American Airlines Marketing Strategy & Marketing Mix (4Ps)
Published by MBA Skool Team, Last Updated: December 19, 2016
Marketing Strategy of American Airlines analyses the brand with the marketing mix framework which covers the 4Ps (Product, Price, Place, Promotion). There are several marketing strategies like product innovation, pricing approach, promotion planning etc. These business strategies, based on American Airlines marketing mix, help the brand succeed in the market.
American Airlines marketing strategy helps the brand/company to position itself competitively in the market and achieve its business goals & objectives.
Let us start the American Airlines Marketing Strategy & Mix to understand its product, pricing, advertising & distribution strategies:
The product strategy and mix in American Airlines marketing strategy can be explained as follows:
American Airlines being an Airline Company have seat selling on their flights as a major product category in their marketing mix along with Hotel room booking, Cars, Vacations, Activities and Cruises. Seats are subject to availability and category like Business Class, First Class, Premium economy class and choice class. American Airlines provide flights both direct and connecting, thus ensuring customers are not inconvenienced. The provide services like Flagship Suite for international first class passengers. These flagship suites are available on Boeing 777 with privileges and access to the flagship lounge. American Airlines also provides Lounges at airports such as Admirals Club and Flagship Lounge. The Admirals Lounge were mainly for celebrities, politicians, VIPs as well as loyal customers. The Flagship Lounge was mainly for transcontinental international and domestic flight customers, Oneworld frequent flyers and AAdvantage Executive Platinum flyers. American airlines also earned revenues by selling seats on British Airways. Main Cabin Extra is American airlines economy plus product which is available mainly on mainline fleet. Main Cabin is an economy product available on its mainline and regional aircraft fleet.
American Airlines Price/Pricing Strategy:
Below is the pricing strategy in American Airlines marketing strategy:
American Airlines provides prices based on choice.
American Airlines provide a trip plan and you can choose based on your own needs. Customers can select from options like Choice, Choice Essential, Choice Plus, Fully Flexible and Business and First which includes round trip fare as well as added combinations of products and services. Choice is like an ordinary economy ticket with charges for extra features and baggage. Choice Essential allows customers to change flights without any charges, Group 1 boarding and also carry one checked in bag. However, Elite members get 3 complimentary checked bags. Choice Plus is similar to essentials with 50% extra miles, premium beverage and same day flight change and standby. Fully Flexible provides 25% mile bonus, priority baggage privileges and baggage delivery. Business/First provides 25%-50% mileage bonus, 2-3 checked bags, same day flight change and standby, premium beverage, priority baggage privileges and baggage delivery and dedicated check-in counters. This pricing includes all taxes and provides clear information throughout the booking experience. This gives an overview in the marketing mix pricing strategy of American Airlines.
Following is the distribution strategy in the American Airlines marketing mix:
American Airlines has 5 major hubs in New York, Dallas, Miami, Los Angeles and Chicago. Washington, D.C, Charlotte and Phoenix are the rest 5 hubs that operate on a slightly lower scale. Alongwith its regional partners American Airlines have built a vast domestic and international network. They fly to more than 50 countries comprising of around 350 destinations by 6700 flights every day. Dallas is the largest passenger hub with approximately 140,000 passengers daily. American Airlines have maintenance bases at Dallas, LaGuardia, Pittsburgh and Tulsa International Airports.
Tulsa handles the Boeing fleet.
American Airlines Promotion & Advertising Strategy:
The promotional and advertising strategy in the American Airlines marketing strategy is as follows:
American Airlines provides AAdvantage loyalty program through which flyers can redeem points or earn points for every mile travelled. They can also use miles for upgrades to First of Business class even on partner airlines, car rentals, hotels and other retail products. Passengers can even gift their miles to friends or family. American Airlines provide Executive Platinum, Platinum or Gold Status to frequent flyers via a card. These cards entitle flyer to privileges at airports, upgrades and bonus miles. Besides these promotional activities they have advertisements on Billboards, Onboard Magazines, Inflight and Airport entertainment solutions as well as social media like Twitter, Facebook and YouTube. Customers can now book tickets online through various channel providers. American Airlines coupon codes are available online and are easily redeemable. They also provide vacation discounts, special offers and vacation packages at Hotels and cruises. Owing to all these they have around $40 billion in operating revenue and is the largest airline in the world.
Since this is a service marketing brand, here are the other three Ps to make it the 7Ps marketing mix of American Airlines.
American Airlines is the largest airline in the world with services in more than 50 countries worldwide. They have 10 major hubs in cities across the world. Besides these they also have maintenance bases. Kiosks at airports, variety of aircraft, offices across the world are all examples of American Airlines' physical evidence.
American Airlines provides services to customers with a lot of benefits which keeps them loyal to the brand. They provide a loyalty program with redeemable points and upgrades. Such activities increase loyalty of American Airlines. Besides Flights they also have hotel booking, cruises, vacations and cars services and products with prices based on choice and availability.
The pilots, crew, ground staff and management have a very important role to play in the success of a brand like American Airlines. Since the airline is flying globally, more than 100,000+ people are employed with the organization. Doug Parker is the CEO and Chairperson of American Airlines. The airlines is the largest airline in the world carrying close to 150 million passengers annually. Hence, this concludes the marketing mix of American Airlines
About American Airlines:
American Airlines (American) started in the year 1926 as a U.S mail service from Missouri to Illinois. After 8 years C.R. Smith changed it from a mail service to a passenger airline. The first aircraft that was built by C.R. Smith and Donald Douglas changed the airline industry drastically. Today American Airlines is the largest airline in the world owing to its fleet size of 946, revenue and scheduled kilometres flown. It is also second largest in the number of destinations it serves. American Airlines is a member of the Oneworld alliance, a leading airlines alliance group in the world alongwith British Airways, Qatar Airways and Iberia. American has a vast domestic and international network flying to more than 50 countries.
They have flights throughout North America, South America, Europe, Asia and the Caribbean. American Airlines has 5 major hubs in New York, Dallas, Miami, Los Angeles and Chicago.
This article has been researched & authored by the Content & Research Team. It has been reviewed & published by the MBA Skool Team. The content on MBA Skool has been created for educational & academic purpose only.
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