “price sensitive” customers -Competing with Spirit and Frontier -Threat to Delta if prices are comparable to discount airlines
- 10. Indirect Competition: SouthwestAirlines No similar service to Basic Economy However, very similar in price (sometimes even lower) Target middle class, price sensitive flyers
- 11. Market Segmentation Criteria â—ŹTravel Purpose â—Ź Travel Frequency â—Ź Price Sensitivity â—Ź Age â—Ź Use of Loyalty Programs â—Ź Urgency of flight need
- 12. Market Segments â—Ź FrequentLeisure Travelers â—Ź Loyalty Customers â—Ź Urgent Travelers â—Ź Budget Conscious â—Ź Business Travelers
- 13. Market Segmentation Demographic â—Ź Employed â—ŹWorking to middle class people (64% of the US) â—Ź Trade skill and/or some higher education Psychographic â—Ź Price sensitive but seek quality â—Ź Last minute planners / impulse decision makers â—Ź Relaxed with vacation pursuits â—Ź Hectic and in need of a value and reliability Life Stages â—Ź Early adults (20-35), midlife (35-50), mature adults (50-80) Geography â—Ź Select Delta hubs - Atlanta, Detroit, Minneapolis and Salt Lake City Behavioristic variables â—Ź Search for value, comfort, entertainment and reliability â—Ź Loyal customers who tend to fly shorter domestic trips.
- 14. Product Positioning â—Ź Onefree bag â—Ź Non-alcoholic drinks and snacks â—Ź In-flight entertainment â—Ź loyalty program â—Ź Trusted brand â—Ź On time flights â—Ź Parties of one or two / small groups â—Ź Short distances of six hours or less â—Ź Not interested in upgrades â—Ź Confident purchase Value, Reliability, Comfort and Amenities - Integrated Strategy
- 15. Positioning Statement For leisureand business travelers, Delta Airlines’ Basic Economy strives to be the most valuable option that offers comfortable transportation at an affordable price, because of its excellent customer service and high quality aircraft.
- 16. Marketing Objectives Increasing MarketShare - By offering lower fares in order to compete with low cost airlines such as American Airlines & Southwest. Use promotional tools to build awareness of the: - Overall value of Basic Economy - Reliability & Reputation of Delta Airlines - Comfort & Amenities that come with it
- 17. Product/Pricing Strategy â—Ź Skymiles& Medallion Loyalty Members â—‹ Can now choose seats after check-in â—Ź No changes to price â—‹ Price remains competitive in market â—‹ Price comparison with American Airlines
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- 21. Marketing Strategy Print Media -Travel Agent Magazine - AARP - The National Geographic - Time Inc. - USA Today - WJS - NY Times Message: “The most valuable way to fly in the world’s most trusted airline” Digital - FB, Twitter, Instagram, Snapchat - Website/Mobile App - TV - Radio - Outdoor/Mall Posters Delta Basic Economy
- 22. Marketing Strategy Public Relations -Survey public on attitude & awareness (before and after trial) - Send press release of market expansion in summer - Work with press (positive WOM) - Monitor social media content - Clippings, keyword search to monitor any mentions
- 24. Control Advertising 1. Print Media→ Unique URL 2. Social media → Impressions, likes, shares, and mentions (engagement) 3. Website → Google Analytics for website traffic 4. 3rd party websites → Redirect to Delta website, track using Google Analytics 5. Television → “Visit www.delta.com/BasicEconomy to learn more about how you can fly for less” 6. Radio → Similar to TV, provide specific URL 7. Outdoor → Unique URL, geographic data using IP address
- 25. Control Public Relations →Google Adwords Keyword Tracking and mentions Personal Selling → Customer service scores Travel Agents → Awareness surveys, educate about service
- 26. Recommendation Basic Economy hasproven successful in its first quarter on the market. We recommend that Delta continue to offer it, while implementing our marketing strategies to increase sales and create more lifelong Delta customers.
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