A corporate strategy article by Thunderbird students Amina Ahmed, Marquita Blanding, Benjamin Donner, Julia Glad and Carla Vila
Positioned as a budget airline company with a tourism focus, JetBlue is synonymous with the keywords “quality” and “customer satisfaction.” JetBlue offered many firsts in the airline industry, including: satellite TV, satellite access to e-mails, vacation packages on eBay, and a “customer bill of rights” — that enables customers to be compensated for their inconveniences. Today, JetBlue has expanded its operations to include partnerships with international airlines, with a fleet of more than 400 airplanes. Despite the fierce competition of the airline industry, JetBlue continues to rise in popularity and revenues. How does JetBlue manage to continue its growth, especially while competing with rival discount airline Southwest?
Fierce Competition – Jet Blue and the airline Industry
The airline industry has changed dramatically since the early 2000s, due, in part, to the volatile global economy. Many airlines, more so in the U.S., have had to alter their competitive plans in order to keep up with the changing dynamics of the industry. In order to stay afloat, many full-service airlines looked to cost-cutting options, while airlines like Jet Blue and Southwest focused on delivering services differently than their competitors. At the time, these services were either standard or unique to the industry. Ultimately, full-service airlines found it much harder to compete with low-cost, convenient service airlines. Some of those airlines either went out of business, or completely re-engineered their business plan, or merged with other airlines to be competitive. Some of the most noteworthy mergers and acquisitions are United and Continental, US Airways and American West, American Airlines and TWA, and Southwest and AirTran.