TH50117E - Southwest Airlines: Service Marketing Mix & Drivers

This essay provides an in-depth analysis of Southwest Airlines' service marketing strategies, focusing on their core services, supplementary offerings, and target market segments. It identifies Southwest's core service as offering low-cost, no-frills flight services, supplemented by in-flight entertainment and ground services. The essay examines the company's marketing mix, including product, price, place, promotion, physical evidence, people, and process, highlighting their market penetration pricing strategy and diverse workforce. Furthermore, it discusses the positive and negative impacts of external drivers such as economic recession and untapped market opportunities on Southwest Airlines' business, concluding that effective coordination of the marketing mix elements will enable the airline to enhance its business in both developing and emerging markets. Desklib offers a wide range of past papers and solved assignments for students.

Running head: SERVICE MARKETING
Service marketing
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Author note

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Introduction
In the current business scenario, there are different factors that should be maintained by
the business organizations especially the service sector organizations. This is due to the reason
that current service sector across the world is highly competitive in nature. In addition, this is
also should be noted that it is important for the service organizations to align their service
elements to that of their external business factors (Plath 2013). On the other hand, the service
offerings should also be flexible enough to cope up with the change in the market requirements
and trends. In this essay, the service portfolio of the Southwest airlines will be discussed
including their core services and their elements (Southwest.com 2018). In addition, the major
two key external drivers will also be discussed that are having both positive and negative impacts
on the business.
Importance of marketing
Marketing refers to the process of determining the requirements and expectations of the
target customers and offering product or services accordingly. In addition, it also refers to the
process of segmenting and target the specific sets of customers whom will be focused and
identifying their key needs and trends. Marketing mix is also an important factor due to the
reason that the elements of the marketing mix helps the business organizations in having a
holistic strategy in catering to the target customers (Tiago, M.T.P.M.bB and Verissimo 2014). It
is also important because marketing mix includes the major elements such as pricing strategy,
product strategy and promotional strategy.

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Company profile
Southwest airlines are one of the leading airliners in the world from the United States.
They are also being considered as the largest budget carriers in the world and were founded in
1967. It is reported that Southwest airlines is having more than 58000 employees across their
operations and daily operating in more than 99 national and international routes. One of their
major characteristics is offering of single type of aircrafts unlike the other airliners, which are
having diverse range of aircrafts (Southwest.com 2018). As of now, Southwest airlines are only
operating Boeing 737 aircrafts, which is helping them in having lower cost of maintenance and
low time consumption in scheduling the flights.
Identification of the core service
The core service of Southwest airlines being identified is offering low cost and low frills
flight services across different destinations. However, there are number of other supplementary
services are also being offered to the customers including the in-flight entertainment, cuisines
and ground services (Dimitriadis and Koritos 2014). The major characteristic of the core service
offering of Southwest airlines is the presence of diversity. This is due to the reason that
customers are given the basic flight services along with the added facilities for a fee. In addition,
the service offering of Southwest airlines can be considered as heterogeneous due to the reason
that core service of them is depended on the service attendants such as flight attendants, air
hostess, ground front line employees and pilots.
In terms of tangibility, the core service of Southwest airlines is intangible, which can only
be experienced and do not any physical evidences. However, the presence of physical tickets and
merchandise provides some sort of tangibility in the service offerings of them. These tangible

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features also provide a source of gaining competitive advantages for the Southwest airlines over
their competitors by means of differentiation (Panda and Das 2014). In addition, core service
offering of the Southwest airlines can also be termed as market oriented. This is due to the reason
that the service elements are being changed in accordance to the change in the market scenario
(Chathoth et al. 2013). For instance, the in-flight entertainment system is being offered by
Southwest airlines after the pilot test being done in 2011. It helps them in effectively aligning
their service portfolio according to the current trend and requirements of the market and stays
relevant in the market.
Identification of the target segments
There are different target segments being profiled by the Southwest airlines for their
marketing activities. In terms of demographic segmentation, the target age groups for them are
between 20 and 50. In addition, the age groups below 20 are also segmented as the secondary
target markets (Cross, Belich and Rudelius 2015). This is due to the reason that children also
travels with their families. This is due to the reason that customers from the higher income group
will opt for the legacy airliners and lower income groups will not have the affordability for the
flight travels. In terms of the geographical segmentation, the major cities of operation for the
Southwest airlines in the United States are being targeted (Chakrabarti and Mitchell 2013). Thus,
the customers willing to have their journeys in between these cities are the target customers for
Southwest airlines.
In terms of the psychographic segmentation, customers with having the sole
responsibility of no frill travels without having the need for other supplementary services are
being targeted. In addition, customers with having least preferences for the complex airport

