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Southwest Airlines Marketing Proposal

Group 7
Andrew Daley
Lydia Thankambaby
Megan Mugavero
Henna Kim
Nick Fu

Table of Contents
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2
3-4
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7-15
16-20
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22

Cover Page
Table of Contents
Company Brief
Marketing Problem
SWOT Analysis
STP Analysis
Marketing Mix
Conclusion
End Page

Company Brief

Southwest Airlines was founded in Dallas, TX in 1967. It began based out of Love
Airfield, and had an early history of being a low cost airline in the Southwest region.
Flights out of Love airport were originally limited by the Wright Amendment, a federal
law that limited non-stop flights out of Love Airport to Texas and the surrounding
area. This was repealed in 2006.
Since the Repeal of the Wright
Amendment, Southwest Airlines has
expanded non-stop flights to airports
nationwide, and as of 2011 carries
more domestic passengers than any
other US airline.

Love Campaign

Southwest recently completely rebranded the company in what they call


the Love Campaign. This repositioned them as a competitively priced
airline with a focus on their enthusiastic service, triple bottom line, and
perks such as no baggage fees and no assigned seating.

Marketing Problem

Southwest recently acquired new


terminals in New York and
Washington D.C., and they need
to begin building a brand in those
cities
Southwest has also begun a
transformation from the cheap
alternative, to a competitively
priced option that differentiates
itself through its superior service
and personable brand

SWOT Analysis

S.T.P Analysis

Geographic Segmentation
New Markets
Recently acquired terminals
New York-LaGuardia
Washington DC-Reagan

Existing Markets
DFW, Houston, etc.

Targeting & Positioning

Demographic Segmentation

Families
Require more friendly and flexible
service
Single Travelers
On-time oriented
High income vs low income
High income less price sensitive
Low income most price sensitive

Targeting & Positioning

Psychographic Segmentation

Heart Lifestyle
Enthusiastic people who are
looking for a different, more
personable flight experience
People who are environmentally
conscious
People who appreciate charity and
philanthropy
May alienate more business
oriented individuals

Targeting and Positioning

Behavioral Segmentation

Cost/Value oriented consumers


Most price sensitive
More sensitive to
promotions
Service oriented consumers
Less price sensitive
Brand loyal
Sensitive to perks

Targeting and Positioning

Marketing Mix

Price
Keep prices low, but increase
them if necessary to maintain
quality service.

Cheap market is overtaken by new


low cost airlines
Southwest no longer just the cheap
airline company
Compete by keeping competitive
prices while providing better
services

Product
Maintain high standards as an airline
Never institute baggage fees
2 bags free per passenger
Keep employee benefits
Employees and families fly free/discounted
Continue to hire enthusiastic employees
Happy workers tend to make for happier
customers

Promotion
Direct promotions
local flyers and free promotional points

Keep current frequent flyer system


Points earned determined by flight cost
Reward system

Conventional advertisements
Billboards, commercials,etc.

Increase online presence

Place
Utilize online ticket distributor services

Travelocity
Orbitz
Expedia
Priceline

Conclusion
Southwest airlines already has the best service and
value in the industry, they simply lack the brand
recognition of larger firms
Aggressively promote Heart brand in new markets,
and offer promotions to begin building a strong
customer base
Maintain quality service in old markets while informing
the market of their new non-stop destinations and
competitively advertising perks that competitors lack (i.
e. baggage fees)

Thank you!