3. SOUTHWEST AIRLINES

4. • Sheraz Ahmed
• Usama Tahir
• Naveed Alam

5. • Introduction
• Achievements
• Strategies
• Product
• Target Market
• Product Positioning
• Building brand loyalty
• Pricing Strategy
• Conclusion

6. Founded in 1967 by Rollin King, Herb Kelleher
Started operations in 1971 with three Boeing 737s after winning
the lawsuits against them
Well known for its Low Fare policy and low cost of operations
Presently operating in more than 60 countries with over 500
Boeing aircrafts

7. Operate more than 3300 flights a day
35000 employees engaged
The United States’ most successful low-fare, high frequency,
point-to-point carrier
Known as a “discount airline” since 1973

8. Achievements
For the 12th year in a row, FORTUNE magazine recognized
Southwest Airlines in its annual survey of corporate reputations in
2008.
2003 Selected as “AIRLINE FOR THE YEAR”
2007 included in top 100 most innovative technology
organization
First airline to establish a home page on internet
Ranked number one in customer service
36 consecutive year of profitability

9. Fly short routes
“Fun-LUVing Attitude” for in-flight
15 minute turnaround time
“Bags fly free” policy
Employees first, customer second policy
Love Bites & Love Potions
DIFFERENTIATION STRATEGY

10. A hedge is an investment position intended to offset potential
losses/gains that may be incurred by a companion investment.
SWA used hedging for the following objectives:
Plan towards profitability.
Plan cash flows.
Lower overall fuel expenses.
INTEGRATED LOW COSTS

11. Use a single aircraft model (Boeing 737)
Point to Point model
Use secondary airports (Less Congested)
Operate in mid-sized cities
No complementary meals

12. Southwest’s product is Travel
Competition – not just other airlines but any mode of
Transportation
1. Frequent, conveniently timed flights and low fares
2. Point-to-point route system as compare to spoke-and-hub
3. Direct nonstop

13. Cost and value conscious consumers. Mostly male
Small business executives
Travel short distances
Prefer low cost fares
Frequent schedules
The other half consists of Value conscious consumers (male, female,
families and senior citizens)
MARKET SEGMENTATION

14. • Only low fare
• Short haul
• High frequency
• Point-to-point carrier
• Fun to fly

15. What is the southwest effect?
1. Air fares go down
2. Tourist traffic increases

16. 1. Charge the lowest possible fare
2. Compete with all other forms of transportation, including
automobiles
Instead of increasing fares when market gets busier and more
people are flying, it simply increases the number of flights