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Classic Airlines and Marketing Concepts The Classic Airlines scenario offers numerous examples of the marketing concepts found in Marketing Management. The Classic Airlines scenario reveals the airline is the world’s fifth largest airline and commands a fleet of more than 375 jets. The airline has been profitable but also faces challenges that plague many airlines today. Classic Airlines saw a decrease in their share prices, and a decrease in the number of customers enrolled in their Classic Rewards program (University of Phoenix, 2010).
One of the marketing concepts says the key to achieving organizational goals consists of the company being more effective than competitors in creating, delivering, and communicating superior customer value to its chosen markets (Kotler & Keller, 2006). This concept is prevalent in the airline scenario as the management team tries to find a strategy to convince their loyal customers to return as well as gain new customers. Amanda, the CEO of Classic Airlines, mentioned the Customer Loyalty Report shoed membership in the Classic Rewards program was down 20% from last year.
She also stated the company could not get the company’s loyal frequent flier customers to choose Classis over the competition. The scenario shows that Classic Airlines is not more effective than their competition in creating, delivering, or communicating customer value (University of Phoenix, 2010). The production concept also can be seen in this scenario. This concept says that consumers will prefer products that are widely available and inexpensive (Kotler & Keller, 2006). Amanda mentions in the meeting that Classic Airlines had already dropped their prices to compete with the competition.
The companies began to get into a price war, and Classic Airlines could not drop their prices any lower. As a result, many of their customers began to go with the company that offered the lowest cost (University of Phoenix, 2010). Another marketing concept can be found in a statement made by Renee. She says,” I hear customers tell us what they want, but we don’t have the service elements, operations procedures, or marketing programs in place to deliver. The higher ups think they know what makes our customers tick, but they haven’t listened at all” (University of Phoenix, 2010, page 5).
The core concept that applies here is the customers needs, wants, and demands. The marketer must try to understand the target market’s needs, wants, and demands. Needs are the basic human requirements. Needs become wants when they are directed to specific objects that may satisfy the need. Demands are wants for specific items backed by an ability to pay (Kotler & Keller, 2006). Renee believes that Classic must find a way to meet the customer needs, so the customer will want to be in the Classic Reward program.
However, she believes there is no way for classic to meet the demands because some areas of the company are not as productive as they could be (University of Phoenix, 2010). One last concept I found in the scenario was relationship marketing. Relationship marketing has the aim of building mutually satisfying long-term relationships with key parties to earn and retain their business. This is a key goal in marketing and a key goal for Classic Airlines (Kotler & Keller, 2006). One problem for the airlines is their current marketing network is not as strong as the competitions, because Classic is losing profits (University of Phoenix, 2010).
Marketing has many concepts that companies must abide by to achieve success. Classic Airlines is an example of what may happen if a company fails to take the concepts into consideration. The result is loss of customers, profits, and eventually failure. References Kotler & Keller. (2006). Marketing Management (12th ed. ). New Jersey: Pearson-Prentice Hall. University of Phoenix. (2010). Classic Airlines Scenario. Retrieved from https://ecampus. phoenix. edu/classroom/ic/classroom. aspx.