BE200 - Analyzing Consumer Behavior in United Airlines Marketing

This assignment provides an analysis of United Airlines' marketing strategies, focusing on consumer behavior and the marketing environment. It defines key concepts such as the marketing environment, market segmentation, targeting, and positioning, and explains how changes in demographic, cultural, and economic environments affect United Airlines' decisions. The assignment also includes a SWOT analysis of the airline, identifying its strengths, weaknesses, opportunities, and threats. It further explores how United Airlines uses market segmentation to grow its business, highlighting the importance of understanding customer needs and preferences in a service-based industry. This document is available on Desklib, a platform offering a range of study tools and resources for students.

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Question 1
a- Define Marketing environment
The marketing environment refers to the internal factors (distributors, retailers, shareholders,
customers and employees, etc.) and the external factors (economic, technological, social, legal and
political) that influence and surround operations of marketing.
b-Explain how changes in the demographic, cultural, and economic environments affect united
airlines decision
A marketing environment consists of various elements that affect the way individuals and
organizations sell and buy their services and products. The elements usually vary by markets, products,
industry and location, but they are also inclusive of social influences like economic, cultural and
demographic factors that have affected the marketing decisions of the United Airlines. The demographic
factors include age affect the demand for air travel which has significantly increased over time which has
resulted in a change in travel preferences among the current generation. In addition, the demographic,
cultural and economic environments play a significant role in forecasting demand by United Airlines. For
example, in the tourism and travel future of the United States will be defined by the millennial generation
growth which includes the 16-34-year-olds (baby boomers). The spending on air travel by people who
were born is anticipated to decrease significantly.
Research by Dotson, Clark and Dave (2008 p.665) shows that in the United States, the millennial
generation is the future of the tourism and travel industry. Currently, the baby boomers’ needs are driving
the travel industry in the United States. In the next 5 – 10 years, it is expected that the baby boomers will
enter their traveling, spending and earning years. Therefore, there is an expected increase in their
business travel by a growth of fifty percent by 2020. However, in the next fifteen years after that, it is

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expected to remain strong. Since the baby boomers are currently the active customers, their spending on
business travel is expected to decrease to sixteen percent by 2020 (Greer, 2008 p.421). Therefore, the
high scores of customer satisfaction of major United States Airlines, their decisions in segmenting the
market and the demographic, cultural and economic environments have increased the focus on the
satisfaction of dynamic customer travel preferences so as to remain successful.
Question 2
a- Define Market Segmentation, Market Segment, Targeting and positioning
A market segment refers to a group of individuals, organizations or groups who may share similar
characteristics, traits and interests (Dolnicar, 2008 p.134). The segments of consumers may have the
same expectations, wants and needs. Therefore, organizations should strive to understand the particular
market segments they should serve by first determining the ways which are most appropriate to
differentiate and distinguish their segments.
On the other hand, market segmentation is the actual process of the identification of market segments
and the process of dividing a large base of customers into smaller consumer sub-groups that consist of
prospective and existing customers (Natter, Mild, Wagner & Taudes, 2008 p.603). Market segmentation
is a process that is consumer oriented and is applicable to almost all types of markets. In the
segmentation and division of markets, organizations typically look for characteristics that are shared
including similar demographic profiles, lifestyles and needs. Therefore, market segmentation assumes
that different market segments require different programs for marketing since many customers are
usually targeted through various combinations of market variables, distributions, promotions, prices and
offers.

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Market targeting commences after the completion of market segmentation, whereby the organization
identifies all untapped marketplace needs since various customers may not be adequately being served by
competitors.
The final stage is product positioning, which refers to the specification of the position in which the
company wishes to occupy in the minds of their target customers relative to the services and products of
competitors (DeSarbo, Grewal & Scott, 2008 p.288).
b- Explain how united airline use segmentation to grow
The United Airlines has used market segmentation to grow through the offering of diverse ranges
of services and products that are customer focused. Since the airlines operate in a service-based industry,
the services required by the customers have been placed at the center of their marketing strategy through
segmentation. Besides offering convenient scheduling throughout its international and domestic routes,
United Airlines has sought to attract customers who are high-yielding in order to earn their loyalty and
preference.
Question 3
a-Define SWOT analysis
According to Helms and Nixon (2010 p.215) SWOT Analysis is a widely known tool for analysis and
audit of the overall environment and strategic position of an organization. It’s widely used for the
purpose of identification of business strategies for the creation of a business model which is specific to a
particular firm for the alignment of the company’s capabilities and resources to the requirements of the
environment in which the business operates.

