Case Study sobre la empresa Air Fair.

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Seminar in Strategic Management

Professor Michael J Connor

Fall 2015

Abhishek Chowdhary

Andrew Jones

Jessica Means

Ricardo Martin Coloma

Madeline Cruz

Table of Contents

EXECUTIVE SUMMARY

THE COMPANY

        a. Mission Statement

        b. Corporate Culture (Guiding Principle)

        c. Historical direction & results

        d. Management

MARKET RESEARCH

SERVICE (PRODUCT) DEVELOPMENT

        a. Descriptions of services & products to be offered

        b. Pricing

        c. Financials

MARKETING PLAN

        a. Consumer Awareness

        b. Market Share

        c. Diversification

        d. Channels of distribution

        e. Other

SITUATIONAL (SWOT) ANALYSIS

        a. Strengths

        b. Weaknesses

        c. Opportunities

        d. Threats

OPERATIONAL PLAN

        a. Strategic & Tactics

        b. Client Segmentation

        c. Positioning

EXECUTIVE SUMMARY

The world may seem smaller with social media and Google. Nowadays we can keep in touch with distant family and friends via Facetime, Skype, and other virtual communications. As for the world, we can always look it up on Google Earth. Yet nothing compares to the energy and nostalgia of physically having your loved one with you or personally experiencing the wonders of the world.

People want to travel the world for family and/or tourism. The top three reasons why people don’t travel are money, time, and travel logistics. Imagine a world where these weren’t the reason, the only reason would be you’ve used up all your vacation time at work, though more people are working remotely. AirFair is changing the airline industry. Our strategy begins with the most immediate challenge to solve, money. Traveling by plane is expensive. Our company developed a program which reduces the expense of a ticket via Branding in order to offset the cost to the consumer. Then we approach the struggles and delays of airports, we will maximize the capacity and flow using Biometrics.

People can choose to travel by car, but a car can only get you so far. It’s flying that will makes dreams and hopes come true, and it’s much quicker flying. Traveling by plane is expensive. Imagine a world where flying wasn’t a luxury.

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MISSION STATEMENT

• To have friends and families spend less money on airline tickets and spend more quality time in person.
• To make the airline industry a profitable and growing industry.

VISION

• To make air travel an “affordable experience”

CORPORATE CULTURE

Customers experience is our top priority. AirFair cannot directly market to the consumer. The success of company depends on the relationships built with the airlines, through trust, loyalty, and integrity. AirFair’s corporate culture is people oriented. Our strength comes in the power of communication. The great communication within our company is reflected in our communication to our customers. Our innovations are result of each of our passion of travel and improving the way of life. At AirFair we know the importance and the struggle it is to visit family as well as extending your boundaries to explore new places.

HISTORICAL DIRECTION & RESULTS

The airline industry, especially in the United States, until now have struggled to earn profits. According to US Today, US airlines posted record profits in 2014 after losing billions for much of 2001-2009. Customer demand has increased slowly but steadily. According to an article in Business Travel news, “the number of passengers in 2013 flying on US based airlines for domestic and international trips last year rose by a modest 1 percent from 2012 levels… that growth matches the prior year-over-year trend”. These trends demonstrate the potential that is in the airline industry. It has been a difficult industry to participate, the only airline to earn profits has been Southwest. As profits become viable in the airline industry, opportunities to continue to grow are possible. AirFair service will add value through lower airfare and smoother check-in’s.

MANAGEMENT

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To start AirFair, we will venture off with five initial investors. Since our company is a service not a product, at startup we do not require additional personnel. Our company will be pitched as a team. Our team is the value of our company. We have high regards for communication. As you can observe in our organizational chart, all five have direct contact with the other four. Until we solidify our presence in the industry AirFair will employ only the top level management positions. In the future we expect to hire clerical workers, assistants, bookkeepers, and additional staff.

CEO, CFO, President - Abhishek Chowdhary

Chief Executive Officer - Focused on company’s mission and vision. Manage due dates and ensures effective communication.

Keep company focused on goals and sensitive to public relations.

Chief Financial Officer - Responsible for accounting and finances of the business. Cash flows, accounts receivables, accounts payable, and finances are balanced and maintained.

Manages budget projections and investments.

COO, Vice President - Madeline Cruz

Chief Operations Officer - Focused on company’s mission and vision. Manage due dates and ensures effective communication.

Keep company focused on goals and sensitive to public relations.

CMO - Jessica Means

Chief Marketing Officer - Responsible for all marketing and advertising of the company. Hands on Public Relations.

CCO - Ricardo Martin Coloma

Chief Creative Officer - Work together with CMO, responsible for logo design and marketing brand of company. Media and commercials of company.

CTO - Andrew Jones  

Chief Technology Officer - Responsible for all technologies of the company. Creating and maintaining relations with supplier and partners.

MARKET RESEARCH

The problem that our company will help solve is to make the airlines more profitable and efficient so that their clients have access to affordable flights and make flying an effortless experience.  Airlines are not currently a high profit business, just last year did airlines begin earning profits.  According to an article by Alicia Adamczyk, Director General and CEO, Tony Tyler of IATA reports that on averaged airlines retain $8.27 for every passenger carried.  Airlines are reported to have a hard-earned averaged profit of 4%. One main contributor to the increase in profit is due to oil costs from 2014 to 2015 decreasing by 36%.  Airlines as a whole are projected to earn $29.3 billion for the year 2015.  Even though this may seem like a lot of money it is not when you think of this being the annual profit for all airlines. (Alicia Adamczyk 2015).  

Competition:

Our company will be based out of the United States and provide consulting services for all commercial airliners.  The airline industry is a small market and commercial airliners are an even smaller piece of that market. There are many different marketing/consulting companies available to airlines.  Some including Aviation Marketing Consulting, Bain and Company and Simpliflying.  These agencies offer services such as branding, strategic planning, trade shows, advertising and PR for all aviation services.  While having various services may be attractive for some airlines, the specialization our company has to offer sets us apart from competitors.  

Airlines have also done some of the following things to improve customer experience.  Jetblue provided a free book vending machine to certain airports.  TAM used Facebook profiles to personalize in flight magazines. Jetstar used TV shows to create a new on board meal. Air France lets passengers play a digital waiting game at that gate for a chance to win upgraded seats.  KLM lets families and friends surprise loved ones with a “seat cover” greeting. (Kollau, Raymond 2014) All of these ideas increase the customer’s experience but do not limit costs for the airline and the customer.

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