The development of Internet technology made it a lot easier for airlines to conduct business. The need of ticket agents decreased, which at the same time decreased costs. Also, with the use of the internet customer can compare the prices of competitors, which is to advantage of the low cost airlines. The industry goes along with upturns and downturns of the economy. The airline industry is also highly dependable on extreme events like the September 11, 2001 terrorist attack on the World Trade Center. Such events create fear in customers and therefore lower demand. Another important factor is fuel prices, which keep going up. Different competitors have different strategies on how to survive. ...view middle of the document...
Regional airline industry is very competitive and for that reason customers can enjoy lower fares, higher flight frequencies, and more alternatives on many routes (Moores).
The economy downfall made regional airlines managers look for new strategies. JetBlue Airways and Southwest Airlines focused on reducing the costs and offering cheaper products. New, low-budget flights offer many different amenities during the journey. Gourmet sandwiches, $5 martinis, free TV; leather seats are standard now in the low budget airline industry. As time passes by consumer become more demanding and the competition get tougher. Every company needs to adjust to current trends (Arndt).
Arndt, Michael. "Flying Budget, But In Style." Businessweek 3874 (2004): 114-115. Business Source Elite. Web. 11 Nov. 2013.
Moores, Victoria. "Adapt Or Die." Air Transport World 50.5 (2013): 33-34. Business Source Elite. Web. 11 Nov. 2013.
Shifrin, Carole. "Regional Reviews." Aviation Week & Space Technology 175.15 (2013): MRO1. Business Source Elite. Web. 11 Nov. 2013.
Wagner, Kurt. "A Big Battle Over Small Jets." Fortune 168.3 (2013): 24. Business Source Elite. Web. 11 Nov. 2013.
a) Competitive strategies
The main competitors of JetBlue are Delta Air Lines, Inc., SkyWest, Inc., Southwest Airlines Co., US Airways Group, Inc., and United Continental Holdings, Inc. JetBlue was the first airline to offer low cost flights. One of their value chain activities, mainly inbound logistics, can be web-based booking. Customers can book their flights at the comfort of their own home or office, without unnecessary trips to the travel agency and waiting in long lines. The probability of being dropped also decreases because the computer system has a better control over booking tickets than a human ticketing agent. When it comes to operations the management introduced the paperless cockpit plan. It reduces costs by not wasting as much paper as before and it saves time of looking for important information. Another operation improvement is single aircraft type. It saves training time and facilities. In the outbound category, JetBlue invested in new bigger airplanes. It prevents the airports of becoming overcrowded which reflects in on-time flights. In marketing and sales JetBlue uses Internet as the main distribution channel. It is the cheapest channel available everywhere in the world right now. It helps in keeping the costs and prices low. The company recently changed their market segment. The focus shifted from pleasure travelers to business travelers. Also frequent fliers can enjoy lower prices and many bonuses which avoid losing customers. In the services category JetBlue makes sure that there is constant communication between the customer and the company. Every customer gets e-mails notifying them of any changes and inconveniences. If a major inconvenience occurs at the company’s fault, customers get refunded or get a major discount on a next flight. Also the staff is well...