Song Airlines Business Case Essay

898 Words4 Pages
Song Airlines Case

Song airline was a low cost carrier subsidiary of Delta airlines that started in 2003. It was formed to compete with JetBlue and other low cost airlines for the Florida market. The market environment at the time of the case was extremely difficult with the rising costs of fuel, increasing security requirements after 9/11 and customers' expectations of lower fares. It has forced many big players in the airline industry into bankruptcy. The operational costs which include gate fees, ground operational costs etc. were increasing causing even more problems for the airlines. The fares in the Florida route were decreasing while the costs were ever increasing making it difficult to remain operational in that space.
The
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7. Used novel techniques by opening concept stores in Boston and New York to attract customers.
Song Airlines spent a lot of time analyzing the past data and did a lot of market research to come up these various strategy points. And I think, it clearly shows that they used experience curve techniques to analyze and use the data like gate utilization, flight attendant working times, seat usage, and flight route scheduling etc. to optimize the operational aspects of running the overall operations. It was stated that based on these initiatives they achieved 20 – 25% lower operational costs in running the airline as compared to running it in a Delta configuration. By using the various main concepts like low fares, great services and targeted marketing they were able to achieve good success. By focusing on the main strategy aspects simultaneously like lowering operational costs, optimizing logistics, increasing the service level and perceive value by portraying a high end service, Song was able to integrate these various aspects nicely.
Some of the key opportunities in the current market environment for airline industry are:
1. Increasing Customer service levels. Consumers are generally expecting more fro airlines and Song has already addressed this in original strategy which was very customer satisfaction based.
2. Understanding the responding to changing consumer behavior patterns. This is something
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