Case Study On Southwest Airlines: Is It Still The King of Cheap Flights?
They need to focus on all passengers rather than the niche market, which provides them powerful competitive advantage, regarding their core strategy that passengers will get their destinations, at the lower prices, or possible fare, they might affect customers from various segments. They have to target the price sensitive passengers, who were conscious and who wanted the leisure travels, and the convenience, the time-oriented travelers. Their strategies were more efficient than any other was, the exceptional service at the low prices was a centre of attraction for people from all segments, the customers were satisfied from the services. Southwest’s also concerns and prime target should be the niche market, they can earn more profit by giving convince facilities to them, the consumers could be attracted through providing the exceptional services.
The southwest’s airline tried to provide the best services at lower cost, and they became the most short-haul, high frequency and low-fare airline, which give them, advantages and the disadvantages, the pros are that they have generated much profit in less years, they were getting the competitive advantages, the people or passengers were getting attracted towards the airline. They captured the large target market, by short-hauls, they were able to fight the bigger companies, and they were having the strong market power and good will. The cons were also there, the competitors were well aware of the strategies of southwest’s airline; the competitors also narrow their prices, said that they are providing quality services, they were heavily dependent on the passenger’s revenues, and in this case, risks could be increases.
The southwest’s airline always meets the customers’ expectations, their motto was to keep the clients or customers happy, for this they have maintained, trained and motivated their staff, and their staff was energetic and dedicated. They take care of the customers from the various aspects; they have the good relationship with the customers. The unions were independent and have the flexible contracts, this is the reason the workers or staff work for long hours, to any company staff or employees are the assets that can enhance the company growth and can lead the company towards success. The staff or union was free as southwest’s airline has good relationships, the effort was there to retain and train the staff, the customers feel happy because of the staff, the unions help the customers when they needed, the unions were effective and favorable for the southwest’s airline.
The southwest’s airline, always offered the less prices as compared to the competitors, the prices war in 1993, give advantages to the customers, as the customers were able to get the flights at cheaper prices, the southwest’s airline lower down its cost than Continental and US Air. However, they also lower down the cost for the effectiveness and to gin the profits, the implications may not be effective for the airline market. The airline market could suffer the loss in this way, the competition could be effective for the customers but not for the companies or airlines. The airlines were suffering, as they were earning no or very less profit, there could be downfall, the airlines in this case needed to decide the best pricing for the services from Cleveland to Baltimore, so all 3 airlines could earn good profit.
Price-cut strategy is the most effective and efficient way that is used by the companies to attract the customers, however, the customers attracts because they want the services at lower costs. Any competitors could only get the advantage the for the short-term by using the cost-cut strategy, as the market or customers realize that the services may not be that efficient or effective like others, they stop using the services. The price cut strategy is not always effective, the companies are reliable on the customers, and in the case of loss of customers, the company can suffer a big loss, the companies need to set their cost according to the prices of the market, so the people or customers rely on them, and know that they are getting better services. The cost cut strategy, in the case of southwest’s airline, was also not effective for the long-term, there are need to provide the customers with the better services in better or fair prices, if the company want the competitive advantage.