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Today, Classic Airlines faces the problem of the ongoing deterioration of its marketing performance. In spite of all the efforts of the company, Classic Airlines keeps deteriorating its marketing performance that undermines its competitive position and leads to a profound crisis within the company. In this regard, it is important to find out the roots of the marketing problem of Classic Airlines that caused the deterioration of its marketing performance. On the ground of the analysis of the identified problems of the company, it is possible to develop a plausible solution that could improve the position of the company and accelerate its development. In actuality, it is obvious that the current problems of Classic Airlines are determined by both internal and external factors which prevent the company from the effective and successful marketing performance and it is only through the elimination of key causes of its problems it is possible to solve the problem of the deteriorating marketing performance of the company. In this regard, the improvement of the effectiveness of work and quality of services of the company along with the alliance or merger can be help the company to overcome its current problems.
Problems of Classic Airlines
First of all, it is necessary to start with the analysis of the current problems Classic Airlines is facing. In this respect, it is worth mentioning the fact that Classic Airlines is not the only company that faces substantial difficulties and deteriorates its marketing performance. At the same time, the situation in Classic Airlines is characterized not only by the deterioration of its marketing performance but also by the growing customer dissatisfaction and deterioration of the company-customer relationships.
In this respect, it is possible to single out one of the major problems of Classic Airlines that is the problem of high costs of flight. In fact, the company has to raise its prices to cover the high costs of flights. Naturally, passengers are dissatisfied, when they have to pay more than they get used to. The growing price of the services provided by the company leads to the drop of the number of passengers. In such a situation, the company naturally attempts to save costs and minimize its expenditures. However, the latter is not an easy task to do.
In actuality, the company can hardly save costs substantially because of the high fuel price, which increases the costs of Classic Airlines substantially and forces the company to raise the price of tickets passengers have to pay. In fact, the fuel price is one of the main problems the company is currently facing because the galloping oil price and the risk of their unexpected rise undermines the position of the company and ruins all long-run plans of the company (Littman, 2002). The rise of the oil price leads to the rise of fuel price Classic Airlines has to pay. As a result, costs of flights increase respectively to the rise of the fuel price and the fuel consumed by the company’s aircrafts.
In this regard, Classic Airlines is not the only company that suffers from a consistent rise of the fuel price. In actuality, it is possible to speak about the crisis in the aviation industry at large. However, the high fuel price is not the only reason of problems in Classic Airlines and aviation industry at large. The emergence of international terrorism is one of the major threats to the development of the aviation industry, which has already provoked a profound crisis in the early 2000s and its effect can be traced in the contemporary aviation industry as well. As a result, the confidence of consumers in the reliability of airlines decreases and they feel secure while using services of such companies as Classic Airlines. Hence, the aviation industry suffers from a consistent drop of the number of passengers that deteriorates the position of such companies as Classic Airlines even more.
At the same time, the company is also responsible for the deterioration of its marketing performance and growing dissatisfaction of customers with services of the company. In this regard, the low quality of services provided for customers is one of the major causes of the customer dissatisfaction and the deterioration of the marketing performance of Classic Airlines. Naturally, customers expect to receive services of the high quality, especially when they pay the high price for tickets. However, in case of Classic Airlines many passengers are dissatisfied with the quality of services, especially delays which make flights uncomfortable. As a result, customers simply prefer using services of Classic Airlines’ rivals that leads to the drop of the number of passengers in Classic Airlines.
Furthermore, another problem that causes the deterioration of the marketing performance of Classic Airlines is unions and strikes which affect the company and the aviation industry at large. In fact, employees are dissatisfied with their position in the company and their salary that forces them to strike and to struggle for the improvement of their position. In addition, the company attempts to save costs and regard job cuts as one of the ways to save costs that also is an important factor that provokes strikes and resistance from the part of unions. The internal conflicts provoked by strikes and tension with unions lead to the deterioration of the marketing performance of the company.
Finally, the competition in the aviation industry is an important external factor that undermines the position of Classic Airlines in the market. In actuality, the competition in the aviation industry grows stronger and airlines operating internationally prove to be in an advantageous position compared their smaller rivals. In addition, governments tend to eliminate barriers to protect domestic airlines because the process of globalization contributes to the elimination of fiscal barriers. As a result, the competition grows even stronger increasing the pressure on Classic Airlines.