2. • Originated in 1932 as McGee Airways
• Became known as Alaska Airlines in 1944
• Owned by Alaska Air Group
• Based in Seattle, Washington
• 7th largest US airline as far as passenger traffic
• Partners with Horizon Air
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3. • “At Alaska Airlines, our employees share an
uncommon blend of integrity, professionalism,
caring, resourcefulness, and spirit. Every day
we strive to bring these values to life through
behaviors and deeds that go above and beyond
the ordinary - what we call "North of Expected"
and Alaska spirit in action. “
• “To the people of Horizon Air, the Pacific
Northwest is more than a place to do business -
- it's our home. Because of this, we have an
innate interest in the welfare of the region and
its people, and in doing all we can to make it
an even better place.”
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4. • Industry Analysis- Trends
Frustrations in
The Global Airline Industry
Aviation:
2014
2012
2010 • Fuel/Oil
2008 • Pollution control
2006
Time
2004
• Personnel cutbacks
2002 • Global economic
2000 woes
1998
1996 • Recurring safety
Survive Adapt Recover Rethink lapses
Industry State
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5. • Competitiors:
• Many airline competitors such as:
• Southwest Airlines- offers low-fare flights
• MarkAir (from 1980-1995)
• Delta
• United Airlines
• Frontier Airlines
• American Airlines
• Customer Profile
• Market is made up of business
users, families, and independent travelers
• Many customers are “low fare searchers”
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6. • Technology
• Boeing 737-900- Bigger, faster, larger range (3,197
mi)
• Home computer self check-in
• Self check-in kiosks at airport
• State of the art flying systems
• Book tickets and log miles on internet
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7. • Strengths
• Committed employees
• Reliable service
• Environmentally friendly and energy efficient
• Positive company image
• Financial resources
• Strong market research
• Weaknesses
• High production costs (especially fuel/oil)
• Costly training
• High “spoilage” rate
• Hard to make quick schedule changes
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8. • Opportunities
• Continual expansion opportunities for both leisure
and business destinations
• Fuel efficient aircrafts- cost savings
• Added in-flight technology to generate revenue (Wi-
Fi, Digi-players, etc.)
• Link-ups with other carriers to coordinate schedules
• Threats
• A global economic downturn negatively affects
leisure, optional travel, as well as business travel.
• Price of fuel
• Terrorist attacks and plagues can negatively affect
air travel
• Government can impose new costly rules
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9. • The marketing objective is to receive customer
satisfaction values of 95 percent on the 2012
annual customer satisfaction survey, and to
have 75 percent of those customers as repeat
customers in 2013.
• 2. Our objective is to increase our market share
by 5 percent by increasing advertising by 10
percent during the 2012 year.
• Our objective is to have a 90 percent on-time
average (not weather related) in the 2012 year
so that customer satisfaction value will be at
our goal of 95 percent.
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10. • Target Market Strategy
• Geographically, Alaska Airlines directs marketing
and sales efforts within the US, Mexico, and Canada
• Alaska Airlines focuses on the lifestyle of their
target customers. The offer vacations, for those who
need a break, and a good mileage program, to
encourage repeat flying, which is great for business
people too.
• The target market is made up of approximately
235,016,000 people with a growth rate of 14.4%
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11. • Marketing Mix
• Product:
• Flights to and from many US cities and destinations in
Mexico and Canada. Includes checking
baggage, refreshments on the plane, and the flight to
the destination.
• Service for the consumer
• Services differ based on length of the flight (possible
in-flight movie) and cost of the seat (first class seats are
served free beverages and food)
• Product marketing focuses on quality of the service
• A major weakness of the service is flight tardiness
which can be because of weather or many different
factors
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12. • Place/Distribution
• Headquarted in Seattle, Washington with hubs
there, in Portland, and in Anchorage
• Flights are offered through AlaskaAir.com, but also
Travelocity, Orbitz. etc.
• Customers can buy tickets in the comfort of their
home on their computers (even flights that are the
same day)
• Price
• Prices of flights vary from destination to destination
and how far ahead the ticket is booked
• Prices are competitive with the other airlines in the
industry
• Strategy is to charge the lowest possible fare that still
enables the airline to make a profit
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13. • Promotion
• Customers find out about flights on Alaska Airlines
from other customers, email, advertising, and the
website (AlaskaAir.com)
• Not much reliance on direct selling anymore (results
in less customer service)
• Frequent Flier Mileage Plan- encourages customers
to accumulate miles from flights on Alaska Airlines
and then redeem those miles for flights with a 50%
discount or free flights
• MVP flier’s (25,000 miles in a year) and MVP Gold
flier’s (75,000 miles) receive special perks such as
boarding the plane first and receiving free Digi
players
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14. • Must strive to understand their clients and
their ongoing needs
• Need to keep rethinking ways of how to
improve service and stand out from
competitors
• As a company that has experienced success and
has received many awards, including several
Freddies, the most prestigious service award
for airlines, Alaska Airlines must think of new
ways to become more environmentally and
energy friendly and to stay profitable
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15. • The financial objective is to become more
profitable over the next year.
• With the goal of increasing our market share by
5%, we expect our profits to raise by 5% from $1.2
billion per year to $1.26 in the coming year
• Keep the cash flow positive and gross margin higher
than 90%
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16. • Alaska Airlines plans to continually monitor
customer needs in order to provide them with
the best service possible
• The goal is to attract new customers because of
the superior service they receive and retain
satisfied customers
• The ultimate goal is to increase Alaska Airlines
market share in order to overcome the rising
cost of flying and to increase revenue
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