Slides 21 Flashcards
What is the first part of the two-part assignment in the Delta Case Study?
Identifying the Five Forces of the US Airline Industry
This involves answering 12 questions about the competitive landscape.
What should groups consist of in the Delta Case Study assignment?
Groups of 3-4 people
What is the deadline for submitting Part 1 of the assignment?
By 11:00
What is the focus of Part 2 of the assignment?
Identifying Delta’s Responses to Each of the Five Forces
What type of competition exists among airlines?
Internal Rivalry
How do airlines compete with one another from a customer point of view?
Through pricing, service quality, and routes offered
Does the US airline industry have a lot of internal rivalry?
Yes
The level of internal rivalry can be assessed based on market competition and pricing strategies.
Is the airline product homogenous?
No
Airlines offer different services, pricing, and customer experiences.
How easy is it for customers to compare pricing between airlines?
Very easy
Are there any switching costs for customers in the airline industry?
Generally low
What types of costs do airlines incur?
Fixed and variable costs
What level of bargaining power do suppliers have in the airline industry?
Moderate to high
Depends on the type of supplier, such as fuel providers and aircraft manufacturers.
What are some substitutes for air travel in the US?
Trains, buses, and personal vehicles
What impacts the threat of new entrants in the airline industry?
Fixed and variable costs, airport landing slots
How did Delta attempt to compete with its low-cost rivals in 2003?
By enhancing customer service and loyalty programs
How do Delta and other legacy airlines compete with low-cost rivals today?
By offering differentiated services and frequent flyer programs
What strategies has Delta used to reduce internal competition?
Mergers, alliances, and cost-cutting measures
What has Delta done to increase switching costs for customers?
Enhanced loyalty programs and customer service
How has dynamic pricing impacted the bargaining power of customers?
It has decreased bargaining power due to price variability
How has Delta attempted to limit the bargaining power of its employees?
By negotiating contracts and improving working conditions
How has the prevalence of online meeting tools impacted the airline industry?
Reduced demand for business travel
