Case Analysis: JetBlue Airways – Adding Value List of Facts JetBlue Airways is referred to as the best-funded start-up airline in U.S. aviation history with an initial capitalization of $130 million (Bodouva, 315).
Its strategy is to combine innovation and technology with common sense. The companys business objective is to bring humanity back to airline travel and to make flying more enjoyable (Bodouva, 316).
No wonder that JetBlue Airways placed high emphasis on customer service. The company strived to be the first paperless airline. In order to achieve the goal, JetBlue tried to replace maximum possible paperwork by computers and information technology in all spheres of its operations.
In such a way, the companys strategy comprised of both efficiency and high-quality service at affordable price. David Neelemann, the founder of JetBlue Airways, developed and utilized several incentives aimed to improve the companys effectiveness. He was one of the first businessmen who implemented e-ticket reservations system. His system was called Open Skies and was sold to Hewlett-Packard in 1998. Later Neelemann decided to develop a new airline. He examined modern market situation and followed the example of successful Southwest model. His strategy was to stimulate the demand in undeserved markets with low fares (Bodouva, 317) through the highly productive use of aircraft and employees. In order to successfully accomplish his business goals, Neelemanns strategy embraced excelling in the attributes of JetBlue brand, such as punctuality, comfort and courtesy. Neelemanns golden rule included three main principles: Perfect execution at every point of contact with the customer; Undertaking all efforts to solve problems and to provide the customer with maximum possible satisfaction when the execution is not so flawless; Treating employees well (Bodouva, 317).
The Essay on American Airlines Competitive Strategy
Evaluate American's 1992 announcement of a new rate structure: a. What changes did American make? American Airlines (American) made four fundamental changes to its rates. First, it moved to a four-tier rate structure; American offered first-class rates and three tiers of coach: full-fare, 21-day advance purchase and 7-day advance purchase. Overall, it expected to reduce coach fares by 38% and ...
These golden rules contributed to creating unique customer appeal.
However, during the last several years, the level of customer satisfaction decreased due to flight cancellations and delays, complicated fare structures, overbooking of flights, mishandled customer baggage and, unsatisfactory level of customer care. In order to solve the problem, JetBlue Airways reexamined its strategy in order to provide the customer with best possible service. The main goals of the company were: high-quality flying experience, strong emphasis on reliability, safety, security, low fares, and perfect customer service. The companys most important competitive strengths are: low operating costs, a fleet of new Airbus A320, a strong and well-recognized brand name, a strong and vibrant service-oriented company culture with understanding of importance of customer service, convenient place of location (at New Yorks JFK Airport), proven management team, and use of advance technologies. Fact Analysis As far as JetBlue Airways strategy was based on customer service, they focused attention on perfect personal service, people, modern aircraft, and state-of-the-art revenue systems. The company developed many value-added services for the customers, such as ticketless travel, assigned seats, comfortable leather seats, no discount seats, an uncommon amount of legroom, special airplane yoga cards, and a TrueBlue loyalty program (Bodouva, 319).
The companys goal is to be customer friendly. When the flight is delayed for more than 4 hours except for weather or traffic reasons, the customer gets a free flight voucher. In order to solve the problem with customer baggage misplacement, the customer gets a $25 voucher when his baggage is misplaced. JetBlues corporate culture is differentiated by the high-quality service all employees provide to their customers (Bodouva, 319).
The Business plan on Customer Service Essay
Excellence in customer service is the objective of all organisations wishing to be successful. However, there is often a gap between customer expectations and management perceptions of customer expectations. Organisations often fail to get close to their customers and correctly read their expectations. Customers expect certain things when they walk into a business, and those with the highest level ...
One of the companys principles is based on equality. Besides, JetBlue place high emphasis on ensuring that each employee views the business from the customers position. It is believed that such attitude will help the company to provide customers with best possible level of service.
The five cornerstones of JetBlues philosophy are: safety, caring, integrity, fun and passion (Bodouva, 319).
However, although the company effectively retains a strong leaders position, its on-time performance of 85.7% is higher than all major American airlines, its incidence of baggage mishandling of 2.33 per 1,000 customers is lower than all major U.S. airlines, and its rate of customer complaints is very low, it is natural that the company strives to undertake all efforts in order to retain its positions and to be one step ahead of its competitors. In addition, as far as JetBlue Airways tries to offer its services at the most affordable fares, the company strives to minimize its expenditures. For example, the company strives to limit cabin service (compared to Southwest Airlines that offer the customers meals during the flight), uses point-to-point flights (compared to hub-and-spoke), employs reservation workers that work from home, books reservations online, keeps a new fleet of aircraft, makes flights to smaller airports, uses a nonunion personnel, and offers higher wages and profit sharing to refrain the employees from joining unions. Nevertheless, the company faces certain problems. Along with potential expansion, the company will face increase of maintenance costs (according to preliminary prognoses, the costs will increase 25% to $1.6 million each year per year (Bodouva, 324).
Additionally, as far as personnel become more senior, it will require more tangible benefits and pensions.
In case employees join unions, the labor costs will increase, cutting the companys profit by 28%. As far as flights become longer, the necessity to provide the passengers with meals may appear. In such a way, the companys position to focus attention on maintaining loyalty and customer value is quite logical. Problem Statement The case examines the experience of JetBlue Airways and its successful strategy based on five core values: safety, caring, integrity, fun and passion. The central problem of the case is as follows: despite the companys effective strategy and high emphasis on the level of customer loyalty, with future expansion and growth the company may face increase in costs (both due to issues concerning more tangible personnel benefits and improved customer service) and, consequently, may lose some of its loyal customers. IN such a way, the companys main problem is to shape best possible strategy to retain its position in the market and to improve its customer service. Alternative Solution Along with JetBlues undertakings, there are several solutions available for consideration.
The Term Paper on Wal Mart Customer Company Sam
Many retail stores are created by an owner that has a very creative idea for marketing products. Not all stores seem to stay in business partly due to the lack of interest shown in later years of the business's growth. The chains that tend to succeed are of course financially backed but the owner of the stores stays creative and innovative in their ideas to keep promoting the chain. One of the ...
One of them implies absorbing different loyalty programs from the successful experiences of other companies adjusting by the companys needs. For example, JetBlue can implement the strategy of customer loyalty surveys in order to check whether the meals should be served during the long-term flights by cost of increased ticket price. Additionally, customer loyalty surveys can help the company to be open to the customers feedbacks and to react quickly and correspondingly by learning about the customers requests and expectations. Recommendation Despite of the fact that JetBlue Airways performance is much higher than all major U.S. airlines, there are several recommendations the company may take into account in order to retain and to strengthen its marketing position. The company may examine a possibility of adding new services, aimed to provide customer with the highest level of satisfaction. The personnel should understand the importance of the core values like high level of reliability, empathy and understanding, responsiveness to the customer demands, friendly attitude, etc.
to create an atmosphere of memorable flights and to exceed the customers expectations. The company also may reshape its loyalty programs concerning rewards and discounts..