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activities and services are also being targeted by the simplified services of Southwest airlines
(Aghdaie and Alimardani 2015). Loyalty level of the customers is also being considered by
targeting the customers with higher loyalty. This ensures the continuous flow of the fund for the
Southwest airlines in addition of generation of positive word of mouth.
Identification of the marketing mix
Product  The core service of Southwest airlines is to provide no frill and low
cost flight services.
 Supplementary services are being offered to enhance the service
variability to the customers (Dabholkar 2015).
 Heterogeneous services are help in differentiated approach for
Southwest airlines among the customers (Bansal and Taylor 2015).
Price  Southwest airlines follow market penetration pricing strategy to
justify their budget carrier market position.
 Initiation of the market penetration strategy helps in catering to
more number of customers and having better brand exposure
(Schmidt, Spann and Zeithammer 2014).
 Market penetration strategy is also helping Southwest airlines in
catering to the smaller markets where the competition is low over
the bigger cities.
Place  Southwest airlines are having the presence majorly in the American
states and in 11 foreign countries.
 Tickets are being sold via both online and offline mediums.
 Third party agents are also involved in dealing with the ticketing

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(Gangwar, Kumar and Rao 2013).
 This is providing them in having multiple windows of generating
their revenues along with having more touch points with the
potential customers.
Promotion  Southwest airlines are known for their extensive marketing
activities involving different marketing mediums.
 Social marketing is being majorly used in communicating with the
customers and reviewing their feedbacks.
 Loyalty programs are also initiated as part of promotional activities.
This is ensuring the high level of customer retention (Kreis and
Magael 2014).
Physical evidence  Being a service organization, Southwest airlines is not having any
tangible evidence.
 However, supplementary services such as selling of merchandise
provide physical evidence to the customers (Aghaei et al. 2014).
 Hardcopy of the tickets also acts as the physical evidence for the
customers.
People  Southwest airlines are having diverse workforce, which helps in
catering to different customer segments effectively.
 They are known for their employer branding and thus having one of
the most satisfied employees in the industry.
 This is helping in providing better service to the customers along
with having more involvement level of the customers.

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Process  With reference to their no frills service tagline; Southwest airlines
maintain low profile and simplistic way of providing service.
 This includes online check in services and less time in boarding
activities.
 This is helping Southwest airlines in having, low cost and efficient
process of service delivery.
Identification of the two current drivers
One of the major external drivers that will have negative impacts on the business of
Southwest airlines is economic recession. In addition, it should be noted that other forms of
transportation provides cheaper alternative to the flights and this emergence of economic
recession will deviate the customers towards these alternative modes (Cowling et al. 2015). On
the other hand, emergence of the economic recession will also cause reduction in the sales
volume of Southwest airlines. Thus, their average profitability will get down.
The major external driver that will have positive impact on the business of Southwest
airlines is availability of the untapped market. Majority of the legacy airliners are not having
their presence in the shorter routes and smaller cities. Thus, Southwest airlines are having the
opportunity to tap these markets and maintain their market leadership. In addition, emerging
markets majorly in the eastern world are developing faster than that of their existing markets
(Bowen 2016).
Conclusion

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This essay concludes that Southwest airlines are having different service elements
aligned with the current business situations. In this essay, the different service elements of the
Southwest airlines are being identified and discussed. In addition, the importance of marketing
and marketing mix is also being discussed in this essay. It is identified that proper coordination
among the different elements of the marketing mix will enable Southwest airlines to have holistic
marketing approach in the market. It is concluded that existing marketing mix strategy of the
Southwest airlines will help them to enhance their business in the new markets also including the
developing and emerging markets.

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