Current Strategy of JetBlue Airline
Brief History of JetBlue Airlines
JetBlue Airlines is an esteemed airline that has the mission of “bringing back humanity back to air travel” (Sheth 12). This airline achieves this through delivering of value, service, style, as well as comfort towards their clients, in addition to their employees. JetBlue Airlines was incorporated in the year 1998 in Delaware and started service in the year 2000, the primary base of operations being at JFK in New York. According to Hüschelrath & Kathrin (65), in the year 2002, it operated 108 flights on a daily basis, 52 of them being between JFK as well as FL, and 26 of them being between JFK and New York.
The mission of Jet Blue Airlines is to “bring back humanity back to air travel” by being a leading low fare as well as cost passenger airline that offers a high quality customer service towards underserved markets in addition to customer who are searching for the best value during their flight. Jet Blue Airlines have the modern most advanced airplanes that are reliable, efficient in terms of fuel, uses paperless cockpit technology, have live in-flight satellite TV as well as security cameras. The philosophy of Jet Blue Airlines is to give their clients the best price value in the market for their ticket, as well as providing things competitors do not provide (Peterson 10). At JetBlue Airlines, they feel that hiring well-trained employees who are as well highly motivated and educated will give a better experience towards their customers. Jet Blue Airlines also feel that their high-value and quality service philosophy will propel the company to become the leader in the industry.
The vision statement of JetBlue is to offer the best and cheap flight experience of whichever air carrier whereas offering superior service.
Current Objectives of the Firm
Offering support to the objectives of the organization and being true to its values- JetBlue Airlines aim to place its compensation programs in line with its business strategies which are focused on the long-term as well as creation of value for their stockholders. JetBlue Airlines motivates its crew members in overcoming different challenges as well as to deliver on their commitments, while still maintaining their values regarding Safety, Integrity, Caring, as well as Passion.
Attract as well as retain the top talents- JetBlue Airlines’ objective is to set target compensation that will enable the organization to become competitive within the airline industry in terms of its location, network, unique market position, structure as well as size in relation to other airlines. In order to attain this, JetBlue aims at acquiring the top talent in the airline industry as well as retain them so that they can spearhead the organization towards achieving its goals.
Pay for performance- JetBlue Airline holds its executive personnel accountable for the performance that they portray in light of the organizations’ goals, industry performance as well as individual performance. JetBlue Airline believes that the section of executive compensation that is designed to be delivered in terms of variable pay ought to rely on the position of the executive as well as the capacity of the respective position in terms of influencing the overall corporate performance.
Current Strategy of JetBlue Airlines
1. Goals and Performance Targets- The strategy of JetBlue Airlines has been to position itself as a leading low fare and low cost passenger airline through provision of high quality customer service as well as differentiated products towards their clients.
2. Market Focus- JetBlue Airlines as well focuses on serving markets that are undeserved along with large metropolitan regions where the average fares are high, with a differentiated geographical flight programme that incorporates both short as well as long haul routes.
3. Product/Service Focus- product/service is a significant marketing mix that JetBlue Airline focuses on so as to be competitive within the industry. The strategy that JetBlue Airline has adopted in relation to its product is the concept of “doing more with less.” The product offered by the carrier is a low-cost one, which changes the landscape of the domestic aviation. JetBlue Airlines offers high-quality services as well as products to its clients. While on-board, clients enjoy a unique flying experience that the company refers to as the “JetBlue Experience” which includes welcoming, customer service-oriented crewmembers, leather seats, free DirectTV® channels, as well as numerous free satellite radio. The airline as well offers wide-ranging free snacks and beverages (Peterson 30). According to the company, the “JetBlue Experience” of their clients is a significant aspect in retaining them.
4. Value propositions- the value chain of JetBlue Airline is derived from its firm infrastructure, technology development, operations, as well as human resource management. JetBlue Airline has adopted a simple value proposition, that is, lower fares that are accompanied by high-standard services (Peterson 13). This has been imperative in creating a distinctively powerful brand for the business during the past decade, hence contributing to the success story of the airline. JetBlue Airways has as well created a new airline category that is based on value, service as well as style. Well-known for its high-quality service along with free TV and low fares, JetBlue Airline offers its customers a lot of Legroom as well as spacious Legroom seats. The understanding of the airline industry by JetBlue has added a great value in the company as well as its stakeholders.
5. Capabilities- the competitive capability that JetBlue Airline has is derived from its value chains. With the different strategies that JetBlue Airlines has undertaken, it has very high potential of attracting new clients as well as retain the present ones. As a result, this is capable of placing JetBlue as a leader in this airline industry, which will then benefits its investors.