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b. Talk about its components
SWOT stands for Strengths, Weaknesses, Opportunities and Threats. According to Bull et al.
(2016 p.103) strengths are the qualities that enable businesses to accomplish their mission, which are the
factors through which an organization can make and sustain continued success. Weaknesses refer to the
qualities preventing organizations from accomplishing their mission to achieve maximum potential.
Opportunities refer to aspects presented by the environment within an organization’s operation. Threats
are conditions that arise in an organization’s external environment and which place the reliability and
profitability of an organization in jeopardy. The United Airlines faces threats of failure in meeting its
financial targets and geopolitical upheaval and trade wars due to poor market segmentation strategies.
With respect to the article above
c- As a united airlines owner or manager, apply SWOT analysis to your business
The United Airlines strengths include favorable investor metrics, whereby among the three largest
global networks in the United States, the airline is the only one that has posted an increased share price
through late July 2018. In addition, the airlines have an operational performance which is improving,
through its market segmentation strategies. The airline also earned a four-star ranking due to its timely
performance between June 2017 and May 2018 (Quinn & Worline, 2008 p.502).
The United Airlines has the opportunity to successfully executing its market segmentation
strategy to capture specific groups of customers which will assist in the company’s profitability.
Additionally, the airline has an opportunity of instilling a cultural change which is lasting by engaging in
employee training programs for better customer services.

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United Airlines has weaknesses due to challenges in sustaining a positive brand image through
the battling of negative passenger events of high profile. The airlines also have uncertainties over scope
which has been a great weakness.
The United Airlines faces threats of failure in meeting its financial targets due to poor
market segmentation strategies and geopolitical upheaval and trade wars. However, the company has
assured of its flexibility of addressing trade wars or a recession through retiring aircraft that are older and
returning aircraft off-lease.

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References
Bull, J.W., Jobstvogt, N., Böhnke-Henrichs, A., Mascarenhas, A., Sitas, N., Baulcomb, C., Lambini,
C.K., Rawlins, M., Baral, H., Zähringer, J. and Carter-Silk, E., 2016. Strengths, Weaknesses,
Opportunities and Threats: A SWOT analysis of the ecosystem services framework. Ecosystem Services,
17th ed., Netherlands: Elsevier, pp.99-111.
DeSarbo, W.S., Grewal, R. and Scott, C.J., 2008. A clusterwise bilinear multidimensional scaling
methodology for simultaneous segmentation and positioning analyses. Journal of Marketing Research.
AMA Publications: America, pp.280-292.
Dolnicar, S., 2008. Market segmentation in tourism. Tourism management, analysis, behaviour and
strategy, pp.129-150.
Dotson, M.J., Clark, J.D. and Dave, D.S., 2008. Travel motivations and destination activities of young
travelers of different ages: An empirical study in the united states. International Journal of Management,
4th ed. Proquest: United States, p.665.
Greer, M.R., 2008. Nothing focuses the mind on productivity quite like the fear of liquidation: changes in
airline productivity in the United States, 2000–2004. Transportation research part A: policy and
practice, 2nd ed. Netherlands: Elsevier, pp.414-426.
Helms, M.M. and Nixon, J., 2010. Exploring SWOT analysis–where are we now? A review of academic
research from the last decade. Journal of strategy and management, 3rd ed., Emerald group Publishing:
United Kingdom, pp.215-251.

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Natter, M., Mild, A., Wagner, U. and Taudes, A., 2008. Practice Prize Report—Planning New Tariffs at
tele. ring: The Application and Impact of an Integrated Segmentation, Targeting, and Positioning Tool.
Marketing Science. 4th ed. Informs publications, pp.600-609.
Quinn, R.W. and Worline, M.C., 2008. Enabling courageous collective action: Conversations from
United Airlines flight 93. Organization Science, 4th ed., Informs publications, pp.497-516.