Segmentation and Target Market for Southwest Airlines

2020 Words Oct 27th, 2015 9 Pages
Segmentation and Target Market for Southwest Airlines
Steven Garnes
MKT/571
August 10, 2015
Denise A. Rueb

Segmentation and Target Market for Southwest Airlines
Introduction
Southwest Airlines was formed in 1967 by Rollin King and Herb Kelleher and started service in June of 1971. The airline is headquartered in Dallas, Texas and originally operated flights within the state of Texas. The company has since expanded and now operates flights from Dallas to almost all major cities in the United States and is considered the largest low-cost carrier in the country. “Southwest seeks to offer a travel product that is built around flights targeted to specific demographics and ticket pricing that is simplified so that passengers know
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This business model has helped the company identify its target market and market segmentation. Operating as a low-cost carrier means the company is seeking to serve cost and value-conscious consumers, small business executives, and customers who are traveling short distances and prefer a low-cost fare. This is the first segment of its target market. The second segment includes families who are value-conscious, and senior citizens.
Demographic Segmentation The target demographic for Southwest is very broad. The fact the airline has a brand that appeals to price-conscious travelers who do not mind the airline’s no-frills philosophy means it attracts lots of small business owners, young adults, middle-class families, and those who are traveling a short distance. Southwest operates a simplified airline to keep costs down. It only operates one type of aircraft, and its no-frills plan includes no assigned seats or class seating, no meals, and no onboard movies. The company has a strong emphasis on customer service and a differentiation strategy to keep customers happy and loyal. When hiring for customer service positions within the organization, Southwest focuses on attitudes rather than skills and encourages peer hiring. This strategy helps the company identify those who fit the organizational culture and who are most likely to further the company’s philosophy of

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