JetBlue’s Generic Competitive Strategy
JetBlue Airline has adopted several strategies so as to compete with their rivals in the airline industry, and improve on its standings (Sheth 101). The generic competitive strategies adopted by the company include the following:
Low-cost provision of services/products- JetBlue offers its services or product to their customers on relatively low cost in comparison to the price that their competitors charge. The Price charged to clients is a significant aspect in the marketing mix of the JetBlue. Customers are interested as well as attracted to quality service offered at a reasonable prices. In this respect, JetBlue Airline excels in beating their competitors in the provision of cheapest fares across the nation. This is significant in attracting customers to come and enjoy the company’s “JetBlue Experience.”
Differentiation of its products- JetBlue Airlines offer products that are highly differentiated to their customers. Apart from travelling with them, clients are provided with snacks, beverages, free TV as well as radio channels. These differentiated products are significant in making the customers enjoy the services and become regulars.
Focus on Costs- in order to offer low-cost services/products, JetBlue focusses on reducing its costs by investing in modern technology that enhances efficiency as well as cutting down the level of wastage. Embracing technology is an imperative step in reducing costs. With JetBlue’s low-cost strategy, the company has discovered that it can be able to increase its market share as well as dazzle clients with top-quality services at relatively low prices. This combination of cost management has produced a substantial competitive advantage to the airline (Sheth 45).
JetBlue’s Measures in Strengthening its Competitive Position
JetBlue’s Low-Cost Structure- according to Neeleman, Tom & Dan Rather, “JetBlue Airplane is $9.10 in terms of its low cost advantage” (112). With this figure, JetBlue’s low-cost structure makes it possible for the airline to charge low fares to its customers and yet remain profitable business. This has been significant in enhancing the expansion of the airline during the past decade, making it to be ranked as the 5th best airline in the United States.
Strengthening its presence on high-value geographies- In addition, JetBlue Airline focusses on high-value geographies such as Boston, New York, as well as the Caribbean. This will be beneficial in the long-run in terms of increasing the competitiveness of the airline with the other leaders in this industry. According to Wynbrandt, JetBlue’s strong presence in Boston has helped the airline to increase its revenues in the year 2013.
JetBlue’s Organizational Awareness
The strategies that JetBlue Airline has undertaken is clear in terms of outlaying the company’s growth blueprint. The clarity of the strategies is evident on the measures that JetBlue has adopted in making sure that the future of the airline is secure. This is evident of the infrastructure as well as the technology that the company has invested in the past.
These strategies are well communicated to the executive personnel within the company. In addition, these strategies have been communicated to the present as well as prospective customers to the airline, through the enhancement of JetBlue’s brand image during the past.
According to Maina, both the short-term as well as the long-term strategies of JetBlue Airline have been communicated from the top to the bottom of the organization. This is imperative in making sure that all individuals in the organizations are working towards a common goal/purpose.
JetBlue’s Strategy Integration and Fit
JetBlue Airline has integrated its strategies in a manner that makes the company to fir within the industry so as to make sure that it is able to compete with the other players. These strategies fit perfectly well with the external factors such as customers. JetBlue has given their clients one of the high-quality services/products that are offered in the airline industry, helping the company to fit itself in this component of the external environment.
Additionally, the current strategy by JetBlue as well fits with the internal aspects of the company. For instance, the strategy lives up to the mission of the company, that is, to “bring back humanity back to air travel.” This is because the company has reduced fares that make it affordable for people to travel by air.
The current strategies as well fit with the capabilities of JetBlue. Over the last decade, the company has created a lot of infrastructure so as to fit the long-term goals of the company. The company has as well purchased more airplanes with a high passenger capacity so as to be ready for its growth within this industry. The firm does not need to make whatever changes in its strategies since it has strategically placed itself to face the future.
Hüschelrath, Kai, and Kathrin Müller. The Value of Bluer Skies: How Much Do Consumers Gain
from Entry by Jetblue Airways in Long-Haul U.s. Airline Markets?Mannheim: ZEW,
Zentrum für Europ. Wirtschaftsforschung, 2012. Print.
Neeleman, David, Tom Anderson, and Dan Rather. Jetblue. New York: CBS Worldwide, 2002.
Peterson, Barbara S. Bluestreak: Inside Jetblue, the Upstart That Rocked an Industry. New York:
Portfolio, 2004. Print.
Sheth, Jagdish N. Deregulation and Competition: Lessons from the Airline Industry. New Delhi:
Response Books, 2007. Internet resource
Wynbrandt, James. Flying High: How Jetblue Founder and Ceo David Neeleman Beats the
Competition --- Even in the World's Most Turbulent Industry. Hoboken, N.J: Wiley,
2014. Internet resource.
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