Environmental factors Paper 1

Environmental factors Paper (Southwest Airline)

Desmond Harris

MKT421

University of Phoenix

Instructor Jackie Barnett

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Southwest-Air Tran bad news for rivals Dan Reeds Southwest Air Tran bad news for rivals: USA Today 09, 28, 2010 article depicts Southwest airline and Air Tran combining into the most dominant airline in the airline industry. Confident that Delta in Atlanta will be one of the industrys biggest losers. Southwest acquisition of the nations leading discount carrier and its premium pricing will meet a merging success that will jeopardize business affairs for all competition in the airline industry. Notably acknowledges analysts in the regulation field reveal no problems or troubles in accomplishing Long-term expectations for the airline future. The writer Reed presents the down falls for the competition in the airline industry. Screening the environmental factors of Southwest airline resources and objectives will eventually have marketing effects toward competitors like, Delta airline in Atlanta. The prediction of a bigger Southwest delivers the highest global and domestic evaluation for opportunities for reaching every major and secondary air traveling markets in the United States. Provides do reasons for Reeds disappointing news for the external marketing environments for the competition. One main focus in Reeds article is the strategy planning of Southwest airlines innovative positioning in the acquisition of the nations leading discount carrier Air Tran Airways. This would lead to a successful strategy planning in basic business with the merger of Southwest acquiring Air Tran. The marketing strategy planning process requires narrowing down to the best opportunities and developing a strategy that gives the firm a competitive advantage and provides target customers with superior customer value (Perreault, Cannon, and McCarthy, 2009, p, 60). Reed shows that for Southwest business objectives will provide an opportunity for growth of about 25% overnight, gain new accesses to more airports, and provide ways to alleviate traditional fares and charges in these additional airports. Reed is correct by perceiving

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that Southwest acquisition would be a qualitative criteria; a new opportunity exist in New York and Washington which would be a direct market for Southwest Airline domestic market. It would also present a global environment of expansion in marketing decision. This would defiantly present Southwest with a competitive advantage that presents promising and beneficial conclusion in Reeds depiction.

Further evidence to Reeds belief that bad news for rivals will be presented by Southwest Air Tran airline and airways are in the support to the evidence of the article. Reed uses a veteran aviation economist George Hoffert; who also is a lecturer at the University of Richmond in Virginia. His statement of Now those premium prices will be in jeopardy for all the other airlines (Reed, 2010) is more of an opinion of choice than of fact. One can say that this could be considered an acquisition of competition on Reeds behalf. According to Armstrong, and Kotler, (2009, p, 486) Critics also charge that a companys marketing practices can harm other companies and reduce competition. Three problems are involved: acquisitions of competitors, marketing practices that create barriers to entry, and unfair competitive marketing practices. Seeing that the statement needs to be proven to support the Southwest strategy, customers support, and response to what the market would be offering of value. Regarding George Hoffer second statement saying The most powerful discount carrier ever is coming in to both of those airports with lots and lots of slots predicts and indentifies with promising fact for Reed because Air Tran is considered to be that. Acquisition is a complex subject. Acquisitions can sometimes be good for society. The acquiring company may gain economies of scale that lead to lower costs and lower prices. (Armstrong, and Kotler, 2009)

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Reed continues to demonstrate the importance of Southwests deal to buy Air Tran. He delivers the understanding that the governments involvement in Southwest acquisition will be trouble free making a clear political climate of approval in the acquisition. The importance of rules and regulation is a must so when the issue of antitrust is involved Reed addresses this point with an analysts ok toward assurance of approval. This may not have been Reeds best course of presenting an important part of understanding in the article. The legal restriction usually provides clarity to the strategic planning and has some type of involvement within the acquisition.

Reed backs his acknowledgements of social responsibility for Southwest with two Justice Department examples of past approved mergers that include the competitions success. The two examples are the merger of United and Continental and the merger of Delta and Northwest. In this section of Reeds article delivers a strong position that is back up by research recipient and airline analyst Henry Harteveldt from the Forrester Research establishment. Henry Harteveldt provides a favorable statement which states concerns about reduced airline competition are very different and not as problematic (Reed, 2010). Reed uses another opinion to favor Southwest takeover in fact this actually enforces his writing and powers his article. Harteveldt further said Long term, we're going to end up with a stronger Southwest that's going to be competing with airlines like Delta and the newly merged United" (Reed, 2010). It almost seems that Reed is defiantly trying to sale Southwest acquisition and there are several analysts that have substantive approval for the acquisition success. The philosophy of enlightened marketing holds that a companys marketing should support the best long-run performance of the marketing system. (Armstrong, and Kotler, 2009, p, 492)

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Reed ends his article with two more acknowledgement figures; one of which is just named Hoffer I would imagine that this person is an important person involved in the merger. Reed depicts this gentleman Hoffer as a highly knowledgeable person that speaks on the future of operating airlines, the future of Southwest continue service from Atlanta, and Air Tran results. Last but not least Reed quotes the Chief Executive Officer of Southwest Gary Kelly which informs Reed that bigger operations exist in the Northeast and thy also face competitive markets and key issues. The marketing strategy and planning in a business has objectives and those business objectives have to relate to the companys marketing objectives. For example according to Perreault, Cannon, and McCarthy, (2009) firms need a hierarchy of objectives moving from company objectives to marketing department objectives. For each marketing strategy, firms also need objectives for each of the four Ps as well as more detailed objectives.

Conclusion
The writer of this article presented the information through the article with persuasion and strong backing of professionals of certain fields and experiences. Reed took the understanding and places the marketing strategy at a value for Southwest airline and organized the understanding as a critical concern for the competition which involves mainly Delta Airline. It reaches the intended audience and could have a favorable effect and massage toward an environmental factors of a business. Reed has a good language throughout the article and uses competition as the imagery playing field of the article. The future of Southwest acquisition looks promising and right for success and has a favorable strategic plan.

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References Armstrong, G. & Kotler, P. (2009). Marketing: An introduction (9th ed.). Retrieved March 05 2011 from Upper Saddle River, NJ: Pearson Education. Bailey, C. D., Collins, A. B., Collins, D. L., & Lambert, K. R. (2009). An Analysis of Southwest Airlines: Applying the Horngren, Datar, and Foster (2006) Strategic Profitability Analysis Approach. Issues in Accounting Education, 24(4), 539-551. Retrieved from EBSCOhost. Perreault, W. D., Cannon, J. P., & McCarthy, E. J. Jr. (2009). Basic marketing: A marketing strategy planning approach (17th ed.). New York, NY: McGraw Hill. SOUTHWEST AIRLINES CO. (n.d). Retrieved from EBSCOhost.