Jetblue Airways: Can It Survive in a Turbulent Industry
1. JetBlue’s Mission
David Neeleman found JetBlue in 1999 with the mission “to bring humanity back to air travel". This goal is achieved by creating a company that offers comfortable, friendly travel at low fares and by this to differentiate themselves from the mass.
JetBlue has always identified itself as a customer service company first, focused on providing customers a unique experience on every flight and with every interaction with JetBlue. (Annual report, 2005)
2. Brief STEP (social, technological, economic political) analysis
S. There are several social and cultural factors influencing the airline industry: the globalization, mergers between airlines, weather, September 11, 2001, wars with other nations.
September 11 attacks on the World Trade Center have a harsh impact on the industry. It created fear among airline customers and a need for increased security. The security regulations resulted in long lines at the airports and flight delays, causing decrease in revenues.
Airline mergers can cause the industry to experience big changes. If larger companies are created, they can either benefit from the mutual knowledge, brand, and management or suffer from reduced competition, therefore increase in fares and decrease in service quality.
Globalization is inevitable and will enable airlines to reach bigger markets, thus achieving economies of scale, lower cost and prices.
T. Internet has a significant impact over the way the airlines conduct business. Customers become more price- sensitive and can compare and buy tickets online. This is beneficial for the low-cost companies, because they stand out. The E-tickets reduced the use of ticket agents. “The Internet provide the lowest-cost form of distribution for airlines through both indirect and direct channels” (bsg.com) For JetBlue, Internet is a way of reducing the cost, and consequently, a way to fulfill its mission. Furthermore the customer service representatives now can work from their homes
David Neeleman found JetBlue in 1999 with the mission “to bring humanity back to air travel". This goal is achieved by creating a company that offers comfortable, friendly travel at low fares and by this to differentiate themselves from the mass.
JetBlue has always identified itself as a customer service company first, focused on providing customers a unique experience on every flight and with every interaction with JetBlue. (Annual report, 2005)
2. Brief STEP (social, technological, economic political) analysis
S. There are several social and cultural factors influencing the airline industry: the globalization, mergers between airlines, weather, September 11, 2001, wars with other nations.
September 11 attacks on the World Trade Center have a harsh impact on the industry. It created fear among airline customers and a need for increased security. The security regulations resulted in long lines at the airports and flight delays, causing decrease in revenues.
Airline mergers can cause the industry to experience big changes. If larger companies are created, they can either benefit from the mutual knowledge, brand, and management or suffer from reduced competition, therefore increase in fares and decrease in service quality.
Globalization is inevitable and will enable airlines to reach bigger markets, thus achieving economies of scale, lower cost and prices.
T. Internet has a significant impact over the way the airlines conduct business. Customers become more price- sensitive and can compare and buy tickets online. This is beneficial for the low-cost companies, because they stand out. The E-tickets reduced the use of ticket agents. “The Internet provide the lowest-cost form of distribution for airlines through both indirect and direct channels” (bsg.com) For JetBlue, Internet is a way of reducing the cost, and consequently, a way to fulfill its mission. Furthermore the customer service representatives now can work from their homes