Case study: Classic Airlines
The current global competition among businesses has attracted an environment where companies or organizations must device all the possible ways in order to make the most of profits and also ensure growth by concentrating on the strategic marketing methods. A good example is Classic Airlines. The company has a chance to change the general angle of the airlines business. As a way of guarantying its success in the airline business, the company must be in a position to suitably predict the market capacity as well as impending demand, though the creation of long-term marketing goals.
Classic Airlines has been facing managerial issues. Both the external and internal marketing departments at the company have not been able to fulfill the needs of the shareholders. Regrettably, potential clients have seeking alternative ways such as, the services provided by other airlines as they are guaranteed that their needs will be met. To a greater extent, this has led or resulted in meagre sales and continued reduction of profits for the airline company. An important fact to note here is that, to a greater extent, the marketing strategy of a company assists the company to bond with its clients at all times (Kerin et al., 2006, p.10). Therefore, Classic Airlines have no choice but to develop a functioning strategy of action that will aid, attract and keep their clients as well as increase their overall sales and profits.
Concern and opportunity divination
Classic Airlines has operated as an airline business for the last 25 years. The company operates a fleet of approximately 375 jets that offer services to around 240 cities with more than 2000 trips every day (Tokhi, 2009, p.16). The company has been facing many challenges due to rising prices, lack of innovation and lack of creativity. Many clients are not pleased with the services they receive while the management on the other hand have not been able to come to a conclusion on how to work on or correct the issues. The company at this point has no option but to work on how to motivate their managers who act as crucial pillars of the company.
The company has been experiencing a reduction in stock costs a challenge largely related to employee motivation perspective which is very low due to acts of blaming each other and the consequent lack of unity. A different case study conducted revealed that devoted clients were leaving the company while the ones aboard were flying less often (Case Study, 2008, p.3). A critical look at the company and one will realize that both the employees and the customers are not motivated to have a sense of ownership of Classic Airlines. Additionally, the employees and mostly the customers have no voice which contributes to the managerial issue (Case Study, 2008). A case study conducted in 2008 reveals that both the CEO and CFO paid more attention on numbers and paid less focus on marketing and the motivation aspect (Case Study, 2008, p.3).
By the year 2009, membership at Classic Airlines rewards was down by virtually 20% while the normal total of flights for each member was down by more than 15% (Tokhi, 2009, p.17). Additionally, the company in the recent past authorized a 15% price drop for a period of 18 months which was a rather main challenge for all the departments in the company. Any alterations in the marketing setting or environment is actually a basis of prospects and threats that need to be managed (Tokhi, 2009, p.17). The procedure of repeatedly obtaining information on events happening outside the company in order to categorize and deduce possible trends is known as environmental scanning (Kerin et al., 2006, p.10). In this case, conducting an environmental scanning will aid the company to achieve growth.
The company is in fact walking on a very tight rope since the employees are unhappy, and secondly, they are not united, the customers on the other hand are unhappy while competition is on the rise (Case Study, 2008, p.4). Strategic decision making and improved performance must be achieved in order to help the company get back on the right track. As a way of solving the challenges it is facing, special emphasis should be aimed on innovation, creativity, client service, and productivity. Since the company is anticipating on improving the quality of services they provide, marketing will obviously play a critical role in the success of the company.
Classic Airlines must utilize all the possible ways as way of maximizing development and profitability. Competition generally keeps costs lower. Therefore, the company must be in a position to predict market prospective and demand, by forming long-standing marketing goals that efficiently address the challenges (Tokhi, 2009, p.17). The particular case study supports the fact that employee motivation in the company is particularly low owing to the acts of blaming each other and also due to lack of unity. Therefore, Classic Airlines must actualize its inner marketing approaches or strategies to support their employees.
In a nutshell, internal marketing is normally founded on the understanding that a company dealing with services must concentrate on its employees, or its inner market, before concentrating on any positive programs related with the customers or clients (Tokhi, 2009, p.17). Therefore, a services company such as Classic Airlines needs to guarantee that employees of the company have the right attitude, abilities, commitment and most importantly the motivation required to meet client prospects and ensure customer devotion. This notion submits that employee growth thru staffing, performance, communication, training, supervision, and guidance are vital to the overall achievement of service companies. (Kerin et al., 2006, p.10).
As a way of solving the managerial issue, Classic Airlines must be in a position to comprehend or use the four exclusive components to services for instance:
The above four components are popularly known as the four I’s of services. This is to mean that, services are intangible; to be exact, services can’t be touched or seen before the resolution to purchase. Therefore, in order to help clients evaluate and collate services, marketers basically need to make the services tangible or reveal the advantages of the service offered (Kerin et al., 2006, p.11). Inconsistency refers to increasing, valuing, promoting, and the provision of services, since the quality of a service is basically uncertain. Inseparability can refer to the situation when the purchaser is not able to distinguish between the services itself from the deliverer of the service. On the other hand, inventory is vital since many things are likely to decay and inventory management is expensive (Kerin et al., 2006, p.11). In summary, through the understanding of the four I’s structure, the Classic Airlines can make its way to the top.
The end-state perspective
Classic Airlines is facing many competitors in its line of business, low employee motivation, reducing sales, as well as customer frustration. As a form of end game for the company, it should ensure that it has a huge target market while at the same time consider providing motivations for using their services or flying with their airlines (Tokhi, 2009, p.18). The notion of market attraction is actually a huge target market with very high development and real consumer needs (Kerin et al., 2006, p.11). Therefore, cross-functional teams can be made as way of ensuring that the employees are united.
Identifying and Assessing Risks
The company should predict the market prospects, impending demand, evaluate the competitive scenery and client buying behaviors, as well as identify the present and prospective client needs. Additionally, Classic Airlines must be capable of forecasting the impending demand through the use of marketing research as an intermediary for evaluation.
Making the Decision
The company is presently unengaged with its employees and the customers also, so, when determining the best solution, the company must recognize what its objectives are, what is their end vision, and the problems they have experienced with product growth. These elements will aid the company in deciding how to advance and emerge as the top airline provider.
Research has established that employee motivation has a direct effect on the general performance of a company. Therefore, companies must concentrate on establishing resourcefully and supplying efficiently what the customer needs. Through altering their internal and external marketing strategies, as well as motivate their employees, Classic Airlines would have been able to improve their abilities in establishing and supplying what the client needs and also avoid the main managerial issue.
Case Study, 2008. Classic Airlines Scenario [online] 25 September. Available at: <www.case_studies.com> [Accessed 30 March 2016].
Case Study. (2008). Classic Airlines Scenario. Retrieved on September 25, 2008 from www.case_studies.com
Kerin, R., Hartley, S., Berkowitz, E, and Rudelius, W., 2006. Marketing (8th ed). NY: McGraw-Hill.
Tokhi, M., 2009. A Case Study on Classic Airlines: Practical Marketing Solutions. Journal of Business Studies Quarterly, Vol. 1, No. 1, pp. 16-25.