Marketing Strategy, SOUTHWEST AIRLINE - Essay Example

Due to this the competition has become rigorous as the airlines are forced to cut down cost and jobs and fill the seats. Southwest is a low cost carrier which has always offered low fair deals to its passengers. In the case too it is offering lower rates and deals. These new rates though are not for all the destinations and flights, they are only specific to certain locations and restrictions are applied. Then there are other deals offered by hotels like Sheraton, they are offering discounts on early bookings along with Southwest.

All these are as a result of the recession, competition and off season in the airline industry. Southwest is using sales promotion as a marketing strategy to overcome the crisis of reduced sales. This is just one way it can counter the problem. The company can respond to such financial crisis through liquidation, taking government subsidies, improving the efficiency and by forming alliances with other carriers. These are some of the strategies that are used by various airlines. The key problem these airlines are facing is the high cost and low sales.

The key issue is the rising cost of the company which has lead to reduction in sales due to which marketing strategies are to be applied. Since it is an oligopolistic market structure hence other key players are going to follow the strategy too. One of the ke Problem statementOne of the key problems that the company is facing at the time is the low sales. The company has come up with various tactics and one of them is the sales promotion in order to attract passengers. The passengers will get the same service at lower rates but fewer destinations and conditions apply.

Alternate solutions There are other ways of marketing too. Southwest can make an ad campaign which shows that the airline is offering lower rates at times of recession too which shows that they are concerned. This will leave a positive impact in the eyes of the customer and intact the customer loyalty. The company can close its less productive routes because at this time the aim is to reduce cost and offer lower rates to the customers. This will save costs and that can be passed on to the passenger in the form of sales promotion.

The company can come up with different promotional deals which can be advertised on the internet or the television. This will be costly but will create awareness among the customers. '''Selected Solution They should close down their unprofitable routes and focus on the ones which can generate high profits for them. This is very important because fuel price are already fluctuating and cost minimization should be the top most priority. Expected results It will save costs; moreover the employees need to understand the situation so that they do not bargain on wages or any other matter.

The entire firm will have to work together and bring down the cost. Once the cost is saved then that advantage can be passed on to the customer through marketing efforts and spending that on low fares and more advertising. Negative resultsThe passengers who travel through that route would face problems now since that service would be closed now. This will leave dissatisfied customers. However, there could be one way which is that the company doesn't completely close down the service but make it less like once a week instead of three so that customers do not find it inconvenient.