South West Airlines

Southwest Airlines: Case Study

EXECUTIVE SUMMARY

Southwest entered the complicated airline industry in Dallas, Texas in 1971 and ever since has been exceeding everyone’s expectations with unprecedented strategies. Southwest focuses on customer satisfaction: get the customer where they want to go, with low fares and have fun doing it. Their low cost strategies have been accomplished by reducing a large majority of the input costs that most large airline carriers incur causing those large airlines to charge heavily for fares. Southwest’s customers know that they won’t be given the same costly luxuries that other airliners carry but they don’t seem to mind much based on Southwest’s continued year after profitable year. In addition, Southwest has received multiple awards in outstanding customer service compared to all other airliners.

          Southwest Airline Case Analysis

Southwest Airline’s Strategies:

Southwest Airline’s successful strategy consists of three complementary qualities which are focus, divergence and compelling tagline. This short-haul airline believes that by focusing on friendly service, speed and frequent point-to-point departures, its low pricing is able to compete against car transportation. While other competitors try to delight customers by investing in meals, airport lounges and seating selections, Southwest chooses to eliminate or reduces investments in these industry’s competitive factors. As a result, Southwest’s low prices are unbeatable making them the preferred airline in the industry. With a divergence element in Southwest’s strategy, it is able to innovate and stand apart from its competitors. Instead of competing in the existing hub-and-spoke systems, Southwest created a new competitive factor by pioneering point-to-point travel between midsize cities. This niche strategy turns out to be a huge success as by avoiding congested major airports in big cities, travelers are able to reach their destinations on time...