Mkt 571 - Classic Airlines and Marketing

Classic Airlines and Marketing

Larry Boyd

Marketing MKT/571

Thomas Anderson

January 09, 2012

In today’s airline industry, Classic Airlines is challenging the recent decline in demand and loss in the market share of the industry. As an outcome to the recent decline, Classic Airlines suffered a loss of 10% in the company’s stock market. Also, following the recent decline, members of the frequent flyer program flew less in the recent year, showing a decrease of 21% (University of Phoenix, 2005). Classic Airlines frequent flyer program is known as the Classic Rewards program suffered a loss of 19% in membership participation. The information obtained in the scenario shows a possible threat to Classic Airlines and its investors.

Classic Airlines Board of Directors gave top management the duty of developing and implementing a new marketing strategy in hopes of avoiding bankruptcy and a financial crisis. The goal of the marketing strategy is in hopes of increasing participation of Classic Reward members in the frequent flyer program. Over the next 18 months, a reduction in cost at 15% across the competitive field is required (University of Phoenix, 2005). A team was chosen to perform this task and their duties include coming up with alternative recommendations with solutions to the current problem. The result of the team’s decision must influence the decision-making power of Classic Airlines Board of Directors and top management of Classic Airlines.

Classic Airlines business is a marketing of services because of the frequent flyer program. The frequent flyer program allows the Board of Directors, upper management, and investors to increase their return of investment (ROI). A combination of the frequent flyer program and the Classic