Professional Documents
Culture Documents
Problem
- Need to regain competitiveness in leisure segment to secure market share
Recommendation
- Pursue forward integration by furthering its MLT Vacation business to increase its
differentiated value proposition, build brand loyalty, and introduce a new revenue
stream
From the Clouds: Introduction to Airlines and Delta
- US airline industry is a $1.5 trillion industry
- Two main strategies within the industry
- Differentiators: Provide customers with exceptional service or amenities; hub and spoke model
- Low Cost: Provide customers with the lowest price and fewer amenities, point to point
- Delta entered into passenger air travel in 1930 and has grown to one of the worlds largest airlines
- Second largest US Airline with 17% market share
- Operates as a differentiator with a hub and spoke model
- More than 15,000 daily flights to 337 locations in 62 countries
Core Competency
Creating an exceptional customer experience throughout the entire travel process
Value Chain
79% of domestic airline trips are leisure, twice as much spent on leisure travel than business
Economic Ancillary fees a growing revenue source as airlines shift towards debundling services
High speed trains and more efficient cars affecting regional travel options
Technological Price aggregators and comparison sites pressuring fares across carriers
Ecological EPA regulation of emissions and shifting focus toward sustainable biofuels for aircraft
High Buyer Power
Many buyers
Most have little brand loyalty
Face little to no switching costs
Mission
Provide a complete travel experience through operational efficiency, strategic
partnerships, and continuous innovation
Transporting passengers
and cargo to over 337 Offering exceptional In-flight experience Main passenger segment:
Strategic alliance with destinations customer service throughout Business travellers
SkyTeam member, Air France, the entire travel experience Awarded Overall Best
KLM, Alitalia, Virgin Atlantic Maintaining, renovating, and Business Airline for 5 Leisure travellers
overhauling aircrafts Offering the most consecutive years
Airports destinations of any US air Other air carriers
Refining oil into jet fuel carrier
Shareholders
Offering vacation packages Leading the industry in
Suppliers maintenance, renovation,
and overhaul of commercial
air crafts
Years 2 & 3
- Run domestically beginning with festivals and expanding into other events
- Implement marketing and co-branding campaigns to raise awareness for
experience-based millennials
Questions?