Mkt_571_Week_1

According to this week’s reading marketing deals with identifying and meeting human and social needs (Keller and Kotler, 2006). In a diverse industry many companies produce products that are similar but what set them apart from their competitors are the marketing schemes that each company practice. When a company use a good marketing strategy that strategy in return helps the company advance pass its competitors and into number one spot. Competition has always been steep in the airline business and Classic Airlines is no different and face marketing challenges. This paper will discuss marketing challenges and alternative to those challenges. Company Background Classic Airline has an armada of 375 plus jets which provide services to 240 cities which would make Classic airline the fifth largest airline company in the world. The airline has approximately 2,300 flights daily. Classic airline employs 32, 000 employees, and earned $10 million on $8.7 billion in sales. Like many airlines, Classic has ran into difficult times because of decreasing stock prices. The reason behind the decrease of stock is because customers are doubtful regarding airplane safety. Shares for Classic have witness a ten percent decrease as well as a reduction in members of classic reward program by an unprecedented 19 percent and a 21 percent decrease in flights per remaining member. The board of directors would like to increase Classic’s Return on Investment (ROI), they believe that the frequent flier program will increase the ROI and help the company. The Board also would like to implement a cost reduction of 15 percent companywide over an 18-month span. Challenges When building a unique program similar to the Customer Relationship Program (CRM) all aspect and resources of the company’s competencies need be addressed to meet the different requirements. The Chief Executive Officer (CEO) and Chief Marketing Officer (CMO) do not share the same vision which can hinder advancement for Classic Airlines. The CEO, like all CEO’s wants the company to fire on all cylinders, but wants to use limited resources such as money. Whereas the CMO would like to do what is necessary to draw and retain customers. With business steadily growing the CMO’s would like full control but CEOs want only the CMO to play a partial but active role. The expectations between the two are so much different and can harm the company in the long run. The CEO need to grasp the concept that the new trend is to focus on customers and money is needed to make it transpire. The Chief Marketing Officer needs to make the CEO understand that using this approach and resources will produce more profit and better results because more satisfied customers. Alternatives Classic Airlines believe that presenting the Customer Relationship Program (CRM) to customers it will in return increase customer satisfaction which will lead to customer retention and possible former customers returning to Classic airlines. Developing a Partnership with a Switzerland Airline is a big step. Classic believe this move will help with customer satisfaction and development. Utilizing the holistic marketing approach, the Chief Marketing Officer attentions are to move the environment from negative to positive . According to Keller and Kotler (2006), “The holistic marketing concept is based on the development, design, and implementation of marketing programs processes, and activities that recognized their breadth and interdependencies” (p. 17). Regarding holistic marketing, Keller, and Kotler (2006) state, “Marketers hope to achieve profitable growth through capturing a larger share of each customer’s expenditures by building high customer loyalty and focusing on customer lifetime value” (p. 18). This methodology will attract customers back to Classic as well as raise customer satisfaction that will steadily increase return of investment. Conclusion The holistic approach will help Classic Airline increase the customer base and retain current customers; it will also increase customer’s satisfaction. When customer’s satisfaction is high, customers have the tendency talk to others; which in return bring new customers to the company. The CEO and CMO need to come to a common ground because without customers the company will go bankrupt. References Kotler & Keller, (2006). Marketing Management (12th ed.). New Jersey: Pearson- Prentice Hall. University of Phoenix. (2010). Classic Airlines [Computer Software]. Retrieved from University of Phoenix, Simulation, MKT571 website.