Virgin America Case Study

Case Study Assignment_ Decision Essay: Virgin America

1. Brief summary of case

Virgin America is a United States-based airline that began service on August 8, 2007. The airline’s stated aim is to provide low-fare, high-quality service for long-haul point-to-point service between major metropolitan cities on the Eastern and West Coast seaboards. Their current audience is upper-middle class 18~30-year-olds who enjoy having a crazy, wild time and fly four to six times per year.

However, compared to their biggest competitors, JetBlue and Southwest, few people know much or anything about Virgin. And financially, the company was not profitable for the first five years, and has continued to struggle since its establishment. They hope to target a particular type of customer for success: those looking for luxury.

Problem Statement

While Virgin America’s branding strategy seems to be moderately successful, the company has been struggling financially in terms of profitability. The problem for Virgin America was clear in they needed to define a clear positioning for its customers and figure out a way to keep the demand strong maintain market share and focus on specific customers in their target market. 

2. Recommended Decision

Target customers who look for luxury and business customers

3. Decision Options:

1) Target customers who look for luxury

2) Target business customers

3) Target customers who look for luxury and business customers

* Virgin America will only serve first class and main cabin select.

4) Target customers of main cabin

5) Status quo

4. Proof of Recommended Option / Critique of Options

* Recommended Decision: Position Statement

Reasons:

Criteria | Evidence |

Product/ Demand | Its first class section is consistently booked, with prospects to expand the section. |

Product | One of Virgin America’s mission is to offer high-end facility and service. It is also what the company has been working on during previous years. To...